Has Jamie Dimon Been Working Too Hard?

Jamie Dimon, CEO of JP Morgan, is battling under the weight of Bear Stearns' nasty balance sheet and the credit crunch that won't stop inflicting pain. This week he is adding to his to do list a crusade against any short seller who made money from the Bear Stearns decline. Presumably only JPM itself was supposed to profit from Bear's misery.

Dimon talked to Charlie Rose Monday night, and offered the following:

"This is even worse than insider trading. This is deliberate and malicious destruction of value and people's lives," Dimon said. "They shouldn't go to jail for a short period of time. If I was the SEC, I'd find out who made the money and I'd investigate like they do when they come after us all the time, e-mails, phone records, you name it, and I'd find out."

That is nonsense. I applaud anyone who correctly identified the fact that Bear's balance sheet was in jeopardy and made money on the short side.

If you were an institution with counterparty exposure to Bear, and you got short the stock or helped others do so, then either pulled your counterparty agreement or threatened to do so, or spread a rumor that you were going to do so, you have a problem. If you did good research and shorted Bear, good for you.