Last Name : Dimon
First Name: Jamie
Nickname : The Diamond
Age: 66 years old
Distinguishing feature: Always wears the same cufflinks
Position: CEO of JP Morgan since 2006 - the only current big bank boss to have experienced 2008
Statement: "I've been saying for some time that the weather is good right now but the clouds are gathering and a storm is coming. I'm going to change that prediction: it won't be a storm, but a hurricane. So we don't know yet if it's going to be a small one or a big one, but at JP Morgan we're going to prepare for it and we're going to be very conservative with our balance sheet."
What I think: One more warning to add to those recently uttered by the CEOs of Facebook, Target, Tesla, Uber, etc... If there was a U.S. CEO sentiment index, it wouldn't be flying high today.
To do: If you are in for some bad weather, it's a good idea to check your portfolios BEFORE the downpour. There are some risky bets that you should put aside for the time being. Remember that problems with liquidity, leverage, derivatives etc... always occur during crises - no coincidence that Maddoff blew up two months after Lehman Brothers.
That said: Dimon has already barked up the wrong tree. In 2012, when rumors of large losses for JP Morgan on credit derivatives came out, Dimon called it a "tempest in the teapot". In reality, the bank will lose $7 billion because of the trader Bruno Iksil who was nicknamed "London Whale". So obviously, "the whale in the teapot" is worthy of being nominated for an Academy Award in the category of blunder.
Have a good week,
Charles