Sept 13 2008

Sept 13th 2008 “Standing at the kitchen of his Park Ave mid town New York Apartment, Jamie Dimon poured himself a cup of coffee, hoping it might ease his headache… It was just past 7:00 Am on the morning of Saturday September 13, 2008 . Dimon was the chairman of JP Morgan Chase, the nations third largest bank, had spent the prior evening at an emergency all-hands-on-the-deck meeting at the Federal Reserve Bank of New York with a dozen of his rival Wall Street CEOs. Their assignment was to come up with a rescue plan to save Lehman Brothers, the nations fourth largest investment bank- or risk collateral damage that might ensure in the markets…. As promised Saturday’s papers prominently featured the dramatic news to which he had alluded. Leaning against the kitchen counter, Dimon opened the Wall Street Journal and read the headline of it’s lead story: ‘Lehman Races Clock: Crises Spreads.” Dimon knew that Lehman might not make it through the weekend. JP Morgan had examined its books earlier in the week as a potential lender and had been unimpressed. In the next twenty four hours. Dimon knew. Lehman would either be rescued or ruined. Knowing what he did however Dimon was concerned about more than just Lehman Brothers. He was aware that Merrill Lynch, another icon of Wall Street, was in trouble too and he was also acutely aware of new dangers developing at the global insurance giant American International Group AIG that had so far gone relatively unnoticed by the public. By his estimation AIG had only about a week to find a solution, or it too could falter. Of the handful of principals involved with the dialogue about the enveloping crisis- the government included- Dimon was in an especially unusual position. He had the closest thing to perfect, real time information. That ‘deal flow’ enabled him to identify the fraying threads in the fabric of the financial system, even if the safety nets that others assumed would save the day. Dimon began contemplating a worst case scenario and at 7:30 AM he went to the library and dialed a conference call with two dozen members of his management team. “You are about to experience the most unbelievable week in America ever, and we have to be prepared for the absolute worst case, we have to protect the firm, This is about our survival” Dimon told them…. –many of those listening to the call assumed that the government would intervene and prevent failure. Dimon hastened to disabuse them of the notion. “That’s wishful thinking there is no way in my opinion that Washington is going to bail out an investment bank. Nor should they; I want you to know that this is a matter of life and death- I’m serious …. Here’s the drill we need to prepare right now for Lehman Brothers filing (for bankruptcy) And for Merrill Lynch failing; And for AIG filing: and for Morgan Stanley Filing: And for Morgan Stanley filing- And potentially for Goldman Sachs filing” there was a collective gasp on the phone. Page 1-3 Too Big to Fail Andrew Ross Sorkin –Viking Penguin Group New York 2009 We assume that the Capitalist System of Free Enterprise is like American Democracy and The Constitution -Made in heaven- At least Blessed by God- And join with me here saying sincerely: God Bless America. This afternoon I was preaching as I was putting up Xmas lights for my grandson- Sure late but we have to wait till the Boxing Day sales to get the lights! And beside he has no sense of any particular day being special- Well annoyed at what some US General had said about ‘Marxist Insurgency’ I was apologizing for Marx getting his name on a system of government invented by Joseph in Egypt! Thus more brilliant than Judah would ever be- his brother Joseph invented the ‘good’ ‘biblical’ system of government which later got the name of a highly intelligent Jew- Son of Torah Rabbi –young Karl Marx- And here in New Zealand with our Treaty in 1840 as well in the founding of Hong Kong at the same time there is a clear influence in English Colonial Government thinking coming direct from Marx on the idea of Government ownership of all the land and then the leasing of that land… A system is just that! A system. And bad systems which do not conform to the Torah- well they fall over. This is the story of that.