JPMorgan: Give Jamie Dimon a Break

NEW YORK ( TheStreet) -- Reports out over the past couple of days indicate JPMorgan Chase ( JPM) CEO Jamie Dimon looked like he wanted to vomit when told of his firm's now-infamous $2 billion trading loss. According to The Wall Street Journal Dimon "didn't sleep well for the next several nights ... and fought the anxiety by getting up very early to exercise and head into the office."

TheStreet contributor Susan Antilla did an excellent job discussing reports that JPM Chief Investment Officer Ina Drew, who is a woman, "tearfully offered to resign" and "cried -- a bunch of times" through the whole ordeal.

The entire debacle and the reaction to it, particularly these discussions of emotion, triggered me to think along a couple of different lines. First, like Antilla, I considered displays of emotion. And, second, I assessed misdirected emotion.

Don't blame Dimon or Drew for your mistakes

Investors have loads of outrage for Dimon, Drew, the "London Whale" and big banks once again. And, really, it's all kind of funny. Consider the following excerpt from a Bloomberg story on shareholder lawsuits filed against Dimon and JPMorgan: "The defendant Dimon went so far as to publicly and vigorously dispute that any investment safety regulation was necessary for financial institutions such as JPMorgan, because the company was purportedly so careful with its investments that no such regulations would be necessary," James Baker, a California resident, said in his complaint. "All of the individual defendants knew this was simply not the case."

Here's a classic case of blaming others for your own mistakes.

Think about something. People such as Baker, presumably, held shares of JPM at some point after the financial crisis subsided up until the time the stock cratered when Dimon went public -- and, for the record, he could have waited longer but chose not to -- with news of the loss. That, in and of itself, represents quite a gamble. Going long a bank stock! Not a position for the faint of heart or the prudent long-term investor. It's about as risky a "value" play as you'll find.

When they heard Dimon go "so far as to publicly and vigorously dispute that any investment safety regulation was necessary for ... JPMorgan," they apparently believed him. If not, it would have made sense for the careful and rational investor to sell at that point as a result of skepticism, cynicism or whatever for these apparent scoundrels. But they did not sell. Instead, they would have us come to the only conclusion a logical person could come to: They put their faith in Dimon and the folks they now refer to as "defendants."

Bottom line -- if you cannot manage your little retail portfolio, don't cast Dimon and Drew as devils and liars because they erred in the oversight of a multibillion-dollar one.

Dimon put Drew, who by all accounts is incredibly well-qualified and competent, in place. From there, she put people in place to run the various segments of the investment bank. That's what executives do. They hire people they think can do the job, who hire other people they think can do the job. For better or worse, when something happens on the top dog's watch, the top dog gets heaped with scorn.

I am not sure what I think of that trademark response of our culture, other than it's typical. To save our minds from considering questions without easy answers, we look for simplistic closure to complex queries. Dimon's a bum. Drew's an incompetent and emotional woman. And then we play armchair quarterback slinging mud, posting anonymous comments on message boards and filing lawsuits. Man, I love America!

People made mistakes at JPMorgan. That's really the extent of it. If the trade worked, we would not be hearing about the loser on the other side of it unless it was a party we habitually cast as villain. I delegate responsibility to you. I have about 600,000 other things to deal with. You screw up. I deal with it. That's the life of a CEO. They make big decisions as many times as the average slug logs onto Facebook during the typical day. And clean up somebody else's mess -- and often take the fall for it -- just as frequently.

Dimon was sick about what happened. He probably still is. Obviously, Drew was -- and is -- also. She cried. If I was an integral part of what took place, I would have cried as well. Both folks have taken the heat and owned up to the error of their ways. In fact, they probably take too much responsibility for the errant judgment of others.

It would be nice if the investors busy wasting the court's time showed the same amount of character.

At the time of publication, the author holds no positions in any of the stocks mentioned in this article.