Receiving Wide Coverage ...
All Dimon, All the Time: Yesterday’s two-hour Senate Banking Committee hearing on the JPMorgan Chase trading losses, starring CEO Jamie Dimon, dominates the morning papers’ banking coverage. Given the complexity of the topic and the competing interests and personalities involved, the contradictions in the storyline are probably inevitable, but still striking:
A thousand pardons/Don’t tread on me. After admitting he was “dead wrong” to initially scoff at concerns about the chief investment office’s trading, the Journal’s main story says, Dimon “pivoted to remind lawmakers that he has the ‘right to rely’ on the assurances being given to him by his top executives.” Similarly, the main story in the Times (which bears the behold-the-god-who-bleeds headline, “‘Proud’ JPMorgan Chief Apologizes”) leads by saying he “apologized for the mishap on Wednesday even as he mounted a fierce defense of his bank.”
I own it/They broke it. An editorial in the Journal approvingly says the businessman “declined to blame anyone but his own management team for the bank's $2 billion trading loss, saying ‘the buck stops with me.’ You won't hear that in a thousand years of Senate debate.” The FT’s news article gives a slightly different impression of the same remarks, starting with the headline, “JPMorgan Chase chief blames executives.” The British paper’s story leads with Dimon telling the lawmakers “he was unaware the bank’s chief investment office was accumulating large losses because he was ‘assured’ by his top executives there was only an ‘isolated, small issue.’”
Lobbing grenades/Lobbing softballs: The top of the Post’s story highlights Dimon’s apologies, without mentioning pivots or fierce defenses, says the senators “demanded more” from him and replays back-and-forth exchanges with incredulous-sounding lawmakers from both parties. (Dimon is also described as “chastened.”) But an article in the Journal says the pols “largely deferred to Mr. Dimon, tossing out mostly softball questions and generally declining to criticize the silver-haired executive as many had expected.”
The real issues. These, unfortunately, got short shrift, both in the hearing and the coverage of it. Journal columnist David Weidner laments that as Dimon charmed the panel and spectators, “so many questions weren't answered clearly. Among them: Why was the bank's risk committee so loaded with members who weren't banking professionals? Why were warnings about risk controls and systems overlooked for so long? Why were securities valued higher at the division responsible for the trade than by other parts of the bank?” In the bigger picture, Weidner writes, the “uncomfortable relationship between the interests of a private banking institution and the economic interests of citizens is the critical issue that seemed to get lost.” We wonder if the media’s fixation on “drama” and “the human side of the story” helps to obscure these issues, and in any event it feels a bit patronizing to the reader. “Abstractions like VaR models and Basel risk weightings won’t play well in Peoria” seems to be the underlying assumption. Fortunately, the wonkier columnists — Peter Eavis on the Times’ “DealBook” blog and David Reilly on the Journal’s “Heard on the Street” team — delve into these supposedly boring but undeniably important subjects. Your Morning Scan has run out of time to summarize them, so just read them yourself, and then tell us if you agree that “people” is sometimes an overrated topic.