JPMorgan Chase CEO Jamie Dimon compares market-wide bridge loan exposure before the 2008 financial crisis to contemporary levels.
Disclosure
Dimon: $5B Mortgage Penalties Led Him to Never Trust the Government Again
“They made us pay five billion dollars on the more, the bad mortgages that Bear Stearns had done, and that's what made me make the statement I wouldn't do it again. I wouldn't, put it this way, I don't know how to say this, I wouldn't really trust the governmen…”
Assertion Not checkable as stated
Dimon: Bank One held more credit risk than Citibank under aggressive accounting
“I quickly realized that BankOne had more U.S. Corporate credit risk
Than Citibank did.
And they, the way they accounted for it was unbelievably aggressive.
And, you know, so they had less capital, less reserves, less this.
They were calling these things profit…”
Assertion Not checkable as stated
Dimon: Banks earning 30% ROE pre-2007 mostly went bankrupt in 2008
“If you look at the history of banks from up until 2007, a lot of banks were earning 30% equity.
Most of them went bankrupt.
We never did that much.
Okay.
But in oh eight and oh nine, we were fine and they weren't.”
What-if
Dimon: An Unrescued Bear Stearns Would Have Triggered Immediate Financial Collapse
“It would have been gone, and the crisis would have just unfolded”
Assertion Supported
Dimon: 80% of Federal Mortgage Settlement Targeted Bear and WaMu Conduct
“80% of what they're asking for related to Bear Stearns and Wamuu, not JPMorgan Chase.”
Opinion
Dimon: The $2T private credit market is not a systemic risk
“So there, it may, there may be something in there that would become a problem one day. I don't think it's systemic. So that two trillion, the mortgage market when the time it blew up was, I'm going to say, nine trillion, and a trillion dollars was lost.”