Caught on tape. Dimon loves leverage.
Dimon responds to analyst Mike Mayo on capital ratios.
Why Jamie Dimon Is Richer Than You
That, indeed, is why Dimon is richer than most of us. He's not gotten rich running a bank on 19th-century lines, conservative with high capital to make its tony clients comfortable. He's gotten rich, and he's not alone, running banks with high leverage under loose regulatory regimes.
J.P. Morgan shareholders, it should be noted, have done a lot less well. Since Dimon became president and COO in July 2004, the bank's stock is up about 30 percent. Since he became both chairman and CEO in 2006 it is up barely at all.
The real issue isn't who is rich, but rather whose interests are being fairly served and whose aren't. Dimon's approach gives short shrift to both shareholders and taxpayers who, by the way, are still carrying substantial risks for which they are not being compensated.
More on leverage.
Henry Paulson, when he was still CEO of Goldman in 2004, successfully lobbied the SEC to change the rules on capital ratios.
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