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JOHNSON: Jamie "Dimon... wants JPMorgan to become more global, especially by expanding more into emerging markets. U.S. Treasury Secretary Timothy Geithner endorsed this approach in an interview he gave to the New Republic, effectively arguing that we should want big, highly leveraged U.S. banks to make large bets on highly volatile emerging markets.
With Geithner firmly entrenched at the Treasury Department and with Bill Daley, former senior lobbyist at JPMorgan, now Barack Obama’s chief of staff, Dimon has all the political cover he needs.
AND: So when a big bank next gets into trouble, the choice will be between allowing a meltdown, with presumably awful financial consequences, and providing a bailout, which can have big fiscal impact.
Cautionary Tale
Recent experiences in Ireland should warn us all against the we’ll-do-a-bailout-when-needed approach advocated by Geithner."
