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Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside

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Speaker 1: my co host Matt Miller. Every business day we bring

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Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along

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Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast

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Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and

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Speaker 1: at Bloomberg dot com slash podcast. Let's bring you our

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Speaker 1: interview with JP Morgan CEO Jamie Dimond. He sits down

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Speaker 1: with the Bloomberg's Ed Hammond. Let's go to that conversation

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Speaker 1: right now. We're here in Miami, Jamie. Great to be back,

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Speaker 1: Great to be with you, Great to be standing. What

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Speaker 1: are you worried about? Great? Great to be here, by

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Speaker 1: the way, so thank you. The thing I'm worried the

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Speaker 1: most about it, if you go, it's Ukraine's oil gas,

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Speaker 1: So the leadership of the world and you know our

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Speaker 1: related with China. I mean that is much more serious

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Speaker 1: thought the economic vibrations you all have to deal with

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Speaker 1: on a day to day basis. On the Ukraine question

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Speaker 1: that we talked about obviously a year ago, I'm very

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Speaker 1: shortly off to the wolf had started. Do you think

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Speaker 1: now a year in the West has become somewhat neured

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Speaker 1: to the idea of a conflict of this scale on

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Speaker 1: its borders, and if so, does that worry it? No, No,

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Speaker 1: it looks a little bit like people inured to it.

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Speaker 1: But I think that's a little bit of mistake. I

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Speaker 1: read a report the other day that when the war

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Speaker 1: goes to one year, it lasts normally last ten. But

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Speaker 1: this is a major land war in Europe and a

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Speaker 1: freedom democratic nation. You know, the hundreds of thousands of

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Speaker 1: casualties are ready on both sides, and so I think

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Speaker 1: we we don't know how this is going to end,

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Speaker 1: we know what direction is gonna taken, and it's affecting

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Speaker 1: global relationships, so Ukraine Russia, then this oil gas food

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Speaker 1: of how it's hurting in poorer countries, and it's royally

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Speaker 1: trade relationships between America, China and the rest of the world.

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Speaker 1: So this is a probably the most serious geopolitical thing

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Speaker 1: we've had to deal with since World War Two. Would

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Speaker 1: you full see a future way to take people could

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Speaker 1: potentially re enter the Russia MAKA as a business. I

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Speaker 1: mean a very premature to say, you know, I think

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Speaker 1: if there is a one day maybe, but it's very

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Speaker 1: possible that woman happened in our lifetime. And you mentioned

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Speaker 1: US China relations obviously not at their best right now.

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Speaker 1: Partake any posts the balloons. I wonder what role you

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Speaker 1: see business playing in trying to sort of moderate those

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Speaker 1: relations and try and keep them as good as possible. Well,

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Speaker 1: you know, it's really the government. The government has to

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Speaker 1: set the rules and fear what they want to do.

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Speaker 1: And I think it's a fair complaint about government and

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Speaker 1: business that we probably should have started resetting this ten

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Speaker 1: years ago and we didn't. I don't like a choir

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Speaker 1: was billed milk and all that. But going forward, the

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Speaker 1: government and I think they're doing a good job thinking

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Speaker 1: through what is national security? So I think its semiconductors

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Speaker 1: or penicillan, there are certain drugs, what is unfair trade?

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Speaker 1: And then you know, at one point, sit down, have

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Speaker 1: a very serious conversation with Chinese government. You know, remember

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Speaker 1: Secretary Blincoln was on his way over there to do that,

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Speaker 1: and then the balloon. But at one point they'll do that,

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Speaker 1: and business is a peripheral player in that. So I

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Speaker 1: think I think business will help give it advice on

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Speaker 1: how to do things. If you're gonna have an outbound

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Speaker 1: investment controls. I just said that way that works, but

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Speaker 1: that's a huge bureaucracy, and so so far all the

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Speaker 1: conversation be quite rational about it. I mean, JP Logan

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Speaker 1: obviously has a significant business in China. I'm sure that

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Speaker 1: the government that would listen to you. What are the

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Speaker 1: conversations you have just about sort of trying to, as

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Speaker 1: I say, trying to maintain as coodial relations as possible

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Speaker 1: between the two nations. I mean, for us, we're there

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Speaker 1: and like I said, you know, we're we're basically taking

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Speaker 1: a backseat to American government in this one, and we're

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Speaker 1: gonna we obviously have to do whatever the American government

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Speaker 1: asked us to do, and we're trying to engage in

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Speaker 1: their courage of their own government and with the Chinese

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Speaker 1: government and what those things should be. You know, I'm

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Speaker 1: hoping cooler has prevailed here, but this is why Ukraine

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Speaker 1: is so important. This can cause it to go in

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Speaker 1: a bad direction rather quickly. So, uh, you know, everyone's

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Speaker 1: got to be little questions you talk about around government.

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Speaker 1: Let's talk about the feed from obviously, I just want

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Speaker 1: to talk about the FED for a moment. I have

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Speaker 1: half a dozen posaic questions I can ask about the FED.

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Speaker 1: I think got any of the answer to many of them,

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Speaker 1: stop trying to fight. One fairly easy one is, you know,

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Speaker 1: when do we get to say we're landing, be that

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Speaker 1: hard landing or a soft landing, So when does that

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Speaker 1: begin to a cup? You know, forecasting the futures, as

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Speaker 1: you know, very complicated. The consumer still has a lot

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Speaker 1: more money. They're checking accounts than before COVID. They're spending

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Speaker 1: ten percent more than last year, forty percent more than

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Speaker 1: pre COVID, and it looks like they'll have excess way

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Speaker 1: to spend roughly until the end of the year. And

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Speaker 1: at that point or you can aid it a little

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Speaker 1: bit of a cliff as a soft landing. And also

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Speaker 1: QT has nar start to bite. That also is gonna

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Speaker 1: happen at one point, probably later this year, and you

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Speaker 1: know that's when you're gonna know what these things do.

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Speaker 1: But you we can still have a soft landing. And

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Speaker 1: the other thing about all the economic forecasting is Russia Ukraine.

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Speaker 1: I mean that can change it dramatically and very very quickly.

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Speaker 1: Do you think absent Russia Ukraine we will have a

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Speaker 1: soft landing. I think it's still possible, but I would

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Speaker 1: I look at possibilities. It's still possible, possible. I think

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Speaker 1: mild recessions possible, harder recessions possible. I think it's a

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Speaker 1: good chance that inflation will come down, but not enough

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Speaker 1: by the fourth quarter that may actually have to do more.

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Speaker 1: And I think a lot of things that have happened

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Speaker 1: in the world, think of the bigger trends are inflationary.

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Speaker 1: You know, infrastructure spending, the IRA Act less any trade

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Speaker 1: with you know, certain parts of the world, bringing trade

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Speaker 1: back into America. Those things are all the green transition

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Speaker 1: is going to take a lot of capital to all

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Speaker 1: those things kind of have inflatiary attributes that are very

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Speaker 1: different than we've been through last twenty years. I'm gonna

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Speaker 1: come back to the consumer point in a second. But

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Speaker 1: last year you talked about and you'll let this sort

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Speaker 1: of confluence of three major effectants QT the America rebounding

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Speaker 1: from a sort of post COVID economy fedly strongly, and

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Speaker 1: then oversee the Wall as well. You talked about them

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Speaker 1: sort of leading us into an unprecedented period. How do

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Speaker 1: we get out of that period? You know, it's it's diplomacy.

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Speaker 1: I mean That's why this is not you know, we

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Speaker 1: always talk about uncertainty and the economy and the incertainty,

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Speaker 1: but I call it normal uncertainty. The weathers. You know,

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Speaker 1: we know what the weather's like. That's why these things

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Speaker 1: are different. Qt coming out of COVID, the war in Ukraine.

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Speaker 1: I think it's been pushed out a little bit further.

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Speaker 1: I would have thought we'd be dealing with this a

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Speaker 1: little bit sooner, but it does look like some kind

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Speaker 1: of stuff. It's coming to fruition at the end of

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Speaker 1: this year. Russia, Ukraine, we susciply, don't know. I think

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Speaker 1: it's wrong. It's didn't predict because if you look at

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Speaker 1: the history of wars, they've been pretty much unpredictable and

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Speaker 1: how they play out and which ones affect the global economy,

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Speaker 1: and how they took a lot of wars they didn't

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Speaker 1: affect the global economy, but they were literally in very

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Speaker 1: small parts of the economy. This is not in a

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Speaker 1: small part of the economy. And this is a European nation.

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Speaker 1: It's Russia, and it's oil and you know, major oil

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Speaker 1: and gas supply and food supply around the world. So

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Speaker 1: this is a whole different attribute to it. But then

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Speaker 1: why does a consumer partic here in the US remain

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Speaker 1: as you say, it's fairly bullish there. For over a

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Speaker 1: period of time, their home price has been going up,

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Speaker 1: Jobs are plentiful, ways are going up at the lower end,

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Speaker 1: which I think it's a good thing. They've got a

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Speaker 1: lot of money to check in account. You know, Uh,

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Speaker 1: stocks generally been had gone up for ten or fifteen years.

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Speaker 1: The consumers, if you look at it today, in great shape.

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Speaker 1: But I'm telling you that's going to end at one point.

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Speaker 1: But even if we go to recession, then the consumer

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Speaker 1: is entering a recession in better shape, far better shape

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Speaker 1: than they didn't know way, you know, no way when

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Speaker 1: we run to that recession, No, we did own employment

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Speaker 1: go through the roof. But their home prices are dropping dramatically,

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Speaker 1: jobs are disappearing, the stock market is way down. So

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Speaker 1: this one is a little bit better than that. One

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Speaker 1: of the sort of narratives that it's fairly popular at

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Speaker 1: the moment. The consumer doesn't like consatinty. I would even

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Speaker 1: though as far as saying it's it's sort of one

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Speaker 1: of these false axioms that's you know, that's payble at thought.

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Speaker 1: Now that you know when it's times are on satain

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Speaker 1: it they've seen the freaks out. They stopped spending, they

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Speaker 1: stopped doing the things that consuming dude to keep the

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Speaker 1: economy going. That doesn't seem to be the case here.

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Speaker 1: The consumer's done pretty well through onun sets and keep

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Speaker 1: through COVID, through the wall, through everything else. So I

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Speaker 1: wonder what when we get to this point of you know,

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Speaker 1: the wallet being hit and the consumers saying we're gonna

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Speaker 1: stop spending. Is it just reality catching up with them?

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Speaker 1: This is some kind of flectual point. Where is it

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Speaker 1: just that they run out of money? I arely is

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Speaker 1: destroyed by COVID, including quote uncertainty, so you have you're

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Speaker 1: obviously correct, they're confidence, consumer covers is dropping it. But

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Speaker 1: I think your pocketbook trump's confidence. But they have a

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Speaker 1: lot of money. They tend to spend it. And they

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Speaker 1: you see here like look at the travel in Miami

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Speaker 1: and the building and the optimism around. If you ask

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Speaker 1: me how they're doing, it's very good. And then they

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Speaker 1: tell they're not coming by the economy so jobs are plentiful,

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Speaker 1: wages are going up. I mean, what that's what's really

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Speaker 1: affecting them. You know, when they wake up the morning,

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Speaker 1: they feel pretty good about that, and then they read

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Speaker 1: the paper and of course you can get a little depressed.

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Speaker 1: And at the end of this year, it's the wall

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Speaker 1: to the end of this year that sort of begins

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Speaker 1: to tell it looks it looks like the ex cashall

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Speaker 1: be disappearing, and then but the job's still there, so

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Speaker 1: you could That's why he say you could have a

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Speaker 1: softmanding zone now Jeffrey Epstein obviously his specter continues to

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Speaker 1: haunt a global elite and most recently JP Morgan have

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Speaker 1: been sort of caught up in it. How has that

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Speaker 1: made you feel? You know, I can't talk about litigation,

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Speaker 1: but you should. You should know that a JP Moore,

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Speaker 1: we got top experts, including some of the best people

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Speaker 1: that come out of the DOJ, etc. Who review and

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Speaker 1: make judgment decisions like this, and we've they've generally do

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Speaker 1: a very good job. But how has it made you feel?

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Speaker 1: As the CEO of Jaken Morgan as a fingerhead for

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Speaker 1: the back, It's unfortunate, but it's life. And look, we're

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Speaker 1: here in Florida. We have to talk about politics because

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Speaker 1: we always talk about politics. Obviously we're into sentis its backyard.

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Speaker 1: What do you make of his if you like hands

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Speaker 1: on approach to business and is that something you would

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Speaker 1: like to see more of in even higher office. An

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Speaker 1: approached dessentis, yeah, you know, I I've learned and listen

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Speaker 1: and read and stuff like that. You know, it has

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Speaker 1: got a little complicated between business and government and stuff

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Speaker 1: like that. But but you know, anyone here knows that

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Speaker 1: I'm a full throated, red blooded American patriot supporter free enterprise.

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Speaker 1: So you know, I hear the complains on both sides,

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Speaker 1: but you know, you listen to learn from I don't

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Speaker 1: worry that much about it. And we've been We've loved Florida.

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Speaker 1: We're growing in Florida left and right. You know, small businesses,

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Speaker 1: large companies we got I've got had many total employees

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Speaker 1: we have for you. I'm on my way to Tampa.

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Speaker 1: We've got you know, major operations there Orlando, major operations

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Speaker 1: were opening branches and so the mayor just joined us

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Speaker 1: at a small business that we did here. We're very

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Speaker 1: pro pro Florida. And this is long dates at Florida.

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Speaker 1: This isn't part of the sort of recent influx of

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Speaker 1: capital its Florida or financial wild in Florida pass. I

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Speaker 1: think they've been great. I mean, you know, if you

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Speaker 1: are running the state, you know you should be thinking,

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Speaker 1: how can I make this date off good? Well off

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Speaker 1: my people. So Florida likes business. They want you to

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Speaker 1: come here, you come the floor. You see the apter

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Speaker 1: Texas is the same way. You know if I was

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Speaker 1: some other states. Everything about why do people like going

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Speaker 1: to these dates is their taxes, is their pro business.

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Speaker 1: They want better life for the people. It's not necessary

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Speaker 1: some of the parts we've talked about. So you know,

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Speaker 1: we now have more employees in Texas than the New

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Speaker 1: York's date. You know it should have been there way,

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Speaker 1: but Texas logically to be there. And when you go

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Speaker 1: through their optimistic they're optimistic here pro American, opimistic, pro business. No. Unfortunately, No.

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Speaker 1: Every year there's a sort of tech topic to jur

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Speaker 1: that we talk about last year as a metaverse and

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Speaker 1: I think we talked briefly about you appearing in a

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Speaker 1: non physical form in the lobby of the Mets verse.

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Speaker 1: This here, it's it's AI. I asked chat TPT what

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Speaker 1: I should ask Jamie Diamond. I was hoping you would

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Speaker 1: come up with a really smart answer, I wouldn't need

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Speaker 1: to write any of my questions. I could get it

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Speaker 1: to do the whole interview for me. So so it didn't.

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Speaker 1: Unfortunately it asked what would I asked Jamie Diamond about

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Speaker 1: AI and what meant the future to investment lanking. So

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Speaker 1: AI is real. This is not total, that's not cryptn't

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Speaker 1: this is a technology which is staggering. We already lose

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Speaker 1: three hundred AI. We have thousands of people involved, thousand

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Speaker 1: involved data, machine learning, natural language process saying. We have

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Speaker 1: two hundred people in AI research labs, but we're already

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Speaker 1: used to do risk fraud, marketing, prospecting. And it's the

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Speaker 1: tip of the iceberg. So you know, to me, this

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Speaker 1: is this is extraordinary. And the other thing to keep

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Speaker 1: in mind there's good use, but bad guys are gonna

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Speaker 1: use it too, so it's a little bit of arms

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Speaker 1: race and how you have to use it to protect

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Speaker 1: your company, protect your clients, protect data, etc. And we're

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Speaker 1: fully engaged. And the other thing you have to keep

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Speaker 1: about AI you need to be in the cloud to

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Speaker 1: use the compute power fundamentally that you need for AI.

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Speaker 1: And so that's why the cloud digital AI. They're all

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Speaker 1: kind of related that way, what was behind the decision

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Speaker 1: to ban chap GPT on the on the trading floor.

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Speaker 1: It on company owned devices. That's why you could do

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Speaker 1: it in your own device. But we also lab people

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Speaker 1: use it within our own firewalls, so we didn't take

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Speaker 1: it away just you have to go within our firewall

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Speaker 1: to use it. And it was just for control purposes

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Speaker 1: and risper. There's no wasn't a statement of any time

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Speaker 1: before we end up, I want to get on seleverage finance. Obviously,

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Speaker 1: that's in large part why we Hey, it's talk about

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Speaker 1: the conference. One of the things stamping mulgan still get

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Speaker 1: the montment. It's very interesting is lending from its own

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Speaker 1: balanced sheet and direct lending if you like. At the moment,

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Speaker 1: I think it's ten billion dollars is what's been allocated.

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Speaker 1: How big can that business gap? Ye? So you know,

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Speaker 1: I mean, it's amazing. And this is when you look

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Speaker 1: at something like this for reviewers, American capitalism. There are

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Speaker 1: two thousand investors here from around the world, hundreds of

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Speaker 1: companies still inventing ideas and growing and expanding both the

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Speaker 1: US and overseas. It is it is extraordinary. So direct

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Speaker 1: lending You're obviously one of the biggest lenders out there,

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Speaker 1: but a lot of people here are also huge lenders.

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Speaker 1: So you know, I meet with them all, and you know,

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Speaker 1: direct lending away from banks to become equally in size,

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Speaker 1: and not to think of those healves as competitors there

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Speaker 1: and there. You know that's a lot, but we deal

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Speaker 1: with competitors and collaborators all the time. So we do

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Speaker 1: direct lending and all. It is fundamental if your viewers,

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Speaker 1: you know, unitron quicker, more flexibility, and certain type of

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Speaker 1: covenants not necessarily cheaper for the borrower, by the way,

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Speaker 1: so you gotta look at it all things. So we've

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Speaker 1: done I think ten million forty deals. We can do

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Speaker 1: a lot more, and you know, we can work with

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Speaker 1: partners or some of the deals, et cetera. But we'll

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Speaker 1: do what we need to do to compete. It's feel

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Speaker 1: someone pass to ask you about succession. You get asked

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Speaker 1: about it all the time. I'm not going to do that,

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Speaker 1: but I am interested. You talk a lot about the

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Speaker 1: need for sort of unified responses to global conflict. You

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Speaker 1: talk a lot about things that are needed domestically, whether

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Speaker 1: it's better health, better education, raising wage inequality or reducing

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Speaker 1: I should say wage inequality. It seems very obvious you

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Speaker 1: could go into public office if you chose to when

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Speaker 1: you leave jam molding. Its something we can expect. I'm

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Speaker 1: not going to go into public service. I love what

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Speaker 1: I do here. You know you mentioned succession. Are you

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Speaker 1: enjoy it? I think you should practice it a little

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Speaker 1: bit before you go into it. And I mean I

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Speaker 1: feel like I do. Here's a huge contribution to my country,

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Speaker 1: my clients around the world, etc. And the other thing

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Speaker 1: about succession you got you guys already know who that

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Speaker 1: we have a lot of potential successors, so you can

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Speaker 1: add right about it frequent exactly, so you know I

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Speaker 1: couldn't answer that you already know all right, Jamie Diamond,

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Speaker 1: great conversation, Thanks so much for having us. And with that,

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Speaker 1: I'll tie it back to you in New York. That

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Speaker 1: was ed Hemon along with CEO and chairman of JP

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Speaker 1: Morgan Chase. Jamie Diamond covered a lot of topics. Yeah,

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Speaker 1: for me. The most interesting thing he said by far

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Speaker 1: was that the US consumer is spending ten percent more

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Speaker 1: this year than he did last year, and forty percent

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Speaker 1: more this year than pre pandemic stimmy checks, stimulus savings.

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Speaker 1: I guess that's what's driving. But it's gonna run out.

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Speaker 1: He said that excess cash that the consumer has is

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Speaker 1: gonna last through the end of this year. YEP. Very interesting,

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Speaker 1: so great interview there at Hamond Bloomberg Television along with

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Speaker 1: Jamie Diamond, JP Morgan Chase at their Leverage, Finance and

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Speaker 1: HILD conference down in Miami. Thanks for listening to the

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Speaker 1: Bloomberg Markets podcast. You can subscribe and listen to interviews

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Speaker 1: with Apple Podcasts or whatever podcast platform you prefer. I'm

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Speaker 1: Matt Miller. I'm on Twitter at Matt Miller nineteen seventy three.

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Speaker 1: And I'm fall Sweeney. I'm on Twitter at pt Sweeney.

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Speaker 1: Before the podcast, you can always catch us worldwide at

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Speaker 1: Bloomberg Radio