Wall Street’s Big Boys Bulldoze Through the Spending Bill They Want
Stock-Markets / Financial Markets 2014 Dec 16, 2014 - 04:17 AM GMTBy: Money_Morning
Shah Gilani writes: We’ve got a spending bill, folks!
The government of the United States will remain open for business thanks to the usual suspects in Congress being open to being bought.
Sometimes it only takes a few phone calls from a deep-pocketed giant bank CEO to remind legislators who butters their bread.
According to Sunday’s Financial Times, bread-butterer par excellence Jamie Dimon, chairman and CEO of mega-fat JPMorgan Chase & Co. (NYSE: JPM), worked the phones hard last week. He called on his legion of congressional peeps and perps to pass the $1.1 trillion spending bill as written.
Why did this patriot risk getting calluses on his fingertips for some pipsqueak legislation?
Read on and I’ll tell you what I think – and I’ll show you what it means for all of us going forward…
Dialing for Dollars
Dimon desperately wanted the spending bill passed as written because its language was music to his ears. After all, JPMorgan’s partner in crime, Citigroup Inc. (NYSE: C), had written some mutually self-serving, screw-the-public language into the spending bill.
In the most important bill, coming at the most important time, before a recess, Citigroup and its lobbyists wrote a little provision into the bill that reversed new rules that the Dodd-Frank financial reform legislation passed in 2010 called for.
It’s not important anyway. It was just a stupid rule that should have been reversed.
I mean, how idiotic is it that Congress passed a law to make giant banks trade their IEDs (improvised explosive derivatives) in separate entities that were not guaranteed by the FDIC (an acronym that means “taxpayers”)?
Oh, the humanity! Imagine poor buttermilk banks not being able to skim off profits on leveraged derivatives trades on their own. That’s crazy.
If they had to do it on their own, they’d have to raise tons of capital. And that, of course, would impact their profitability.
So, I’m all for holiday gifts to the likes of JPMorgan and Citi. Thanks to the spending bill being passed as written, they can continue using depositor funds to leverage themselves up and swing for the fences.
Happy holidays!
And who thought a few phone calls to Congress would fall on deaf ears?
Maybe next time we all should call ourselves.
Money Morning/The Money Map Report
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