From Bloomberg contributing editor William D. Cohan:
First, we learned that Jamie Dimon, the onetime king of Wall Street, was wrong to describe it as a 'tempest in a teapot'. Then we learned that inside the bank there was (still is ?) a culture of paranoia and secrecy that encouraged traders to hide their mushrooming losses.
The list goes on. We learned that it’s possible to make a $237m mistake in a spreadsheet. We learned that the bank’s managers failed to disclose, in a timely manner, material information about the extent of the growing losses to the board’s audit committee - a panel that included Ellen Futter, my sister-in-law, who has since left the board. We learned that the Securities and Exchange Commission is showing a bit more backbone than usual by insisting - shocking! - on JPMorgan actually admitting to wrongdoing.
But mostly we have learned that the whole system of allowing traders to mark the value of complex transactions on their books is deeply flawed. It was also a recipe for the disaster that became the London Whale.
William D. Cohan is the author of the recently released Money and Power: How Goldman Sachs Came to Rule the World and the New York Times bestsellers House of Cards and The Last Tycoons.
Cohan is a contributing editor at Vanity Fair and writes frequently for Financial Times, Fortune, The Atlantic and The Washington Post. He worked on Wall Street as a senior mergers and acquisitions banker for 15 years. He also worked for two years at G.E. Capital. Cohan is a graduate of Duke University, Columbia University School of Journalism and Columbia University Graduate School of Business. The Last Tycoons won the 2007 Financial Times/Goldman Sachs Business Book of the Year Award.
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