Randomly Noted

When it comes to annual letters to shareholders, Jamie Dimon is no Warren Buffett.

Dimon, JPMorgan Chase’s chairman and chief executive, recently deposited 37 pages on unwitting holders that included none of the folksiness nor clever turns of phrase that pepper the writing of the famous Omaha investor.

Somebody should have told Dimon, arguably the most influential person in banking, that 37 pages is just too long and a little humor never hurts.

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Morgan Stanley CEO John Mack recently appeared before a group at the Wharton School of the University of Pennsylvania and recounted the events of that one week last September that nearly brought down the global financial system. For anyone interested in global finance, it is a must view (it runs a little over 26 minutes). There are some stunning details – how federal regulators were pressuring Morgan Stanley to sell itself to J.P. Morgan for $1. How Mack had a firm conversation with J.P. Morgan CEO Jamie Dimon about speaking with Mack directly on any acquisition talks, and not his subordinates. His frequent phone calls with Goldman’s Lloyd Blankfein, who told Mack he had to find a way to rescue Morgan because if it failed, his firm might be just 20 minutes behind. And how and why Mack hung up the telephone with the three most powerful regulators in the U.S. Click on the image above to see the video or click here.

As the debate on regulatory reform of the financial services industry heats up in Washington, the head of one of the world’s largest banks took to the op-ed pages of the Washington Post today to push his vision of reform. J.P. Morgan CEO Jamie Dimon may surprise some by arguing that the “too big to fail” doctrine should be tossed out the window. After all, such an approach protects his bank and the industry in general. His concern isn’t about protecting those troubled banks but instead in Washington efforts that could lead to a cap on how big banks should be allowed to get. Big is better is done with proper risk management and regulatory oversight.

Dimon argues that when a big bank gets into trouble, it should be allowed to unwind much in the way FDIC assisted bailouts are engineered today – with shareholders and subordinated creditors taking it on the chin.

There is much good logic to his argument. The problem, of course, is that the argument is all predicated on strong risk management and controls and a proper level of regulation. And that’s exactly what was missing at the beginning – and end – of the credit crisis.

It’s got to be fun being Jamie Dimon, sitting atop the banking world (along side Goldman Sachs) and spouting off one-liners such as: The U.S. needs a strong dollar. Yes, Mr. Dimon, we need a strong dollar – and how, exactly, do you propose to strengthen the greenback? Would you be happy if Ben Bernanke & Co. started hiking rates – say, tomorrow? Would that be good for an economy on the verge of 10% unemployment? Have you looked at third-quarter corporate earnings reports? Do they really give you confidence that business and consumer demand is robust enough to justify Fed tightening? I’m not saying Dimon doesn’t have a right to his opinions; the annual meeting of the securities industry association is certainly an apt forum. But surely one of the world’s foremost bankers – Dimon runs JPMorgan Chase & Co. – should offer some nuanced elaboration from the podium. Here’s something else Dimon wants: less government regulation of banks. “We are in favor of consumer protection, but we believe we have a chance to simplify regulation rather than add another agency,” he said. Moreover, big banks on whose shoulders the health of the global financial system rests – the government shouldn’t “hamstring those companies,” Dimon said. Yep, simpler regulation will spot, forestall and fix impending banking disasters. I rest my case.