06/11/2012 01:46 pm ET

Wall Street Does Not Care About JPMorgan's Loss

It's official: Absolutely nobody on Wall Street cares about JPMorgan Chase losing $30 billion.

That is the clear message of an exhaustively reported piece by Bloomberg's Max Abelson this morning.

Last week we cowered as the Irony Gods hurled lightning bolts at the news that Alan Greenspan fully supports JPMorgan's God-given right to lose billions of dollars in unregulated derivatives while being backstopped by the U.S. taxpayer. Greenspan has lots of company.

Abelson finds more than a dozen people who agree with Greenspan that JPMorgan losing $2 billion or $4 billion or $6 billion in credit derivatives, while shareholders lose about $30 billion in equity value, is not only not a big deal, but sort of just the way the world works. What the heck are you gonna do?

A sampling of quotes:

“I kind of shrug."

“I don’t think it’s a big issue.”

“There is no law that says you can’t lose money."

No, indeed, there is no law that says you can't lose money. The issue is whether there should be a law that banks with federally insured customer deposits should be prohibited from rolling the dice on risky, unregulated credit derivatives, to possibly lose a great deal of money.

In fact, there is such a law, commonly known as the Volcker Rule, part of the Dodd-Frank financial reform act. But JPMorgan CEO Jamie Dimon and a flying-monkey army of lobbyists representing Greenspan's Wall Street acolytes have tried to hopelessly complicate that rule and render it ineffective before it even takes effect, which is supposed to happen next summer.

JPMorgan's losses have dealt a serious blow to Wall Street's efforts to murder the Volcker Rule. That may be one reason they're taking to the media to defend JPMorgan so aggressively -- even though the Volcker Rule and other regulations the Greenspaniards hate could have prevented JPMorgan's loss.

JPMorgan CEO Jamie Dimon will have a chat about all this with lawmakers in a Senate hearing about the losses scheduled for Wednesday.

Dimon might claim that the loss was just a hedging strategy gone bad, writes Forbes' Halah Touryalai. Can't be helped, nothing the Volcker Rule would do about it.

But the massive credit-derivatives position built up by JPMorgan would have been prevented by the original Volcker Rule, before lobbyists carved out a massive exemption to allow for trades that "hedge" the risks that banks bravely take lending money to support the economy. All of Wall Street is lining up on the side of leaving that exemption in place. If they get their way, there will be plenty more multibillion-dollar losses for them not to care about, while policy makers and taxpayers clean up the mess.