Audit Notes: Potshots at Snowden, News Corp. snake pit, Jamie Dimon

A Bloomberg BusinessWeek editor doesn't like the guy's attitude

Bloomberg Businessweek deputy editor Romesh Ratnasar takes to the pages of the magazine to criticize the “unbearable narcissism of Edward Snowden.”

In his letter to Ströeble, however, Snowden strikes the pose of a man being framed for crimes he didn’t commit at all. He refers to his leaks as a “public service” and “act of political expression” and contends that “my government continues to treat dissent as defection, and seeks to criminalize political speech with felony charges that provide no defense.” It was, of course, Snowden who opted to defect rather than return to the U.S. to face the government’s charges against him. And Snowden’s suggestion that the U.S. legal system affords him no means to defend himself in a court of law—even as he lives under the protection of the Russian government, which routinely jails critics without trial—is an insult to the intelligence of the citizenry he claims to be serving.

“I am confident that with the support of the international community, the government of the United States will abandon this harmful behavior,” Snowden’s letter concludes, in a typically cynical appeal for help from governments far more repressive than his own. Perhaps most cloying is Snowden’s description of his plight as a “humanitarian” cause, a label usually reserved for those suffering from poverty, war, or disease. Snowden may deserve praise and publicity he’s received for blowing the whistle on intelligence-gathering practices that violate the privacy of unsuspecting citizens. But he doesn’t need our pity as well.

This is bizarre. Of course Snowden’s leaks were a public service and an act of political expression. Why write something silly like this rather than, I dunno, something about the massive scandals and systemic lawbreaking Snowden has revealed.

It’s a classic example of how the press focuses on the trivial at the expense of the substantive.

Get a Tumblr, dude.

— The popcorn has been passed and the Murdoch hacking scandal trials have begun.

What a snake pit, that company.

The Guardian, hero of the story, reports that prosecutors say former News International CEO Rebekah Brooks wrote to James Murdoch days after the Milly Dowler scandal broke, pitching an internal investigation that would blame others in the company and “vindicate” her.

In an email to Rupert Murdoch’s son sent at 7.16am on 8 July, she suggested they should also declare that the company’s previous internal investigation was “woeful and limited”.

The email, shown to the Old Bailey jury, carried on: “A thought … and a Les situation could play well into this even if it was at a later date. Ie result of report when published would slam Les, Colin [Myler, News of the World editor] etc and it will vindicate my position (or not).”

That’s Les Hinton, then-CEO of Dow Jones. The evidence shows News Corporation was already discussing replacing the closed News of the World with a Sunday Sun, which it later did.

— Read Yves Smith on the case against one-time press favorite Jamie Dimon and JPMorgan Chase. She writes, correctly, that “bank CEOs have a powerful and largely compliant messaging apparatus in the financial media.”

Dimon’s frequent repetition of his claim that JP Morgan has a “fortress balance sheet” is a pure and simple Big Lie. The best he might be able to argue is that he’s won what the Japanese call a height competition among peanuts, that he’s better than his peers, but they are all at such a low level that these distinctions aren’t as meaningful as he’d like the great unwashed public to believe. But as the discussion above indicates, Dimon’s PR leaves out the tri-party repo risks, which none of his main competitors have. As banking industry expert Chris Whalen noted, “JP Morgan is running a $2.4 trillion bank attached to a $75 trillion derivatives clearing operation.” And the bank can get away with that precisely because regulators haven’t demanded that JP Morgan hold additional capital in order to cover the risk it runs in its clearing operations…
It’s simply routine for JP Morgan to completely ignore regulations. Here’s another example. Remember the brouhaha about how Goldman was manipulating the aluminum market via its ability to control inventory levels by virtue of owning a large number of warehouses used for clearing and storage? Financial holding companies aren’t supposed to be involved in the physical aspects of commodities dealing, but Goldman had its broader freedoms from its days as an investment bank grandfathered for five years, and had the nerve to thumb its nose at the Fed by buying the warehouses during that period. But that was better than JP Morgan’s conduct. The Fed has never permitted financial holding companies to own commodity infrastructure. But JP Morgan went ahead and bought warehouses from Henry Bath warehouses, without permission. I’m told that Fed officials have said off the record that nobody at the Fed has been able to explain under what authority JPM owns warehouses.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum. Tags: , , , ,