For those who opposed the massive bailout, a report in the New York Times may be little surprise. A reporter was able to get into a telephone conference call with JPMorgan Chase to hear executives discuss the $25 billion it received from Congress. Just four days after the bailout, JPMorgan Chase’s chief executive, Jamie Dimon held the conference call during which an executive admitted that Chase has no intention to use the money to make new loans but instead will use it to try to take over other companies.
The critical moment on the Oct. 17th call came when someone asked “Chase recently received $25 billion in federal funding. What effect will that have on the business side and will it change our strategic lending policy?”
Here is the response:
“Twenty-five billion dollars is obviously going to help the folks who are struggling more than Chase. What we do think it will help us do is perhaps be a little bit more active on the acquisition side or opportunistic side for some banks who are still struggling. And I would not assume that we are done on the acquisition side just because of the Washington Mutual and Bear Stearns mergers. I think there are going to be some great opportunities for us to grow in this environment, and I think we have an opportunity to use that $25 billion in that way and obviously depending on whether recession turns into depression or what happens in the future, you know, we have that as a backstop.”
I feel much better.
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