David Brancaccio: JPMorgan Chase CEO Jamie Dimon says his bank will change how it manages some of its money. He spoke yesterday, as he continued to try to explain how the bank lost billions of dollars in bets on the market that went wrong. He said the bank will keep it's dividend payment to investors.
Allan Sloan, senior editor-at-large at Fortune Magazine joins me here in the New York bureau. Allan, turns out that, what, you yourself are a JPMorgan Chase investor?
Allan Sloan: Well by accident, having to do with being a bank reporter 40 years ago in Detroit, I owned 39 shares of JPMorgan, which is worth roughly $1300.
Brancaccio: $1300 -- a major investor in JPMorgan. So, you get the annual report; you're an ace financial journalist. If you read that report carefully maybe you could see this mess coming?
Sloan: Well, maybe you could -- except no human being could possibly read the annual report carefully. And do you know why?
Sloan: It's 316 pages long, of which 250 pages are financial statements in type so small I have trouble reading it. And I'm sure it meets every legal requirement for disclosure, but it's not helpful. It doesn't tell you anything -- even if I parsed ever blessed word in those 250 pages, there's no way I would have seen this coming.
Brancaccio: So one of the problems here, of course, is that the big, legislative regulatory response to the financial meltdown that followed Lehman Brothers was: let's bring more disclosure to the process; let's know what's going on at these financial institutions. And you're telling me that even if there is disclosure, it's hard to really understand what's going on.
Sloan: Well it's hard for me as a civilian to understand what's going on. The regulators, presumably, have more disclosure information than we do. But when you have a situation like Morgan -- where it was clear the bank itself had no idea what was going on, or it wouldn't have lost $3 billion. If the bank doesn't know, how are the regulators going to know? It's impossible.
Brancaccio: Allan Sloan, senior editor-at-large, Fortune Magazine. Thank you so much.
Sloan: You're welcome. My pleasure.