This has become a theme: Former AIG chief executive officer Maurice “Hank” Greenberg took issue with Congress’s supposedly-rough treatment of Jamie Dimon after JPMorgan disclosed billions of dollars in losses on derivatives bets associated with the trader nicknamed the London Whale.
“It was really outrageous to have the CEO come down and testify before Congress because of a transaction that didn’t work out well,” Mr. Greenberg told Bloomberg Television today. “Many companies have transactions that go bad. …Everybody’s not paraded down to Washington to testify.”
Track back to the end of June, and Omega Advisors founder Leon Cooperman treated Bloomberg Markets to a tirade on the same subject. “I’m incensed by some of the sh– you’re reading,” Mr. Cooperman told his managers, according to the magazine. Track back another week or so still, and Lloyd Blankfein seemed to advocate for a gentler treatment of Mr. Dimon and JPMorgan. “If you put too much penalty on risk judgment, what kind of world are you going to have?” he said.
Well, it’s no surprise. As Goldman Sachs No. 2 Gary Cohn said last month, it doesn’t serve his bank to watch a rival dragged through the mud, and the same thing might apply across the financial services industry. But a couple things:
Were Mr. Dimon’s two trips to Washington last month really so taxing? If you think so, you should have watched the British Parliament’s three-hour session with former Barclays CEO Bob Diamond. Which is not to equate Barclays possibly criminal manipulation of interbank lending rates with JPMorgan’s proprietary…er, hedging losses. But simply to note thatThe Observerdidn’t think Congress treated Mr. Dimon very harshly at all; as much as anything, we thought the two rounds of hearings game the JPMorgan boss a platform to share his views on financial regulation.
And, it’s interesting to read Mr. Greenberg’s comments this week, ahead of JPMorgan’s second-quarter earnings call on Friday. When Mr. Dimon got on the phone with analysts in May after his bank disclosed its chief investment office’s recent trading losses, the tone of the call was borderline funereal—at the very least, the analysts sounded embarrassed for Mr. Dimon. With the firm expected to provide a fuller view of the losses in the days to come, we’re moved to wonder whether Mr. Greenberg was issuing a preemptive defense for Mr. Dimon, or if the steady stream of support signals that Wall Street is ready to move on…