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Home › Money

Mary Wells | 03/21/2008 12:26 pm

Merger Menagerie Today, Melting Pot Next Year

By Mary Wells RSS
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Mary Wells

There is a very real and, to me, touching photograph in today’s New York Times of James Dimon crossing Park Avenue in the rain, from JP Morgan Chase’s offices on one side to Bear Stearns’ offices on the other side. I have been a client of both of these banks at one time or another and I can tell you that Bear Stearns’ offices are nicer than James Dimon’s.

JP Morgan Chase has been, over time, JP Morgan and Chase Manhattan and also The Chemical Bank of New York. When each of those mergers happened there was confusion and pain and turbulent disruption. Executives in, executives out. Each time there was an inner split because no two banks ever have the exact same strengths in abilities, experience, clients and employees. It is a menagerie in the beginning. Very, very tiring. And very, very sad for many employees who have put their trust and faith in the bank they worked for, but discovered they were no longer needed.

Today, there is probably no trace of those early banks at JP Morgan Chase. All their aspects went into the universe’s microwave and became a melting pot that now operates smoothly, almost magically, as one strong bank — as if it had one history. If you stopped a JP Morgan Chase employee in the hall and asked him about The Chemical he would probably say, “Huh?”

But right now James Dimon looks like Mephistopheles to the employees at Bear Stearns. There are many employees there who have worked for Bear Stearns for over 20 years and have lost almost all of their savings that had been carefully kept in Bear Stearns stock, so trusted for so long. After all those years — gone. Money for colleges. For retirement homes. For the care of older parents with serious health issues.

Mergers of all types of companies usually bring a lot of heartbreak in the beginning. This is “Heartbreak Time” at Bear Stearns, no matter how skillfully James Dimon and his executives try to pull things together — as they will. It doesn’t help at all that in a few years the magic microwave of life will have melted the two companies together and that — as a victim of who-knows-what, who-knows-who — Bear Stearns will have been saved.

What matters today are the hearts breaking.

Read more about: Bear Stearns, Business, Economy, JP Morgan Chase

13 Reader Comments (so far…) Sign In or Register to comment

Susan S
Gosh….when my husband and I are retired and paying almost $3.50 for a gallon of gas, $4.00 for a loaf of bread and are watching a meager IRA account dwindle by the day it is still have for me to feel sorry for most of the people at either of these companies.
By Susan S on 03/21/2008 1:33 pm
Mary Wells
Susan, I think the shock of trusting and then overnight discovering everything is lost. This didn’t creep up - the people at BearStearns had felt safe for years - even superior. That was a successful firm. Most of the people in it worked hard and did what they were expected to do. So they are really numb or furious. The furious ones seem to be having some success. We’ll see what they do about the new higher offer. But surprise shock can make you a little crazy.
By Mary Wells on 03/24/2008 4:53 pm
Tammy Moore
When a company finds themselves failing they look for the lifesaver. When one can’t be found every one loses their jobs. I feel sad for anyone who’s job is lost because of a merger, but if they can work for JP Morgan and Chase, they can find something else better. It’s their familys who suffer more because its the family who depends on the employee.
By Tammy Moore on 03/21/2008 2:50 pm
Mary Wells
I totally agree with your point about the families. Absolutely. Mary
By Mary Wells on 03/24/2008 12:42 pm
LCSUSAN LCSUSAN
Years ago when my home was about to be foreclosed on, I called customer service at Bank One and was greeted by a mainly screamed response telling me that I must have committed fraud otherwise I would never have received my loan. Scared yet angry, I wrote to the CEO of Bank One who just happened to be Jamie Dimon. A week or so later I received a reply telling me who to speak with in customer service, it was signed by Mr. Dimon. I realize that the missive was probably mostly a form letter written by JD’s most likely female assistant but it was a small bright point in one of my increasingly bleak visits to the mailbox. Given the hardball he played with Bear, Jamie Dimon is - I’m sure - a balls to the wall kind of guy but I will always have a soft spot in my heart for him. http://strictlyanecdotal.com/2008/02/11/there-should-be-blood.aspx
By LCSUSAN LCSUSAN on 03/21/2008 3:12 pm
Tammy Moore
LCSUSAN Thanks for the site. Very interesting to read. I recommend everyone take a look at that one.
By Tammy Moore on 03/21/2008 4:14 pm
Mary Wells
Well this move he is making with Bear Stearns isn’t fun and games for him although there are advantages for JP Morgan Chase in it but not enough that it isn’t a bit of a dare and a lot of hard work and a lot of government involvement which is never fun. I know people who work closely with him who believe he is strong but very decent. He didn’t have to send that letter to you. I think you are right to feel softly towards him. Mary
By Mary Wells on 03/24/2008 4:57 pm
Pamela Munro
Sadly I was witness to the takeover by Crocker Bank of my father’s finance company (UM&M) which had been successful for years. They then proceeded to dismantle all the ways in which the company had been successful and in several years it was GONE and not too long after it, Crocker Bank, too. The MBAs sought paper profits on balance sheets that looked good for the moment but would eventually turn into losses. My father knew - but he was overruled. That’s the diabolic nature of what has become today’s prevalent number crunching - not to mention that the MBAs never have learned “the business” via hardwon experience…So you get short-term profits for the financial pirates (who are also being paid quite handsomely) and long-term instability…
By Pamela Munro on 03/21/2008 4:31 pm
Holland Taylor
Pamela Munroe, YOU HAVE SAID IT ALL.
By Holland Taylor on 03/21/2008 6:02 pm
Mary Wells
Back tomorrow Pamela. Have to go to work. These crazy wonderful wowwomen work morning noon and night and it feels like Wells Rich Greene all over again. Back in the morning. Mary
By Mary Wells on 03/24/2008 5:00 pm
f.a. hunter
It’s not Dimon and JP Morgan that are the bad guys here…opportunistic, yes…but the failure of Bear Stearns must be laid at the feet of the BS executives who have enriched themselves at the expense of the public…Now the Fed, i.e. TAXPAYERS, will foot the bill…
By f.a. hunter on 03/24/2008 9:01 am
Jaime Herrera
Mary wells, congratulations on your new site. It seems that many greedy and unrealistic buyers came first, then many greedy lenders, then a few greedy investment bankers. Unfortunately, this pyramid was not built to last 3,000 years.
By Jaime Herrera on 03/24/2008 2:10 pm
CAROLINE MuLVEY
I know another bank that ended up in that microwave. The Philadelphia Bank, it is now (after a few other banks trying) Wa-mu Bank. It was crazy I left after the first change. My Mom stayed and for her reward she was let go .(with severance pay) .
By CAROLINE MuLVEY on 03/27/2008 10:26 am