Thursday, July 23, 2009

Speaking Of JP Morgan

This was an interesting article on the nuances of how things really work at the FRBNY as well as other branches of Wall Street, sorry Government.

"Mr. Dimon and Mr. Geithner know each other well from the Federal Reserve Bank of New York, where Mr. Geithner was president and, as such, a JPMorgan regulator. Mr. Dimon sits on the New York Fed’s board. The two men spent untold hours negotiating in 2008 when the government enlisted JPMorgan to buy some of Bear Stearns’s assets and Washington Mutual to prevent their collapse. Mr. Dimon said the two had spoken by phone perhaps 10 times this year".

Quick point on WAMU. This institution was stolen in the middle of the night by Shiela Bair and the FDIC. WAMU realistically could have gone on for 2 years even at their current loss rate. The inside story here was JP Morgan needed WAMU's assets/deposits to raise their own sinking common equity ratios.

Whats really infuriating is the incestuous relationships and the reach to which these relationships are used for the so called good of society.

Further Reading:

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