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Backstory: Matt Taibbi on JP Morgan Chase

Thursday, May 17, 2012

Matt Taibbi, Contributing Editor for Rolling Stone , joins us to talk about the recent $2 billion-plus loss at JP Morgan Chase and the state of Wall Street. Taibbi is the author of Griftopia: A Story of Bankers, Politicians, and the Most Audacious Power Grab in American History.

Guests:

Matt Taibbi

Comments [13]

anna from new york

I must clarify.
I meant to say:
"No calling Chase as something wrapped around something, no directing all discussions about Wall Street or criminal bankink to Chase.

May. 17 2012 01:56 PM
Bobby G from East Village

You guys say that these transactions are hard to explain, but I think its very straight forward.

First, they are bets on an index, could go up, could go down. The index is not an asset (corporate debt or whatever), its a number based on the movement of assets. Its not unlike the bookies I used to see at the old lunch counters on the Lower East Side. Then, the bet is compounded -- here's where it is worse than the bookies -- by selling insurance on the initial bet.

Poof: $2,000,000,000

May. 17 2012 01:53 PM
sanych

A lot of summation, but absolutely nothing new...

May. 17 2012 01:48 PM
anna from new york

Thank you, Leonard for inviting this fine gentleman. Mr. Taibbi doesn't know why Chase had good reputation, but I can help here. Chase is my bank and I watched its criminal activities during the last decade. I was wondering why a friend of mine (now firmly ex), a house wife without children and other responsibilities who loves both Chavez and Ron Paul and any Nazi in sight was always switching from a discussion of "badness" of Chase (natural in my case) to the badness of Bank of America. Neither bank was hers. I figured out why only when I finally checked both CEOs religion-ethnicity. Yes, my ex-friend is now in a neo-Nazi camp. In other words, the so called "progressives" treated Chase and Dimon differently. No calling Chase as something wrapped around something, no directing all discussions about Wall Street or banking to Goldman and Bank of America, . BTW, if Mr. Taibbi is interested to joining my "friend" for interesting conversation about "wrapping around" or an authentic place for him, I can refer him.

May. 17 2012 01:48 PM
jawbone

Matt, Wall Streeters were big, big backers of Obama prior to his announcing for the Dem primary. They gave him his seed money, and they have been well recompensed. They absolutely did not trust Hillary Clinton to give them kind of coddling Obama apparently had told them he would provide.

They backed a Dem because it was going to be almost impossible for a Republican to win the presidency in 2008.

Obama sold himself to the public as FDR Redux, but he sold himself to Big Money as a Neolib conservative with purported social liberalism.

Voters were bamboozled; the Street knew damn well what it was getting.

Now, the Street is saying why go with a Dem when they can have an Uber-Kleptocrat Uber-Greedhead in Romney. They may be playing it wrong, because without Obama as president some Dems, enough Dems, may realize they should pay attention to their base and the principles of yore of the Democratic Party.

May. 17 2012 01:47 PM
Hugh Sansom

Two or three years ago, Mr. Lopate had a guest who had a book out and who had worked at one of the big investment banks as a high-end software engineer. That programmer described being _directed_ to adjust algorithms to get desired outcomes.

As for Obama, the banks know that by moving their funding to the roght, they can get Obama to move further to the right than he already has (and Obama has been a huge friend to the banks).

May. 17 2012 01:44 PM
John A. from "Bedford Falls II"

'I'm moving to a credit union'
I've heard that before recently. Sounds like the turning-point where George Bailey ("It's a Wonderful Life") wins out over Potter. There was a key essay written in 2001 ("All hail Pottersville!" by Gary Kamiya) that our culture of greed had indeed made the Potters in this world the winners.

May. 17 2012 01:43 PM
Michael D. D. White from Brooklyn Heights

To what extent might access to to the $7.7 Trillion back-doored by the Fed (or whatever was in place at the time)have been factored in as background when JP Morgan Chase was making the "hedge" bet that resulted in its recent $3 billion loss?

May. 17 2012 01:42 PM

It seems like the time is right for changing the catch-phrase from "Too Big To Fail" to "Too Big To Save."

2nd phrase suggested by someone else, not me.

May. 17 2012 01:39 PM
jawbone

Proofreading is a good thing,

It's the movie "Margin Call."

And Dimon is one of the most arrogant grovelers I've ever seem. Obviously he's been told to act contrite. But is not in any way, except at being caught with a PR mess on his watch.

May. 17 2012 01:39 PM
jawbone

Anyone else reminded of the recent mover, "Margin Call"?

Right down to the big boss having had warnings, but urged risky bets, and then a female exec is the sacrificial lamb to show the Street, government, and the public that the big boss is so upset about the underlying actions.

May. 17 2012 01:35 PM
Peg

Why do we allow bankers to invest in 'instruments'- deals that even they admit are too difficult to get an accurate account of what's happening with the money. Or even worse - how much money is real or fake? It's a House of Cards 'you pay your money, you take your chances' - what a mess!

May. 17 2012 01:34 PM
Victoria from Brooklyn

Could you please ask your guest a question for me. I understand that this is a crisis for JP Morgan but since the money was lost in derivative trading didn't other investors benefit from their loss? If so, why so much concern?

May. 17 2012 01:26 PM

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