NOW Are We Allowed Talk About Firing Jamie Dimon?

NOW Are We Allowed Talk About Firing Jamie Dimon?

If he hasn't lost it already, JPMorgan Chase CEO Jamie Dimon should probably lose his title as America's greatest banker. Maybe it's also finally time we talk about him losing his job.

JPMorgan, the biggest U.S. bank by assets, on Friday reported a $380 million loss in the third quarter. Its results were slammed by a flabbergasting $9.2 billion in legal expenses arising from the bank's many, many wrongdoings -- alleged and/or admitted -- all of which have occurred on the watch of Dimon, once considered the world's greatest bank CEO. These included settlements of alleged energy-market manipulation, allegedly bad credit-card practices, and admitted securities-law violations in its handling of the "London Whale" trading debacle last year.

The bank's quarterly legal hit was about 50 percent higher than the $6 billion or so it lost as a result of the London Whale scandal, which happened partly because Dimon commanded his staid chief investment office to take bigger risks, and it eagerly obliged. The bank has paid about $1 billion in fines so far because of that incident. The bank now spends more money on legal and regulatory battles than on anything else -- including worker salaries, rent or buying securities, Tim Fernholz points out in Quartz.

And there is more to come: JPMorgan is still trying to settle other government charges, including what could be an $11 billion tab for mortgage-debt sales ahead of the financial crisis. Most of that particular mess is not Dimon's fault, as most of the alleged wrongdoing was committed by Bear Stearns and Washington Mutual before JPMorgan bought those banks during the crisis.

Anyway, JPMorgan has set its legal reserves at an astonishing $23 billion, a giant lake of money from which plaintiffs' lawyers will be dipping for years to come. The kicker is that this bank, once widely considered the best-managed in the universe, also said on Friday that it was shocked, shocked by how much its legal expenses piled up in the quarter.

The giant quarterly loss was the first of Dimon's eight-year tenure as CEO, which has gone from storied to stormy. It erodes the main defense usually raised by his supporters -- a group that includes most JPMorgan shareholders, all of Wall Street, and most of the financial press, really -- that we should judge Dimon only on the money he makes and not by such niceties as making sure his bank isn't constantly getting into trouble.

That defense was on full, pathetic display recently on CNBC, when presenters Maria Bartiromo and Scott Wapner and Fortune columnist Duff McDonald ritually eviscerated liberal Salon blogger Alex Pareene because he dared to suggest that Dimon lose his job over the many embarrassments the bank suffered on his watch. Bartiromo, Wapner and McDonald didn't even bother to conceal their disgust with Pareene and his foolish suggestion.

"Should we talk about the financial strength of JPMorgan at this point?" blustered Bartiromo, who at one point literally threw her hands in the air in outrage. "I mean, even with all of these losses the company continues to churn out tens of billions of dollars in earnings and hundreds of billions of dollars in revenue. How do you criticize that?"

"This is preposterous," McDonald sneered at Pareene's idea. "The stock's touching a 10-year high, it's a cash-generating machine. Sure, they've had their regulatory issues, but he's looking to settle them expeditiously at this point, which is everything you want out of a CEO. It's an absurd suggestion."

And, sure, the bank is still making a lot of money, one quarter aside. It made $13 billion in profit in the first two quarters of the year, more than making up for its third-quarter loss. The stock price is indeed around a record high.

Then again, JPMorgan is almost certain to make tons of money no matter who is the CEO, be it Jamie Dimon or a blob fish. It is practically impossible for the world's biggest bank to fail, by virtue of it being, you know, Too Big To Fail. The epitome of Too Big To Fail, in fact.

It may also be, as Pareene suggested, impossible for any person or blob fish to manage a bank of such size and sprawl and keep it out of constant trouble.

But Dimon's unique hubris, his elephant-sized Truck Nutz, were what turned JPMorgan from a reputed paragon of banking strength into a lightning rod for public anger at the banking sector. Rather than being content to do God's work, Dimon has busied himself in the years since the crisis with constant whining and complaining about banking regulations, while darkly warning that any efforts to tie his bank's hands could result in economic catastrophe. Now his bank is Exhibit A for those who think banks aren't regulated enough.

Maybe this poetic justice is all Dimon deserves. It may be all he's going to get: Shareholders seem in no hurry to toss him. In fact, they recently made sure he'd keep both of his jobs at the bank, as CEO and Chairman of the Board.

But shareholders would go a long way toward restoring the reputation of the bank, and the entire sector, if they showed Dimon the door instead.

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