On January 22, 2012, French presidential candidate François Hollande shook up the banks: “It has no name, no face, no party, it will never be candidate, it will therefore never be elected, yet it governs: that enemy is the world of finance,” he said. It “freed itself from all rules” and “took control of the economy, of society, and even our lives.” He’d fight it, he said, and promised some tough reforms.
But as the private sector in France sank deeper into an economic and fiscal quagmire, his words, designed to endear him to the left wing of his Socialist Party, were swept under the rug. And you’d think that since becoming President of France, he has been tutored by JPMorgan Chase CEO Jamie Dimon.
A year later, Dimon had some choice words himself, while at the World Economic Forum in Davos, Switzerland, where bankers, business leaders, politicians, and whoever was able to get in were hobnobbing for the better of the world.
Dimon lashed out at regulators and their feeble, slow, and confused efforts to rein in the banking industry so that it wouldn’t shove the world into another crisis. They were “trying to do too much, too fast,” he said. He defended inscrutable megabanks with their meaningless financial statements. “Businesses can be opaque,” he said. “They’re complex.” A word that in a financial crisis excuses everything, even massive bailouts that will haunt generations to come. “You don’t know how aircraft engines work, either,” he mollified us, based on the logic that we still get on a plane and fly across the Pacific.
And so the CEO of America’s largest TBTF bank, recipient of the Fed’s bailout trillions, praised the Fed because “they saved the system.” Indeed, they not only saved the system that had shoved the world into the financial crisis, but they also bailed out and enriched those who were, and still are, integral part of it—who now, according to Dallas Fed President Richard Fisher, “believe themselves to be exempt from the processes of bankruptcy and creative destruction” [for more on Fisher’s feisty fight against TBTF, read.... How Big Is ”BIG?”].