The Smartest


If JP Morgan’s Jamie Dimon is the smartest or one of the smartest CEOs on wall street, I think Matt Yglesias’ question is pertinent:

Which reminds me that in all the ruckus around these events there’s been remarkably little focus on what I think is the most important political issue of them all—does the Dodd-Frank bill provide a workable framework for resolving the bankruptcy of a large multinational bank or doesn’ it?

source: What Really Matters In JP Morgan’s Trading Losses.

If Jamie Dimon is one of the best, and for the sake of argument I’ll take the word of those folks who’ve said that he is, then what JP Morgan’s “ironclad balance sheet” shows that even for geniuses the desire to roll the dice and bet big also matters. Money Makin’ Dimon made JP Morgan 15b, $2b $9b in loss was all due to Dice Rollin’ Jamie.

If he’s the smartest and that happened: shouldn’t we expect to learn of some other bank CEO who is letting risk run amok for the thrill of the bet and the upside of being right? After the last 10 years, I would say yes. Can we expect them to be less of a money maker and more of dice roller than Dimon? I would say yes.

Probably. So again, this question is key: in practice, not theory, if a bank of this size fails can the CFPB properly wind them down and protect the economy?