Why Congress Won’t Touch Jamie Dimon: JPM Derivatives Prop Up US Debt

[sad sally]

2. Both Senator Bernie Sanders and Elizabeth Warren seem to think Dimon should depart.

Elizabeth Warren, a Democratic candidate for the Senate in Massachusetts, said Mr. Dimon should resign from the board of the New York Fed. The recent spectacular trading losses at his company require a full investigation, which should include an examination of how the supervision process broke down. How can this be anything other than awkward for the New York Fed while Mr. Dimon – hardly known as a shrinking violet – sits on its board?

Senator Bernie Sanders, a Vermont Independent, would go further, proposing legislation that would remove any bankers from the boards of Federal Reserve banks. For more background, you may want to consult Page 65 and other parts of a report from the Government Accountability Office, which deal with potential conflicts of interest in the Federal Reserve System, or at least read Senator Sanders’s summary of the report.

Dimon has also been an outspoken opponent of financial reform of late – including the Volcker Rule (on proprietary trading) and attempts to strengthen capital requirements. He is an intensely political figure, despite the fact that an important footnote in the Board of Governors’ policy on political activity by Reserve Bank directors says:

In all instances, directors should avoid any political activity that would publicly identify the director as being associated with the Federal Reserve System or would embarrass the System or raise questions about the independence of the director or the ability to perform Federal Reserve duties.

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Since Senator Sanders concerns deal with what's right for people not banks, I'm sure you'll get your wish and Mr. Dimon will remain the fox in the hen house.