Oh the humanity of a $2 billion trading loss suffered by J.P. Morgan shareholders! President Obama and his press secretary Jay Carney were self-righteously indigant yesterday. Apparently because this bank wasted a lot of money on a bad investment. Ironically, the president is afraid the taxpayers “might” be on the hook if Morgan keeps doing stupid things with shareholder money. Fair enough. We will get back to that part of the discussion in a paragraph or two.
The J.P. Morgan story has so many twists and turns it is hard to know where to begin. Let’s start four years ago and talk about J.P. Morgan CEO Jamie Dimon. Like so many Wall Street bankers at places like J.P. Morgan and Goldman Sachs, Dimon was a staunch supporter of Barack Obama in 2008. In fact Dimon gave money to Obama’s campaign and bundled the contributions of others for Obama. Clearly Dimon has a history of making bad decisions. Ironically, Dimon's company, J.P. Morgan was one of the few large firms that did not
need bailout funds in 2008. Since backing the Obama candidacy in 2008, Dimon has seen the error in his ways and become a harsh critic of the heavy handed anti-business attitudes of the Obama adminsitration.
One investment arena that was not the target of Obama’s criticism yesterday, when the president was ripping on J.P. Morgan, was the dumb bets his administration has made on eight different solar companies. For the record, Solyndra is not the only company that received fast track approval by the federal government to receive taxpayer guarantees. The
U.S. Department of Interior also got involved in fast tracking the lease of federal lands in no-bid processes to: Abengoa Solar, BrightSource Energy, First Solar, Nevada Geothermal Power, NextEra Energy Resources, Ormat Nevada, and SolarReserve. Naturally there was no Keystone XL pipeline-like slowdown or turn down on any of these dubious investments by the Obama administration. Oh and yes, and these companies also received loan guarantees worth billions from the Department of Energy under its renewable energy loan program. They also received renewable energy grants from the Treasury Department.
Of course, Solyndra has already filed for bankruptcy. And it seems that First Solar, teetering on the edge of collapse, was caught selling solar panels to itself to circumvent rules related to its government grants and loans earlier this year.
It is time to get real. The idea that President Obama is suddenly upset because J.P. Morgan’s stockholders got the news that the bank made some bad decisions is laughable. The president needs to clear the hypocritical plank from his own investment eye and should stop throwing away billions of taxpayer dollars. The idea that he is instead contemplating the possibility of a bailout of J.P. Morgan tells us all we need to know about what a second term might look like.
Investments of J.P. Morgan and B.H. Obama
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