James Moore: Should Uncle Sam call on Jamie Dimon?

James Moore
Wednesday 28 November 2012 01:00
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Outlook Talking of Mr Carney, he must have shuddered just a little bit yesterday after no less than Warren Buffett suggested his old pal Jamie Dimon, the chief executive of JP Morgan, would be a great candidate for US Treasury Secretary.

The legendary Sage of Omaha believes Mr Dimon would be just the guy to sort out Uncle Sam's looming fiscal cliff. In the absence of a new deal over America's debt ceiling it calls for a nasty package of spending cuts and tax rises which could send not just the US but the rest of the world into a tailspin.

Mr Dimon, thinks Mr Buffett, could change all that by waltzing into Congress and knocking heads together to get a deal done. Like he did with his traders when they lost $6bn (and rising) in London?

Mr Buffett is a brilliant businessman who has made fortunes for investors at Berkshire Hathaway. He saw that half the technology companies at the turn of the century were wearing the emperor's new clothes, and rightly thinks its wrong that a billionaire like him pays less tax than his cleaners.

Strange, then, that he doesn't see the flaws in Mr Dimon.

The latter has bitterly opposed much-needed reforms to a banking industry that came within a heartbeat of breaking the world's financial system and was chronically undercapitalised. Then there were those losses, a symptom of what is culturally wrong with institutions that let loose young and arrogant traders with too little supervision – and are a very good argument for insisting banks hold more capital. Which is what Mr Carney demanded when the two men clashed.

Fortunately for Mr Carney, it is unlikely to happen. Mr Dimon has previously described himself as unsuited to politics. His ego and hubris are indeed enormous. But they're not that big. At least not yet.

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