Everyone now knows that Jamie Dimon is the king of Wall Street. Girls at hedge funds have crushes on him. He's been on the cover of New York magazine, towering over the city. They're calling him "King James."
For the most part, the ascendency of Dimon has been due to the fact that JP Morgan successfully avoided falling into the chasm of subprime mortgages into which so many of his fellow chief executives drove their banks and brokerages. Fortune's has a long profile that describes Dimon's management style, and precisely how he pulled JP Morgan back from the subprime brink.
Dimon favors boisterous meetings that delve into detailed analysis of his bank's business. Fortune's Shawn Tully reports that people describe these variously as "Italian family dinners" and "the Roman forum." There not a lot of kow-towing to the big man, apparently. Ideas are debated vigorously and sometimes Dimon backs down. He wanted to get JP Morgan to go "open source" with the financial products it sold, selling clients on products developed by competitors. But one of his lieutenants eventually talked him out of it, convincing Dimon that JP Morgan's homegrown products were performing as well as anyone else's.
The subprime call--literally, a call to the head of structured products who was on vacation--came from Dimon after a meeting discussing the performance of the retail bank. In October 2006, the mortgage servicing business was reporting that late payments on subprime mortgages were rising at an alarming rate. Dimon and his team concluded that quality control had slipped at the originator level and decided to slash its holdings of subprime debt. It was this leap from the granular details to the bigger picture that enabled JP Morgan to make the right call on subprime while so many others were still rushing headlong into what was one of the hottest businesses on Wall Street.
We can't help but wonder if there are, in the Dimon and subprime story, the seeds of an even greater story defending the efficacy of the mega-bank. After all, it was the fact from a retail business that tipped Dimon off to a strategic change at the investment level. A smaller brokerage or investment bank would not have had access to this data. Maybe its not the model of mega-banks that's broken, after all.
Jamie Dimon's swat team [Fortune]
Posted by guest , Sep 02, 2008 1:26PM
First Bitches!
SPODE
Posted by guest , Sep 02, 2008 1:28PM
Jamie just wants Sandy to love him and realize what a mistake Sandy made by firing him
Posted by guest , Sep 02, 2008 1:35PM
If the info wasn't public and they made investment decisions on it ... ???
Posted by guest , Sep 02, 2008 1:37PM
He used a lot of Mayo.
Posted by guest , Sep 02, 2008 1:37PM
solid analysis
Posted by guest , Sep 02, 2008 1:41PM
Used a shamwow to wipe up the mess.
Posted by guest , Sep 02, 2008 1:46PM
wouldnt have happened at Deutsche Bank, retail and institutional, and corporate and Investment dont talk to each other...in fact they spit at each other in the street such is the inherant hatred.
one bank bollox... its about 5 units all desperately trying to outdo each other... its a wonder they didnt get hammered more.
Posted by guest , Sep 02, 2008 1:54PM
yyyyaaaaawwwwwwnnnnnnnn
Posted by guest , Sep 02, 2008 1:55PM
didn't happen at Opco, nor CIBC, nor Sterling Agee, nor any other boutique shop
did happen at 90% of all large firms though
Posted by guest , Sep 02, 2008 1:57PM
avoided subprime? ok, if you say so.
jury's still out on credit card master trusts.
Posted by guest , Sep 02, 2008 2:02PM
Now, if only their remaining holdings weren't so completely and intentionally mismarked.
Posted by guest , Sep 02, 2008 2:09PM
Such BS that Jamie saved the day. It was the former head of fixed income (Edspar)and the former head of structured products (Bill King)that trimmed back the warehouse facilities and limiting inventory of subprime. And where are both of those brilliant gents now? Citadel!
Posted by guest , Sep 02, 2008 2:11PM
Too bad Chase has the largest credit card portfolio in the universe and will suffer the same fate as many others in the financial sector.
Posted by guest , Sep 02, 2008 2:16PM
chase did not much subprime exposure when it bought bank one in early 2004, a fact dimon's citi/bank one cronies used to illustrate how incompetent the legacy chase management was (`they really missed the boat on that opportunity,' they said). dimon may have kept the bank from chasing that business once he got there, but to suggest that his guys proactively backed away from it is revisionist history.
Posted by guest , Sep 02, 2008 2:21PM
Dimon has some mighty fine PR.
Posted by guest , Sep 02, 2008 2:26PM
Jamie's mom ghost-wrote the article.
Posted by nybasic , Sep 02, 2008 3:07PM
I am a former JPM employee, and I'm definitely kinda' wishing i never left. they are the only ship who isnt bailing water or sinking. Crap. Dah' well.
Posted by Anal_yst , Sep 02, 2008 5:58PM
@ 7
There's no way in hell DB is nearly the worst in that sense...
@3
I think you're misunderstanding the phrase my friend...
Posted by guest , Sep 02, 2008 7:34PM
Premise may be valid: being a big bank doesn't necessary mean stumbling like 2000 pound lemming. OK?
&&&
What I like about Dimon is this: they say he belted someone at a party.
True? Who knows.
Just the fact that they SAY it makes him my kind of guy.
Posted by guest , Sep 02, 2008 7:34PM
Premise may be valid: being a big bank doesn't necessary mean stumbling like 2000 pound lemming. OK?
&&&
What I like about Dimon is this: they say he belted someone at a party.
True? Who knows.
Just the fact that they SAY it makes him my kind of guy.
Posted by lemmerdeur , Sep 02, 2008 8:36PM
Perhaps he had a team of crack blog sifters who brought it to his attention after reading about it on one of the dozens of blogs that was screaming about this shit since at least 2004. You know, years before MSM, years before regulators, years before almost any financier or banker types.
Posted by guest , Sep 03, 2008 1:13AM
@ 19/20
We read too much about Citi, sorry.
-Andrew
Posted by guest , Sep 03, 2008 7:14AM
@18 Anal_yst.
I didnt day DB was the worst, but just wondered in a lazy late summery afternoon kind of way why their almighty infighting didnt cost them more? And that the infighting, had it been limited (or less encouraged), may have even cost them less.
Clearly the current "announced" balance sheets are the final proof of a cock up (no disrespect intended)..
Posted by guest , Sep 03, 2008 8:12AM
stop giving dimon so much credit, he has never grown anything, all jpm p&l is from takeovers/cost-cutting...jpm is a big retail bank in disguise.. and the employees are his tellers
Posted by guest , Sep 03, 2008 9:31AM
24 I'm gonna disagree. I-banking is a hobby at the other universal banks, but not at JPM. They're the only ones giving the bulges a run for their money.
Posted by guest , Sep 13, 2008 6:26PM
JPM is still not out of this subprime mess. Wait till it is finally over and let us see where JPM sits then.
Posted by guest , Dec 13, 2008 10:29AM
Chase Bank through the leadership of Exec V. P. Mark Willis is partly responsible for the collapse of the housing market through their irresponsible lending practices to low to moderate income people who werent qualified for homeownership. Check out all their grants and affiliations with radical community groups like Acorn and Hope.