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University of Maryland Economist Peter Morici on the role of regulators in J.P. Morgan’s losses.
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At least two congressional hearings are now scheduled to look into the trading debacle at JPMorgan.
The multi billion dollar -- raising serious questions about incompetence and Carr Robson.
And the federal government so says University of Maryland economics professor Peter -- -- Good morning -- in the February -- -- explain that why isn't that just the banks.
Problem -- well foremost.
Certainly if the bank's problem first and foremost but you know JPMorgan at a 110.
-- regulators.
Regulators that went to work every day in the offices of JPMorgan.
But none of -- happens have been in the chief investment office where these bets were being -- This senior executives apparently convinced.
That their government regulators at the highest level.
That there was nothing going on there they were just hedging managing cash nothing to worry about -- -- turns -- in addition to those -- they were also buying.
Equity position this and nearly bankrupt firms.
Among them among them -- firm that owns ebony magazine.
And is headed by a formal White House employee who left under a cloud -- -- is that not.
Black helicopter stuff.
Because again if you you can point the finger at the regulators and clearly they did a poor job that Jamie Dimon himself.
Shrugged off concerns about about this very trading going on in April so everybody fell down on the job did they not.
Absolutely I'm not I'm not -- Jamie Dimon certainly the chief investment office that they're saying that well -- -- she had Lyme Disease and so she wasn't really doing their job.
But she spent ten million dollars a year and she's dissected do her job she should have the presence of mind to put someone in -- that -- until she feels better.
Now there was certainly -- problems at JPMorgan in terms of management.
But also there were problems and turn it JPMorgan in terms of what they were telling regulators and how easily those regulators believed it.
Moreover did you know that the president has a privately managed account that JPMorgan hearing is trying to our regulate that company.
And according to disclosure forms he has between.
And half a million and a million dollars invested in a private yeah.
Nothing to do what that he has no direct authority -- that count doesn't.
But generally speaking.
Private clients don't they let the -- they wanna -- -- for them right what does he certainly does have an interest in the -- would be -- it would do it wouldn't be surprising.
The biggest bank in the country.
That he would have an account there -- Peter I'm just say actually -- -- I disagree with you there he's not an enormously wealthy man in their firms down on Wall Street.
-- deal with spoken -- -- five million dollar range they do nothing but the carriage trade he asked choices.
What essentially is what is what is best videos and -- -- that was going on in this office had with cool erupted somehow by the federal government it was going on in London.
For Pete's -- it wasn't even going on here.
In new York and to make these suggestions is highly questionable.
Peter highly I want snowball.
I I don't I don't think so we have to -- what's -- direct military's -- system.
Whereas -- unit that manages fifteen to 20% of the firm's assets 400 billion dollars is able that's helped federal regulators.
That this this unit does it need to be watched.
The trading may have gone on in London but it is part of the New York bank it is part of their regulatory liability of the US government and sun LII I I don't think -- -- -- -- -- -- -- -- They want him to testify in front of congress they're more congressional hearings or get on the case now do you think -- -- comes out of that.
I don't.
Thanks so I mean one -- one considers how much money is raised on Wall Street by both parties I JPMorgan Goldman Sachs and other places.
It's really hard to say it is effective regulation of the banking sector right now they're all the president of the New York fed comes from Goldman Sachs.
And the only difference between the fifth -- between the the bush administration and Obama administration treasury department's.
As the difference between the fifth floor in the six Lori Goldman Sachs.
So no I don't think they'll lot's gonna come out into the real -- breast -- but it of the kinds of questions that I -- raising won't be raised.
And that's where they could be pushed and we could have answers and they don't want to be a black helicopter but we get to the bottom of this thing.
Alright Peter thank you for being in -- and -- say.
And the University of Maryland be well down in DC with C sent.
