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Jamie Dimon's Thoughts on Chinese Banking System
If I were a prosecutor I’d be thanking Al Gore for inventing the internet and email (I don’t know if Mr. Vice President claimed the email invention, but without the internet there is no email). Especially email, because now you can amass evidence of wrongdoing in a very searchable and easy-to-use format. TheStreet.com has dug up a very interesting email that shows what goes behind closed doors when the heads of two of the largest US and Spanish banks get together and talk. Not all of it appears to be legal – there may be collusion and an agreement not to compete for acquisitions.
I get the feeling some laws may have been broken here, but I am not a lawyer (thank God!).
But the comment that really drew my attention was not about the collusion, but what the best banker in the country – Jamie Dimon, the head of JPMorgan – thinks about the Chinese banking system. In this excerpt, an employee who was present at the meeting sums up Jamie’s thoughts on China:
Considering to buy a stake in a bank in China and asked if it makes sense to do so at current prices. Jamie replied that the concept is ok, but not now, too expensive, adding that so far "in China it is a one way street" with them wanting to get all and letting you get nothing, and that there will be more and better opportunities when China has a downturn.
Also, too difficult to know what you are buying: many of them do not yet have integrated systems, possibly a meaningful amount of political loans, etc. [emphasis added]
Jamie is not your typical banker; he doesn’t dance (like Chuck Prince) just because the music is playing. His caution, long-term thinking, and contrarianism (he cut off risky lending before everyone else) made JPMorgan a victor in the recent financial meltdown, at least in relative terms. The stock price is still down from the pre-crisis level, but it is not in single digits or the teens, like Citigroup (C ) or Bank of America (BAC). I’d be listening carefully to what he is saying about the soundness of the Chinese banking system.
Vitaliy N. Katsenelson, CFA, is a portfolio manager/director of research at Investment Management Associates in Denver, Colo. He is the author of “Active Value Investing: Making Money in Range-Bound Markets” (Wiley 2007). To receive my future articles by email, click here.
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Dear Anonymous #220245 - this sentence "I’d be thanking Al Gore for inventing the internet and email" was a joke.
Dear Eternal Student - you are absolutely right. I should have said "internet popularized email".
"I’d be thanking Al Gore for inventing the internet and email (I don’t know if Mr. Vice President claimed the email invention, but without the internet there is no email)"
Gore never claimed that he "invented" the Internet. See:
http://dir.salon.com/tech/col/rose/2000/10/05/gore_internet/index.html
The invention occurred in the seventies and allowed scientists in the Defense Department to communicate with each other. In a March 1999 interview with Wolf Blitzer, Gore said, "During my service in the United States Congress, I took the initiative in creating the Internet."
Taken in context, the sentence, despite some initial ambiguity, means that as a congressman Gore promoted the system we enjoy today, not that he could patent the science, though that's how the quotation has been manipulated. Hence the disingenuous substitution of "inventing" for the actual language.
According to Vincent Cerf, a senior vice president with MCI Worldcom who's been called the Father of the Internet, "The Internet would not be where it is in the United States without the strong support given to it and related research areas by the Vice President in his current role and in his earlier role as Senator."
The inventor of the Mosaic Browser, Marc Andreesen, credits Gore with making his work possible. He received a federal grant through Gore's High Performance Computing Act. The University of Pennsylvania's Dave Ferber says that without Gore the Internet "would not be where it is today."
Joseph E. Traub, a computer science professor at Columbia University, claims that Gore "was perhaps the first political leader to grasp the importance of networking the country.
If you had taken two minutes to do a simple search (on the internet, no less), you would have known this. Didn't anyone ver teach you not to START OFF an article with a silly statement in the very first sentence? Are you just lazy...or an amateur...or another conservative shill? All of the above?
Leo, a very short post followed by your "pump" for your products. I'm surprised you're also not recommending your book of solar stocks. How about humoring us all & do a post sans all the rubbish?
Vitaliy posted and Leo got busted.......
the e in e-mail is for evidence
Does this letter existence in the Street.com web sight means that the next round of elimination is going to begin soon?. Except this time it is going to be GS vs JPM?. Not a far fetched idea considering how they squeezed Bear and Lehman out of the way(of course I say that only because they were all insolvent,but those managed to stay up)...
me too, the chinese part is well known, there is nothing new unless you have suddenly discovered something good to say about their banks; but JPM is a house packed with interest rates derivatives, you can google that; they would be the prime short candidate the day when 10Yr hits 5%, the pain would be several times worse than any subprime.
"(I don’t know if Mr. Vice President claimed the email invention, but without the internet there is no email)."
Sorry, that's seriously wrong. Email was around long, long before the Internet was invented, or became popular. Or even available to academia.
Chinese thoughts on Jamie Dimon's Banking System:
BA-HAH-ah-hahhahaha-HA!-BAHAHAHA-aha...ah.
OK, that was much pithier than mine. :-)
+1
Yours was by far a more logical deconstruction of Dimon. And such eloquent prose...
"JPM looks to me to be another insolvent, parasitic zombie...why anyone would put a crook like Dimon in charge of anything is beyond me."
I just call him Timmay G's Uncle Jamie... and don't forget Aunt Lloyd...
Financial systems are interlocked globally now. If you look at China's banking system in isolation, then yes, it has serious problems. If Western banking systems were healthy then yes, China will implode or explode.
But the US is actually bailing out China more than it is bailing out itself. For every green job (solar panels, wind turbines, etc.) the Obama Administration creates in the US, it creates 1,000 jobs in China by outsourcing.
Because of this mechanism China has come out of the recession far sooner than the US.
While I agree with Dimon's comments on that better opportunities will come with a Chinese downturn, and his caveat emptor over the lack of transparency - which is the point of your post - I am confused as to why you seem to regard Dimon so highly. JPM is more over-exposed to the derivatives market than even Goldman Sachs, they are about to be tried for fraud over derivatives sales in Italy, and let's not even get started on their illegal activities in the metals paper markets. This kind of 'contrarian, long-term thinking' is what has brought the OECD empire to its knees.
JPM looks to me to be another insolvent, parasitic zombie...why anyone would put a crook like Dimon in charge of anything is beyond me. That he isn't in jail makes me sure that this Depression is far, far from over.
Which is probably why I'd never make it even out of the starting gate in politics...
Agreed. It's going to take some heads swingin from the lamp posts to end this systemic infection...
I'm more a guillotine guy myself but nooses and lamp posts wouldnt require a hazmat team.
Wise choice.
OK, this is where politics gets good! Finally, a viable third party?
Democrat party
Republican party
Necktie party
Personally, I think that too many third parties take hard line stances that make them unacceptable to the mainstream. If they tried to be a little bit more "bland" they might be viable in elections. Instead, it seems like they take stances that are vastly unpopular, although somewhat correct ideally.
With that said, if somebody was all about hanging crooks from the lampposts, I'd vote for them!
If I understand correctly, China owns its central bank. It also owns its citizenry and the means of production. China's banking system could be and probably is worse than ours. At the very least it is exposed to the will of the integrated Euro/American/Japanese central banking system if it gets a bee in its bonnet.
I wouldn't be surprised to see China doing a lot of journalistic damage control soon as they struggle to spin the carnage that is about to ensue.
Like with human rights and global climate stupidity, the Chinese have a healthy dose of "don't give a shit" about the other central banks. As long as they stay pegged to the USD, they can create as many Yuan as they need and tell everybody else to shove it.
China's banking system is owned and operated by its developmental state. They're not going to let the banksters within 10,000 km of China's hard-earned national savings.
This guy dimon is A crook and he needs to go to jAIL WITH his buddy blankfein
Geez man...You sound like Erin Burnett trying to get into Dimon's pants. He's a crook man, nothing more - nothing less. As for the Chinese banking system, they can't be any worse the the banking systems of the Western countries. It's only a matter of time until this whole damn ponzi is finally forced to reboot.
you are wise with your plainview. dimon is stupid. i know for a fact that david bonderman with TPG Capital are competing to buy a one-third stake in China International Capital Corp and have been buying chinese national banks. david bonderman is far more successful and smarter private equity guy than dimon could aspire to be. has been interested in china and south korea for a while.
Bonderman's investment in Washington Mutual underscores his successful investments.
Agreed.
If the truth ever comes out about the banking bailouts and what led to them, Dimon would be led off in handcuffs!
Corruption as far as the eye can see