April 14, 2012
The year was 2008. Wall Street Banks went broke from gambling away all their money and much of their clients, requiring trillions of dollars from the US government, compliments of the taxpayers. Knowing the government will gladly do it again, most of them have restarted their gambling in a big way; evidently, with JPMorgan CEO Jamie Dimon is leading the way.
JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon has transformed the bank’s chief investment office in the past five years, increasing the size and risk of its speculative bets, according to five former executives with direct knowledge of the changes.
Achilles Macris, hired in 2006 as the CIO’s top executive in London, led an expansion into corporate and mortgage-debt investments with a mandate to generate profits for the New York-0based bank, three of the former employees said. Dimon, 56, closely supervised the shift from the CIO’s previous focus on protecting JPMorgan from risks inherent in its banking business, such as interest-rate and currency movements, they said.
Some of Macris’s bets are now so large that JPMorgan probably can’t unwind them without losing money or roiling financial markets, the former executives said, based on knowledge gleaned from people inside the bank and dealers at other firms. Bruno Iksil, a London-based trader in Macris’s group, gained attention last week after moving markets with his trades, drawing a comparison to Federal Reserve Chairman Ben S. Bernanke’s power in the government-bond market.
Never underestimate the difficulty of changing false beliefs [with] facts.
Economist Henry Rosovsky