Free Web NovelManhattan, New York.
The conference room inside JPMorgan Chase Tower was already packed with reporters.
The moment Jamie Dimon opened the door and entered, camera flashes exploded all at once.
Maintaining a composed expression, he stepped to the podium.
Behind him hung a massive JPMorgan Chase logo.
“Thank you all for coming today.”
Jamie Dimon greeted the room in a calm voice, a faint smile on his lips.
After scanning the reporters, he glanced briefly at the notes he had prepared.
Then he raised his head again and began speaking.
“I invited everyone here today to correct several misconceptions regarding the recent articles published by The Wall Street Journal.”
He paused briefly before continuing.
“It is true that the Federal Reserve proposed that JPMorgan Chase acquire Bear Stearns in order to prevent its collapse.”
Reporters immediately began murmuring among themselves.
“But this was not preferential treatment. It was an offer made because JPMorgan Chase would be making a sacrifice for the stability of the American financial system.”
Tension filled the room.
“The Federal Reserve’s proposal included a thirty-billion-dollar debt guarantee and low-interest financing. Those conditions were based on JPMorgan Chase assuming responsibility for Bear Stearns’ severe financial problems. These terms were not favors. They were compensation for the enormous risks we would be taking in order to stabilize the financial markets.”
Chairman Dimon continued rebutting various allegations.
When his prepared remarks ended, reporters began raising their hands.
He pointed to one of them.
“Jamie, why JPMorgan Chase specifically? Out of all the financial institutions on Wall Street, why was only one firm approached? Isn’t that preferential treatment?”
“That’s because JPMorgan Chase remains financially healthy. Conservative risk management has always been one of our core principles.”
He spent considerable time explaining why JPMorgan Chase had been chosen.
After listening, more reporters raised their hands.
Dimon selected another.
“Jamie, then are you planning to acquire Bear Stearns?”
“We haven’t made a decision yet. The purpose of today’s press conference is to respond to the allegations raised by The Wall Street Journal. Whether we acquire Bear Stearns or decline remains under internal review. We’ll discuss the matter thoroughly with management and shareholders before making a final decision.”
Various questions and answers followed.
As the conference was nearing its conclusion, another reporter raised his hand.
Jamie Dimon frowned slightly before pointing at him.
“A Wall Street Journal reporter. You’ll be the final question.”
“Thank you for the opportunity. David Weinbart from The Wall Street Journal.”
There was a reason Dimon’s expression immediately darkened.
David Weinbart was the journalist responsible for the articles concerning Bear Stearns, the Federal Reserve, and JPMorgan Chase.
He was one of The Wall Street Journal’s most prominent financial reporters and columnists.
“I appreciate the explanations. Not every question has been answered, but I understand your position and JPMorgan Chase’s position. However, there’s one thing that strikes me as odd.”
“Glad to hear you understand.”
Jamie replied sarcastically.
He made no effort to hide his hostility.
“Have you ever heard of Penny Block Capital, Scone Gate Advisory, and Oakwood Partners?”
With every company name David mentioned, Jamie Dimon’s complexion grew paler.
Unable to hide his surprise, he stared at the reporter.
David continued.
“According to my investigation, these financial institutions are facing significant financial problems. Oakwood Partners, in particular, is reportedly on the verge of bankruptcy.”
The other reporters had no idea why David was asking about these companies.
But when they noticed Jamie Dimon’s changing expression, they immediately sensed that something was being hidden.
Everyone waited for his answer.
The energy in the room, which had begun cooling down, instantly reignited.
“Today we’re only discussing matters directly related to JPMorgan Chase.”
“That’s exactly why I’m asking. Are you familiar with these companies?”
“......”
“You’re not going to claim you’ve never heard of them, are you? They’re all shadow-banking entities JPMorgan Chase created to evade regulation.”
Shadow banking?
The unfamiliar term immediately drew every reporter’s attention.
“Isn’t it a bit questionable to claim JPMorgan Chase is financially sound while using such a system? Please explain.”
Jamie Dimon completely failed to control his expression.
He had never imagined this topic would emerge here.
Not even once.
“I won’t answer that.”
He chose to avoid the question.
It was the worst possible choice.
The other reporters immediately pounced.
Now they didn’t even wait to be called on.
Questions flew from every direction.
In the end, Jamie Dimon had to leave the conference room under security escort.
JPMorgan Chase had held the press conference to clear up suspicions.
Instead, it became entangled in even larger ones.
* * *
[JPMorgan Chase Accused of Evading Financial Regulations Through Shadow Banking]
The Journal has received explosive information from an anonymous source alleging that JPMorgan Chase has been evading financial regulations through shadow-banking operations.
According to the information received, JPMorgan Chase conducted aggressive investments through outside entities such as Penny Block Capital, Scone Gate Advisory, and Oakwood Partners.
Oakwood Partners, in particular, is reportedly facing bankruptcy, making the implications even more serious.
The anonymous source claims that JPMorgan Chase participated in high-risk mortgage lending and derivatives trading through outside companies not subject to direct regulation.
While these firms are not officially affiliated with JPMorgan Chase, they are reportedly closely connected in practice.
Scone Gate Advisory, in particular, specialized in investment advisory services and capital raising, supporting JPMorgan Chase’s aggressive investment strategies.
Through these shadow-banking activities, JPMorgan Chase allegedly bypassed financial regulations while pursuing higher returns.
American financial regulators impose numerous restrictions intended to control banking risk.
However, JPMorgan Chase is accused of circumventing those restrictions through shadow-banking structures.
Experts warn that such activities could pose significant threats to financial-market stability.
Mortgage lending and derivatives trading involve substantial risk and could result in enormous losses if market conditions deteriorate or judgments prove incorrect.
Oakwood Partners’ recent financial distress is cited as evidence of the dangers inherent in these investment strategies.
The situation demonstrates just how aggressive and risky JPMorgan Chase’s investment approach may have become.
* * *
I greeted the morning from the top-floor penthouse overlooking Wall Street.
Approaching the window, I sipped coffee while watching tiny figures move busily below.
“New York is always alive.”
Turning around, I sat on the sofa.
Several newspapers lay neatly arranged on the table.
The first one I picked up was The Wall Street Journal.
The front page featured David’s article about JPMorgan Chase’s shadow-banking operations.
“JPMorgan Chase. Your true face is finally showing.”
I slowly began reading.
In addition to the information I had supplied, David had uncovered several additional details through his own investigation.
“Hm... on the verge of bankruptcy?”
I immediately called Manager Ma.
“Manager. There’s an article claiming Oakwood Partners is nearing bankruptcy. Is that true?”
“I haven’t received any reports on that yet.”
“The article says losses from high-risk mortgage loans and derivatives trading are severe. Tell them to investigate in detail.”
“Yes, sir. I’ll pass it along.”
I nodded and continued reading.
After finishing the lengthy article, I set the newspaper down.
“I wonder how the Federal Reserve will respond. Did they know and pretend not to? Or did they genuinely have no idea?”
Either possibility was fine with me.
If they knew, they were accomplices.
If they didn’t, they were incompetent.
“Well, the board has been set. Let’s see who contacts me first.”
I lifted my coffee cup and smiled.
The first call came from Chairman Jamie Dimon.
I invited him to my penthouse.
Greeting him warmly, I said,
“Welcome.”
“It’s a pleasure. This is our first time meeting face-to-face. Ah, and congratulations on becoming the head of the Korean branch.”
“Thank you.”
After the formalities, we sat across from one another.
He looked noticeably worn.
His eyes were bloodshot from fatigue, and tension covered his face.
Removing his hat and setting it beside him, he asked,
“You’re behind The Wall Street Journal, aren’t you, Charlie?”
Getting straight to the point.
I smiled.
“The Wall Street Journal isn’t some tabloid. Saying I’m ‘behind it’ sounds a bit misleading.”
“Then let me rephrase. You’re the anonymous source, aren’t you?”
I didn’t deny it.
“That’s right. I provided the information.”
“Why? We’ve never had a bad relationship with Dreamhigh.”
He was right.
Our relationship had been neither good nor bad.
JPMorgan Chase had never been connected to Baltiche.
I shrugged casually.
“Because JPMorgan Chase acquiring Bear Stearns wasn’t part of my plan. If these allegations had never surfaced, would you really have walked away from the deal?”
“We haven’t even decided whether to acquire it yet!”
“I doubt that. If I know anything about you, Chairman, you’d absolutely go through with it. You keep saying the acquisition carries enormous risk, but you’d essentially be buying Bear Stearns with someone else’s money.”
Jamie Dimon opened his mouth but failed to respond.
“That’s why I had no choice but to use more aggressive methods.”
He let out a deep sigh.
“Let’s stop this. We won’t acquire Bear Stearns.”
“Isn’t it already too late for that?”
“Please, Charlie. At this rate, JPMorgan Chase could start wobbling too. Is that what you want? If we fall, the consequences will be far worse than anything involving Bear Stearns.”
Without hesitation, Jamie lowered his head.
“A lot of people at our company will suffer because of this. No—our investors will suffer even more. The people who trusted us. Let’s stop here.”
It was obvious he had been under attack from all directions.
He sounded desperate.
“Even if I stepped in, The Wall Street Journal wouldn’t stop publishing. That was decided from the beginning.”
“That’s fine. We can still manage that much. But if things escalate further, it may become impossible to contain. Please stop attacking us, Charlie.”
Jamie pleaded once again.
He truly was desperate.
I quietly studied him before speaking.
“I have no personal grudge against you, Chairman. And I’m not attacking JPMorgan Chase.”
“Then why?”
“Because what I want is Bear Stearns’ bankruptcy.”
“What?”
“Dreamhigh wanted to acquire Bear Stearns, didn’t it? So you were trying to push us out—”
“No. Not at all.”
Acquiring Bear Stearns wouldn’t have been difficult.
But that wasn’t Bear Stearns’ role in my plan.
“I want Bear Stearns to go bankrupt.”
“Why...?”
Jamie stammered.
Then his face suddenly froze.
It seemed he had finally realized what I wanted.
I nodded and smiled gently.
“That’s right.”
“I want Wall Street to suffer one major collapse.”
Chairman Jamie Dimon stared at me in horror.
