Excerpt:
An “Investment” office sans licensed investment brokers is the latest deregulatory mutation on Wall Street. The other mutation is the JPMorgan model to create an art form out of depicting itself as a “fortress balance sheet” while holding $156 billion of capital and $66 trillion (with a “t”) in derivatives according to financial filings for March 31, 2012 with the Comptroller of the Currency.
Ina Drew, the head of the Chief Investment Office at JPMorgan in New York earned $29 million total for years 2010 and 2011. She was paid on a par with a hedge fund manager because, in essence, she was a hedge fund manager. She held no securities licenses so she was ineligible under securities law to supervise others who did hold a license; sort of like an operating room full of unlicensed brain surgeons who never went to medical school.
But even though Drew was not licensed as a principal, she was somehow supervising traders in London who were registered with the Financial Services Authority (FSA), the UK securities regulator. That included the infamous London Whale, Bruno Michel Iksil, whose trades in a credit derivative index were so large that he effectively cornered the market, pushing up the cost for American businesses to buy credit insurance on exposure they legitimately held on their balance sheets. We used to prosecute people who corner markets. But that’s so yesterday. Today, Congress just wants to study “lessons learned” like it’s fallen under a Vatican trance – there are no bad men or prosecutable crimes, just evil temptations.
Full article: How Jamie Dimon's New Business Model From Hell Could Take Down Wall Street – Again | | AlterNet.
