Jamie Dimon Secretary of Treasury: Could He Replace Tim Geithner?
As the fiscal cliff nail-biter dragged on this past Sunday, and into today, soon the focus will shift from the short term punt to the long game and who will be the next coach for the United States Treasury. This is a critical decision as we look forward to a ballooning deficit, no budget, and uncertainty in the tax code.
In the first article of this series, the resume of current White House Chief of Staff, Jacob “Jack” Lew was highlighted. Another name that has been bounced around is James “Jamie” Dimon. How will his resume stack up to other potential nominees?
Jamie Dimon, reportedly a top pick of the Oracle of Omaha, Warren Buffet, was born in New York City, a third generation stock broker, and longtime Democrat. He earned his bachelor's at Tufts and masters from Harvard Business School as a Baker Scholar.
After graduating from Harvard, Dimon had numerous job offers with other financial firms. His father, then an executive vice president at American Express, handed an essay Dimon had written to then president, Sandy Weill. After reading the essay, Weill offered the young Dimon a position as an assistant to the president at American Express which Dimon accepted.
After Weill’s break-up with American Express in 1985, Dimon followed his mentor on a new venture — acquiring Commercial Credit Company from Control Data Corporation. Together, they turned the company around with Dimon serving as CFO and executive vice president, then president of the company.
They acquired Primerica then assumed the Primerica brand for Commercial Credit Company. By 1993, they had acquired The Travelers Corporation and renamed the company to The Travelers Group where Dimon remained president and COO. Through numerous mergers and acquisitions a new global financial services company was created — Citigroup. Citigroup has since divested the Travelers Group operations.
In 1998, Dimon was fired by his mentor, Sandy Weill.
In 2000, Dimon became CEO of Bank One. After JPMorgan Chase purchased Bank One in 2004, he served as president and COO of JPMorgan Chase. A year later, Dimon was named CEO of the merged company. By 2006, Dimon was chairman of the board for JPMorgan Chase.
In 2007, Dimon was appointed as a Class A Director of the Federal Reserve Bank of New York. He was also a decision maker in the $55 billion loan granted to JP Morgan Chase to bail out Bear Stearns. Chase paid off all TARP loans by the end of 2011. Dimon continues his appointment as a Class A Director.
During the TARP bailouts, and at the 2009 World Economic Forum in Davos, Dimon was vocal in his opposition to nationalization of banks, particularly U.S. banks. During the Davos meeting, Dimon stated, "JPMorgan would be fine if we stopped talking about (the) damn nationalization of banks...we've got plenty of capital."
In 2011, Dimon went toe-to-toe with Mark Carney, then governor of the Bank of Canada, over the Basel III standards set forth by the Basel Committee on Banking Supervision. Dimon was concerned that the regulations are discriminatory to the U.S. and “anti-American.” Unfortunately, this altercation may follow Dimon to England as Carney prepares to take his post as the top banker at the Bank of England.
Earlier this year, Dimon once again made headlines after JPMorgan Chase lost at least $2 billion in trades. During an episode of The View, host, Whoopi Goldberg questioned President Obama on the transaction. Obama replied, "First of all, JP Morgan is one of the best managed banks there is. Jamie Dimon, the head of it, is one of the smartest bankers we've got… it's going to be investigated." The transaction is currently under investigation by the Federal Reserve, the SEC, and the FBI.
Dimon’s philanthropic interests are varied. He serves The National Center on Addiction and Substance Abuse, Harvard Business School and Catalyst, and sits on the Board of Trustees of New York University School of Medicine. JPMorgan Chase is the only publicly traded board he sits on.
Even though Dimon has successfully lead JPMorgan Chase and reportedly has close ties to the White House, he has little legislative experience. It’s uncertain if he will be able to switch gears from being the head of a company to bridging the communication gap between two divided parties even though he has been openly vocal in raising concerns over some of the Obama policies.
Further, should Dimon get the nod, Obama’s greatest challenge will not come from the Republican party. Rather, from within their own party; primarily, Senator-Elect, Elizabeth Warren.