When Dimon arrived at J. P. Morgan, Bill Winters, the co-head of the investment bank, had heard that Dimon viewed derivatives trading as excessively risky. Winters confronted him, and Dimon responded that he didn’t understand derivatives well enough to have an opinion. Winters took him to school. “It got quite detailed — long-dated currency options and so on,” Winters recalled. “He was the only C.E.O. I ever worked for who did that.”

DURING THE MORTGAGE DEBACLE, Dimon’s reputation for averting risk suffered a hit. Oddly, the executive who worried about 100-year storms failed to challenge the industry models on home defaults. Many banks, including Chase, issued “stated-income loans” on which applicants were not required to document their income. Some mortgage brokers clearly encouraged borrowers to lie. Dimon says he thought Chase had enough information, electronically, to police such loans. “We didn’t anticipate the lying,” Dimon says, harping on a familiar theme — that bankers were not the only ones at fault. The blame for lying may have been his customers’, but the responsibility is Dimon’s. As Warren Buffett once observed: every bank is offered bad loans; it is the banker’s job to reject them. At Bank One, Dimon had ceased buying mortgages from outside brokers because their performance was poor. At Chase, he bought them. When I asked why, Dimon said underlings convinced him they were exercising proper caution, adding, “It was a huge business, packaging and selling [the loans] to Fannie Mae.” Turning silent, Dimon rotated his palms face up — as if nothing could excuse his error. “I bought that crap,” he concluded.

Dimon’s mantra is “Do the right thing.” That might sound like a corporate bromide, but it informs his view of how to run the company, from dealing with problems directly to trying to make gay employees at his firm feel comfortable. Dimon seems incapable of stifling unpleasant news; this translates, at a corporate level, to a rare emphasis on transparency. In a company aiming for interbusiness synergies, openness has strategic value. Unlike in the pre-Dimon days, heads of the various units share their numbers. Openness also works as a sort of spiritual glue. Mike Cavanagh, who worked for Dimon in the early ’90s, jumped ship from Citigroup to join him at Bank One and today runs a J. P. Morgan business that caters to institutional clients, says Dimon “can’t help but tell the truth.” Though executives would like to see Dimon develop a little humility, colleagues speak of him with uncommon loyalty.

AT 54, DIMON REMAINS TRIM, and though his hair is salt and peppery, there is something boyish — a puckish, faintly suppressed grin — in his manner. He speaks hurriedly, almost garbling the words, clutching a coffee cup while jabbing the air with his free hand. Colleagues marvel at his accessibility and his seemingly perfect recall. “You go in his office, there is almost nothing on his desk,” says Steve Black, a longtime colleague. “He reads it and remembers.”