Advice to Shareholders
As I have mentioned before, I like to read CEO Letters to Shareholders. And this has to be quite the year for reading what CEOs have to say about the past year. I just read Jamie Dimon’s Letter to JPMorgan Chase shareholders. It is well worth reading if you want to understand what went actually wrong in 2008. An excellent review of the causes of the financial meltdown.
A few excerpts that I underlined. The last quote is my favorite because he is so right:
About buying Bear Stearns: “We were not buying a house – we were buying a house on fire.”
On accepting TARP funds: “That said, we believe that accepting the TARP funds was the right thing to do for the U.S. financial system — and that JPMorgan Chase should not be parochial or selfish and stand in the way of actions that the government wanted to take to help the whole financial systems.”
On Making Bold Decisions in Tough Times (President Theodore Roosevelt): “It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
On Understanding Underlying Causes that Contributed to the Financial Crisis: “It was also surprising to realize that many of the main causes, in fact, were known and discussed abundantly before the crisis. However, no one predicted that all of these issues would come together in the way that they did and create the largest financial and economic crisis of our lifetime.”
On Not Wasting a Crisis: “Someone has famously said that a crisis should not go to waste. But what is also true is that it shouldn’t take a crisis to solve our problems.”