This Sunday, JP Morgan Chase CEO Jamie Dimon appeared on Meet the Press to defend his entire industry after it was revealed earlier in the week that his bank had lost $2 billion betting a strong economic recovery. “We know we were sloppy. We know we were stupid. We know there was bad judgment,” Dimon said. “But we intend to fix it, learn from it, and be a better company when it’s done.”
But Democrats, of course, want more than that. They want to use this loss (which is smaller than the $3.2 billion loss the US Postal Service announced this quarter) as an excuse to increase government control of the financial sector. “We wrote a law. They call it the Volker Rule at times,” Sen. Carl Levin, D-Mich., said later in the same show. ” And we prohibit the kind of bets that were made here. … And so we’ve got to be very, very careful that the regulators here are not undermined by these huge effort to weaken the rule.”
Except that, as The Heritage Foundation‘s David John points out, Levin’s Volcker Rule would have done nothing to prevent JP Morgan’s recent losses: “JP Morgan Chase’s losses were due to hedging, an activity designed to reduce the chance of losses from other bank activities. Such hedging would not be restricted by the Volcker Rule.” More importantly, these losses are completely manageable for JP Morgan: “A $2 billion loss is huge, but Chase has more than enough capital to absorb it. As a $2.3 trillion bank with a net worth of $189 billion, this $2 billion loss reduced the bank’s capital ratio from 8.4 percent to 8.2 percent. The bank is nowhere close to needing any form of federal intervention,” John explains.
Democrats, however, see everything that Wall Street does as an excuse for more government control. Let’s say JP Morgan had gained $2 billion instead of losing $2 billion. Does anyone doubt tat Democrats would be using that news to call for higher taxes on Wall Street? As President Reagan told the White House Conference on Small Business in 1986, “[G]overnment’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
Obama: Newsweek has dubbed Obama “The First Gay President” and devoted the cover of this weeks issue to last weeks announcement on gay marriage. Obama will also play up the “War on Women” when he speaks at Barnard College’s commencement today. The Obama campaign also is on the air with two-minute ads in Iowa, Ohio, Pennsylvania and Colorado and Virginia attacking Mitt Romney’s tenure at Bain Capital. The Obama campaign also unveiled a new site, RomneyEconomics.com.
Romney: Mitt Romney was well recieved at the Liberty University commencement ceremony Saturday. You can read his full speech here.
Charlotte: Democrats have trumpeted their ban on corporate donations to their national convention this summer, but through a special fund, Democrats are accepting millions of dollars in corporate contributions to help pay for many of the activities outside the convention hall.
Massachusetts Senate: Elizabeth Warren is calling on JP Morgan CEO Jamie Dimon to resign from the Board of Directors of the New York Federal Reserve Bank
Around the Bigs
The Miami-Herald, More are renouncing U.S. citizenship as IRS cracks down: A growing number of U.S. citizens who live abroad and have bank accounts there are making a radical decision to avoid paying taxes: They’re giving up their U.S. citizenship.
The Associated Press, Around world, Obama’s presidency a disappointment: In a world weary of war and economic crises, and concerned about global climate change, the consensus is that Obama has not lived up to the lofty expectations that surrounded his 2008 election and Nobel Peace Prize a year later.
The Wall Street Journal, Economists Forecast Subdued Growth in 2012: Forecasters surveyed by The Wall Street Journal expect the economy to add just 185,000 jobs a month over the next year. Unemployment is expected to be 7.9 percent by the end of the year.
Reuters, Brown pushes tax hike as California’s money woes deepen: California Governor Jerry Brown announced on YouTube yesterday, that California has a $16 billion deficit and encouraged voters to support tax hike initiatives this fall.
The Los Angeles Times, Bullet train may need $3.5 million a day: In order not to lose its federal funding, California’s high-speed rail project must spend $3.5 million a day and be completed by September 2017, making it the fastest infrastructure project in the nation’s history.
The Wall Street Journal, Europe Stocks, Euro Under Pressure: European stocks fell sharply Monday, the euro lost ground against the dollar, and bond yields hit new lows as investors scurried to safety, after the latest attempt to form a coalition government in Greece failed.
The Washington Post, Mexican cartel dumps 49 torsos along highway: The headless torsos of 43 men and six women were found early Sunday along a highway between the U.S. border and the northern Mexican city of Monterrey, the latest in an escalating series of horrific mass killings among warring drug gangs here.
The Weekly Standard‘s Jeffrey Anderson notes, that according to the White House’s own stmulus numbers, it cost Obama $278,000 to save each job.
AEI‘s James Pethokoukis highlights a new study showing that high taxes, not spending cuts, are killing Europe’s economy.
At RedState, Rep. Morgan Griffith, R-Va., details what the Mainstream Media Isn’t Reporting About Solyndra.
The Washington Post‘s Sarah Kliff explains what Nancy Keenan’s resignation means for abortion rights activists.
Talking Points Memo Sahil Kapur wonders if the White House is hurting themselves by ordering amnesty advocates not to work with Sen. Marco Rubio, R-Fla.
Think Progress posts 5 mindblowing facts about student debt.