Thursday, May 17, 2012
Baton Rouge, Louisiana
WE’RE TOO BIG TO FAIL SO LET THE TAXPAYERS COVER OUR LOSING BETS!
I drive each day by my local bank. It’s a Chase branch of J.P. Morgan. I don’t have much to save, but I count on my bank to invest my money. Not bet my hard earned dollars, but invest it. If I want to gamble for winnings, I’ll take my chances on the red and the black at a casino. I don’t need or want my bank to lay down a bet on some complicated credit default swap or other exotic roll of the financial dice. But that’s exactly what Chase has been doing with my money. They have taken a big hit. And I’m not happy.
J. P. Morgan Chase & Co. put a lady named Ina Drew in charge as chief investment officer. They paid her $14 million a year to grow my small investment. And she had a team of highly paid executives to follow her lead and see that my small savings continue to grow. But she bungled her responsibility to me and millions of other Chase savers, and now she’s been fired. Good riddance.
She apparently bears the bulk of the responsibility for a $2 billion investment loss that involved complex derivatives that were not adequately insured. There was a “make the big bucks” mentality rather than a focus on the quality of the loans that were being made.
Now don’t lecture me about taking chances and how any investment can lose money. I certainly understand, as do most Chase’s investors, that a bank investment can go bad. Yes, there is the risk that the business will fail. However, any bank should go into an investment with the understanding that it is supplying funds to a borrower that will create value. Continue reading “Jim Brown’s Weekly Column: We’re too big to fail so let the taxpayers cover our losing bets!”