JP Morgan Chase chief executive Jamie Dimon told the Senate Banking Committee today that he has not called heightened global banking regulations requiring banks to hold more capital “anti-American.” Dimon did, however, make that exact assertion last September when he claimed that the new global rules were aimed specifically at American banks and were thus “anti-American.”
Dimon denied that he had made the claim in response to a question from New Jersey Sen. Bob Menendez (D). Dimon said earlier in the hearing that he believes it’s a good thing that banks are more capitalized today than they were ahead the financial crisis. Menendez — who also challenged Dimon on whether the trade that caused JP Morgan’s massive loss had morphed into “Russian roulette” — asked if Dimon therefore regretted calling higher capital requirements anti-American. “No, I don’t think what you said is true,” Dimon replied:
MENENDEZ: When you reduce a hedge, or hedge a hedge, isn’t that really gambling?
DIMON: I don’t believe so, no.
MENENDEZ: So, this transaction that you said morphed, what did it morph into, Russian roulette?
DIMON: It morphed into something that I just can’t justify, that was just too risky for our company. […]
MENENDEZ: I’ve heard you talk about the ‘fortress balance sheet.’ And I’m glad to hear you say to Senator Schumer that we should take comfort that banks are more collateralized, but in saying so, one way to think about this is I wonder what your views, do you regret calling the efforts to require banks to hold more money quote ‘Un-American’ and quote ‘putting the nail in our coffin.’ Today you cite the fortress balance sheet of your bank as a way to prevent against the challenges, but you railed against us when we were in fact trying to pursue greater capitalization of these banks. Is that a regret you have of those comments then?
DIMON: No, I don’t think what you said is true.
Watch the exchange:
Dimon’s point at the time may have been that the requirements were disproportionately aimed at American banks, but that’s because it was largely big American banks that put the world financial system in jeopardy. The requirements were aimed at JP Morgan, not America, as Matt Yglesias pointed out at the time: “There’s nothing ‘American’ about an ‘American’ bank like JP Morgan that should make us think that a regulation that’s bad for JP Morgan is somehow an attack on ‘America.’”