News Wrap: JPMorgan Was Honest With Shareholders, Jamie Dimon Says
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HARI SREENIVASAN: The housing market is showing new signs of life. The number of new single-family homes being built grew in May for the third straight month. And builders asked for the most construction permits since 2008.
On Wall Street today, stocks rallied on hopes that the Federal Reserve will try again to boost the overall economy. The Dow Jones industrial average gained 95 points to close at 12,837. The Nasdaq rose 34 points to close at 2,929.
The CEO of JPMorgan Chase faced more questions from Congress today involving the bank’s $2 billion trading loss. Jamie Dimon told a House committee that the company did its best to inform investors about its risk strategy in advance.
Democrat Barney Frank pressed Dimon on his statements that top bank officials will have to give back some of their pay.
REP. BARNEY FRANK, D-Mass.: You did say finally that there would be some clawbacks for compensation. You have also taken some responsibility here. Will the clawbacks for compensation — is your compensation on the table for consideration of clawbacks?
JAMIE DIMON, chairman, JP. Morgan Chase: Yes, all of these — this whole axis if being reviewed by the board.
REP. BARNEY FRANK: Yours specifically. Just a specific question.
JAMIE DIMON: My compensation is 100 percent up to my board.
REP. BARNEY FRANK: Is it — Mr. Dimon, you said that there are going to be clawbacks for people responsible. Is your compensation in the pot that’s going to be considered for that?
JAMIE DIMON: They will do what they see is appropriate. I can’t tell my board what to do.
HARI SREENIVASAN: The Securities and Exchange Commission is investigating the losses at J.P. Morgan Chase and the information it supplied to investors. SEC Chairwoman Mary Schapiro said today there could be grounds for legal sanctions against the bank.
The G20 summit in Mexico wound up today, with European leaders rejecting pressure for immediate action on their debt crisis. Instead, they say they will pursue longer-term measures, such as integrating banking systems.
Meanwhile, in Greece, the Socialist Party leader said political talks could lead to a new coalition government by tomorrow. It is expected to keep Greek commitments under an international bailout.
In Pakistan, the country’s Supreme Court dismissed the prime minister from office, touching off new political turmoil. The judges said Yousuf Raza Gilani has not legally been prime minister since he was convicted of contempt in April. That came after he refused to investigate President Asif Ali Zardari on corruption allegations. It was unclear when a new prime minister would be chosen.
Two days of nuclear negotiations between Iran and six world powers have ended in a deadlock in Moscow. The U.S. and other nations demanded Iran stop uranium enrichment. The Iranians, in turn, insisted that sanctions against their oil industry be lifted. The European Union foreign policy chief, Catherine Ashton, said diplomacy is still possible, despite the failure in Moscow.
CATHERINE ASHTON, European Union: The choice is Iran’s. We expect Iran to decide whether it is willing to make diplomacy work, to focus on reaching agreement on concrete confidence-building steps, and to address the concerns of the international community.
HARI SREENIVASAN: Ashton said high-level talks are being suspended. Instead, lower-ranking representatives from the two sides will meet in Istanbul, Turkey, next month.
The government of Syria said today it is ready to heed a U.N. call to evacuate civilians from Homs. It blamed rebels for obstructing the effort. Today, explosions and shelling continued to rock the region around Homs. As many as 1,000 families have been trapped by the ongoing assault on the city and surrounding towns.
At the U.N., the chief of the observer mission to Syria, Norwegian General Robert Mood, briefed the Security Council on the rising violence.
Firefighters hoped to make more progress today in containing a wildfire in Colorado that’s burned across 92 square miles. The fire, burning west of Fort Collins, is now 50 percent contained. But it has already destroyed at least 189 homes.
Today, firefighters had to contend again with hot, dry weather and the threat of high winds.
BILL HAHNENBERG, incident commander: The winds will be around 15 to 20 miles an hour with some gusts to 30, which are fairly severe. Those swirling winds can be problematic, causing gusty conditions in all these canyons that we’re working in. So we don’t expect to have that hard wind out of the west like we had Sunday. It will be more like yesterday’s conditions, where we were pretty successful.
HARI SREENIVASAN: Wildfires were also still burning across other Western states. From Wyoming to Arizona to Southern California, fires have forced the evacuation of hundreds of homes.
The nation’s largest Protestant denomination, the Southern Baptist Convention, elected its first African-American president today. The elevation of Reverend Fred Luter Jr. came 17 years after the church apologized for its past defense of segregation and slavery in 1995. It is also seen as a move to reflect growing diversity. Southern Baptist membership has fallen for five straight years. It currently stands at 16 million members in 42 states.
Asians now make up the largest share of recent U.S. immigrants, surpassing Hispanics. The Pew Research Center reported today that Asians of all ethnicities accounted for more than a third of new arrivals in 2010. They make up only 5.8 percent of the overall U.S. population. The report also found Asian immigrants are the most educated, have the highest incomes, and are happier with their lives than the general American public.
Those are some of the day’s major stories.