Shocking, I know. But this is too much:
JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon said bond markets would spurn U.S. debt if lawmakers fail to reach an agreement to address the nation’s deficit.
“It’s virtually assured” that markets would react that way, Dimon said today in Washington at an event held by the Council on Foreign Relations. “The question is when and how.”
Being one of the largest beneficiaries of the government debt machine, one might think this was a man speaking for the good of the economy and the little people.
He was asked today whether bond markets would turn against the U.S., which has been able to borrow at near-record-low rates.
“I can’t honestly tell you I know it’s going to be two years or five years, but it will happen,” Dimon said. “It is a matter of time and the United States can’t borrow indefinitely.”
This is his own punch bowl that he is soiling…what a caring guy!
Dimon said New York-based JPMorgan has assigned staff to prepare the bank for the possibility that lawmakers remain deadlocked through the beginning of 2013.
“JPMorgan will survive the fiscal cliff,” he said. “I just think it’s terrible policy to allow us to get close.”
There is no cliff – virtually all government spending is continuing as usual. And a deal is certain to come in any case. The cliff that is his real concern is the one associated with Fed money printing.
In a calm appraisal of the events of 2008, Dimon reflects:
He said JPMorgan did the U.S. a favor by buying Bear Stearns in 2008 and he might not go through with it again because of how much the deal ultimately cost.
“We were asked to buy Bear Stearns,” Dimon said today. “We did them a favor. Let’s get this one exactly right. We were asked to do it, we did it at great risk to ourselves.”
Hahahahaha. Hohohohoho. Heeheeheeheehee. Guffaw, guffaw, guffaw.
He did no one a favor. He did what he had to do in exchange for the survival of JPM. Every single large bank was at risk of bankruptcy without Fed and Treasury support in 2007 / 2008. Dimon knows this, and this is why he agreed to accept the favors handed out by the Feds.
The conversation went something like this:
Paulson: Jamie, you have to take over Bear Stearns.
Dimon: That dog? I wouldn’t touch it with a ten foot pole.
Paulson: You know what we have planned for Lehman because Fuld wouldn’t play during the LTCM crisis? We can easily change the target of our object lesson.
Dimon: Where do I sign?
“Would I have done Bear Stearns again knowing what I know today?” Dimon asked today. “It’s really close. Knowing what I know today, if they called me again to do something again like that, I couldn’t do it.”
Translated: I plan on retiring once I get word that the sh*! is about to hit the fan. So my successor will do it if the bank is to be the recipient of the next round of Fed largesse.
The board of his bank probably would veto the idea because of all the financial obligations that followed, he said. “We’ve lost five to 10 billion dollars on various things related to Bear Stearns,” Dimon said.
Not if they want to save JPMorgan.