WEBVTT - JPMorgan Chase Chairman & CEO Jamie Dimon Talks Reducing Hurdles to Going Public 0:00:00.080 --> 0:00:01.200 Let's go now to London. 0:00:01.280 --> 0:00:04.680 We're JP Morgan, Chairman and CEO. Jamie Diamond joins Bloomberg 0:00:04.680 --> 0:00:10.920 de Lisa Abrahmitz for an exclusive interview. Lisa, Katie, thank 0:00:11.000 --> 0:00:13.080 you so much, really appreciate it. I am here with 0:00:13.160 --> 0:00:15.880 Jamie Diamond at the Tech Stars conference at the Novo 0:00:15.960 --> 0:00:19.239 Hotel in London, and we're going to get into a 0:00:19.280 --> 0:00:21.119 bunch of different things, a lot of the questions that 0:00:21.160 --> 0:00:24.639 people have, but one main question is we're seeing the 0:00:24.680 --> 0:00:25.840 sort of explosion in tech. 0:00:26.160 --> 0:00:27.440 A lot of people are pausing it. 0:00:29.160 --> 0:00:31.480 How are you sort of seeing the advancements that are 0:00:31.520 --> 0:00:34.240 most important so far and going forward? What's most excited? 0:00:34.320 --> 0:00:36.159 What's the most exciting for you? So, first of all, 0:00:36.159 --> 0:00:38.960 welcome everybody, thrilled to be here. You know, first of all, 0:00:38.960 --> 0:00:40.280 you got to look at tech in the big picture. 0:00:40.320 --> 0:00:43.159 It's been changing society for one hundreds of years with 0:00:43.280 --> 0:00:47.680 agriculture and printing and steam engines and electricity and the 0:00:47.720 --> 0:00:50.280 internet and tech rows in itself. You know, the Internet 0:00:50.280 --> 0:00:55.360 caused ABNC semiconductors, and girla glass caused the iPhone, and 0:00:55.440 --> 0:00:58.880 so this is another wave. We're here in London because 0:00:58.920 --> 0:01:00.600 we call it the tech the tech comes here, but 0:01:00.800 --> 0:01:03.280 it's also dasper. Now if you went back ten years, 0:01:03.480 --> 0:01:06.120 it was mostly in the United States and concentrated in 0:01:06.120 --> 0:01:09.520 Silicon Valley, Boston, New York. Now it's everywhere. You know. 0:01:09.560 --> 0:01:13.520 We have a tech center in Berlin, Glasgow, UH, Edinburgh, 0:01:14.000 --> 0:01:15.360 and I whish. I think it is great you have 0:01:15.400 --> 0:01:18.720 more innovation taking place. I think it's really important for Europe. Uh. 0:01:18.720 --> 0:01:21.160 And obviously the thing now is all about AI and 0:01:21.200 --> 0:01:23.479 AI which I think is real and it's gonna change 0:01:23.520 --> 0:01:26.160 an awful lot of things. Can you mention one other things? 0:01:26.160 --> 0:01:28.160 There's always been a fear of tech that's gonna take 0:01:28.160 --> 0:01:30.760 away jobs, but you gotta look at the big picture, 0:01:30.760 --> 0:01:33.120 and sometimes it does. But in the big picture, it 0:01:33.200 --> 0:01:36.760 is why mankind has gotten better and better, lives longer, 0:01:36.840 --> 0:01:40.240 GDPs go up, PRODUCTIVY goes up, health gets better, work 0:01:40.319 --> 0:01:42.480 hours go down. So be able to keep in mind 0:01:42.480 --> 0:01:44.720 the benefits are huge. We probably have to find a 0:01:44.760 --> 0:01:46.560 better way to help the people get hurt by it. 0:01:46.959 --> 0:01:48.920 So you talk about the people who are getting hurt 0:01:48.960 --> 0:01:50.520 by it. And in a previous interview, when you were 0:01:50.520 --> 0:01:53.400 talking about how it's gonna reduce some. 0:01:53.440 --> 0:01:55.080 Jobs and it's gonna create others. 0:01:55.480 --> 0:01:57.320 Which jobs do you expect to get eliminated and which 0:01:57.400 --> 0:01:58.639 jobs do you expect to get created. 0:01:58.680 --> 0:02:00.280 Yeah, we don't really know yet, you know, I mean, 0:02:00.640 --> 0:02:02.120 we shouldn't put our head in the sand. We know 0:02:02.160 --> 0:02:04.440 it can be true. So a lot of jobs. Your 0:02:04.560 --> 0:02:07.680 job will be enhanced. You'll get more research, more questions, 0:02:07.800 --> 0:02:10.640 more he is you'll have like a real super assistant 0:02:10.680 --> 0:02:12.720 chief of staff on your shoulder and you wake up, 0:02:13.040 --> 0:02:15.520 but you're still to be interviewing people. You know, other jobs. 0:02:15.560 --> 0:02:18.080 It will handle you know, error rates or you know, 0:02:18.600 --> 0:02:21.480 it already hedges our trading equity floors and it's already 0:02:21.520 --> 0:02:25.040 been used for risk fraud marketing hasn't really eliminated on jobs, 0:02:25.240 --> 0:02:27.840 but it created effect this in terms of productivity by 0:02:28.040 --> 0:02:30.960 you know, reducing fraud losses and so and then you know, 0:02:30.960 --> 0:02:33.959 if it changes jobs and operations and elsewhere, we'll deal 0:02:34.000 --> 0:02:36.320 with it. You know, we have turnover twenty percent a year. 0:02:36.560 --> 0:02:39.720 We'd love to retrain people, redeploy the re educate them. 0:02:40.040 --> 0:02:42.560 And so I'm not worried about it. And if it 0:02:42.600 --> 0:02:44.440 works with the customer and the client, we can kind 0:02:44.480 --> 0:02:47.600 of do more. That says for successful company, if you're 0:02:47.600 --> 0:02:51.000 growing and expanding, you're actually almost always getting jobs. So 0:02:51.040 --> 0:02:52.480 you know, to me, I want to have a successful 0:02:52.480 --> 0:02:55.320 company and we'll deal with whatever the downside is of AI. 0:02:55.639 --> 0:02:57.920 So I was speaking with another head of a major 0:02:58.000 --> 0:03:01.080 US bank who is saying that hess his bank to 0:03:01.120 --> 0:03:03.959 keep growing in terms of business, in terms of assets, 0:03:04.400 --> 0:03:06.600 but stay the same size when it comes to staff. 0:03:06.960 --> 0:03:08.359 Do you feel the same for JP and Morgan? 0:03:08.840 --> 0:03:10.840 I don't. I don't really know to tell the truth, 0:03:10.880 --> 0:03:13.520 and I don't like try to predetermine that. So if 0:03:13.520 --> 0:03:15.919 you look what we're doing, we're still opening branches. We're 0:03:15.960 --> 0:03:19.480 still opening branches and cities around the world. We've added 0:03:19.880 --> 0:03:22.720 a thousand people in AI itself. You know, we're adding 0:03:22.840 --> 0:03:25.960 people in data scientists. Journey to the Cloud got forty 0:03:25.960 --> 0:03:28.120 four thousand yeers. So I think we can see is 0:03:28.280 --> 0:03:31.639 some down some up in general. If we're growing company, 0:03:31.680 --> 0:03:33.720 I would expect to go up a little bit in general. 0:03:34.360 --> 0:03:37.480 Typically, the Tech Stars is a conference for a lot 0:03:37.520 --> 0:03:41.040 of founders start to test the waters for IPOs, potentially 0:03:41.040 --> 0:03:45.200 look to go public. There's been a deterrence to really 0:03:45.200 --> 0:03:47.880 going public as quickly as in the past, particularly for 0:03:47.920 --> 0:03:50.520 tech companies, just because there's so much private capital out there. 0:03:51.080 --> 0:03:51.880 Do you still see that. 0:03:52.000 --> 0:03:54.440 Is that a structural change or is that something that's 0:03:54.440 --> 0:03:55.440 cyclical just having. 0:03:55.320 --> 0:03:58.360 To do with race. It's a complicated subject. Yes, there's 0:03:58.400 --> 0:04:00.360 private capital, and I think it's a good thing that 0:04:00.400 --> 0:04:03.040 people can raise money in the private capital markets, you know, 0:04:03.080 --> 0:04:06.360 but it's a little odd that, you know, public markets 0:04:06.400 --> 0:04:09.720 are quite elevated and IPOs haven't come very much yet. 0:04:09.760 --> 0:04:12.720 So but part of it is they have access to capital, 0:04:12.800 --> 0:04:14.960 parts they're waiting. Part of it is they reduced their 0:04:15.000 --> 0:04:16.880 own cash burn they don't need as much cash. So 0:04:16.920 --> 0:04:19.599 it's a whole bunch of reasons why they're not going public. 0:04:19.760 --> 0:04:22.640 But I think eventually you do need healthy public markets 0:04:22.680 --> 0:04:25.840 to have people look with fire their positions, which all 0:04:25.880 --> 0:04:27.720 the venture cabs and lunch with a bunch of venture 0:04:27.720 --> 0:04:29.560 capitals they all are going to want to do is 0:04:30.240 --> 0:04:32.200 actually need to do at one point. So do you 0:04:32.200 --> 0:04:33.679 expect that to pick up in the near future. 0:04:33.760 --> 0:04:35.920 Do you think it's going to remain needed for the frustration. 0:04:35.680 --> 0:04:37.440 I don't know. I honestly don't know. I think it 0:04:37.440 --> 0:04:40.280 may very well stay muted, because you know, markets may 0:04:40.360 --> 0:04:43.320 come down as opposed to just go up endlessly, and 0:04:43.440 --> 0:04:45.360 they may find other sources. So when I speak to 0:04:45.400 --> 0:04:48.119 a lot of private equity and private cap, private venture 0:04:48.160 --> 0:04:50.120 and stuff like that, they tell you they have more 0:04:50.200 --> 0:04:53.600 non public sources. I do think it's very important that 0:04:53.640 --> 0:04:56.360 our policy make us understand, you know, because even here 0:04:56.960 --> 0:04:59.080 in the United States, we've made it hard to go public. 0:04:59.560 --> 0:05:03.279 You know, we've eliminated research on smaller companies. We've you know, 0:05:03.320 --> 0:05:06.680 we've the costs so much higher. Those litigation expensive to higher. 0:05:07.040 --> 0:05:10.000 You know, filing with the SEC is higher. So I 0:05:10.000 --> 0:05:11.840 think it would be really incumbany of us trying to 0:05:11.880 --> 0:05:14.280 make it easier and cheaper to go public, allow more 0:05:14.279 --> 0:05:16.279 of risks to be born in the public markets. And 0:05:16.320 --> 0:05:18.000 we've got to figure out way to do that. We 0:05:18.040 --> 0:05:21.040 actually have ten takeaways from lunch where I want to 0:05:21.080 --> 0:05:22.560 take a good look at it. 0:05:22.720 --> 0:05:25.600 So that raises a question of where people are going public. 0:05:25.760 --> 0:05:29.000 And we're here in London, which has behind a number 0:05:29.040 --> 0:05:32.200 of other areas, particularly New York, and has lost cloud 0:05:32.240 --> 0:05:35.560 in other areas too, especially since Brexit. Do you think 0:05:35.600 --> 0:05:37.640 that this is just a momentary blip or do you 0:05:37.640 --> 0:05:39.880 think that just on a broader level, London is kind 0:05:39.880 --> 0:05:41.719 of losing a bit of its cloud. 0:05:41.800 --> 0:05:44.599 Is a major financial center. So I think Perchull, I 0:05:44.640 --> 0:05:47.240 love the fact if you listen to the current labor government, 0:05:47.320 --> 0:05:51.880 they're talking about growth, investment, markets, capital markets, and they 0:05:51.920 --> 0:05:53.880 do need to do those things to help her recover. 0:05:54.200 --> 0:05:55.960 If they didn't do those things, no, I think it 0:05:55.960 --> 0:05:58.080 will become more permanent. Then you know, a lot of 0:05:58.080 --> 0:05:59.880 people they go to. The United States is more liquid. 0:06:00.600 --> 0:06:02.240 You know, it's easy to do, I mean and so 0:06:02.560 --> 0:06:04.280 or they have a lot of business there, and which 0:06:04.480 --> 0:06:06.960 also making this in a great business environment will also 0:06:07.000 --> 0:06:10.640 help companies going public here. But right now the Nasdaq 0:06:10.720 --> 0:06:13.600 or York Stock has change. They're just more attractive places 0:06:13.640 --> 0:06:16.440 to go, and we'll see how that pans out. I 0:06:16.480 --> 0:06:19.160 think it's important we want to help them do better here, 0:06:19.480 --> 0:06:21.600 and I'm not in favor of just advantage in the 0:06:21.720 --> 0:06:24.279 United States at the expense of Europe. But I do 0:06:24.400 --> 0:06:27.400 think that Europe needs to focus on Mario Drogis report. 0:06:27.760 --> 0:06:29.440 There are a lot of things in there that they 0:06:29.480 --> 0:06:31.960 need to do to get productivity back and growth back 0:06:32.000 --> 0:06:35.080 and markets back. They need to capital markets Union, for example, 0:06:35.160 --> 0:06:37.400 which they've been talking about for years. They actually do 0:06:37.440 --> 0:06:41.080 really need it to foster growth around European countries. 0:06:41.680 --> 0:06:45.000 On a broader level, just aside from the London market. 0:06:45.200 --> 0:06:47.640 What kind of activity do you see in the pipeline 0:06:48.000 --> 0:06:51.120 for fourth quarter? I mean, do you see for luctance 0:06:51.160 --> 0:06:53.520 by companies to really engage with major actions because of 0:06:53.560 --> 0:06:56.400 the election, because of potential volatility, because of geopolitics, or 0:06:56.440 --> 0:06:58.080 do you see it really ramping up? 0:06:58.240 --> 0:06:59.920 Yeah. So I've always you know, we always about back 0:07:00.240 --> 0:07:03.000 and I always told by Opia be careful because backlogs 0:07:03.320 --> 0:07:06.440 tend to grow and expand and stop. There's a pretty 0:07:06.440 --> 0:07:09.520 good backlog growing of IPOs of companies. You know, whether 0:07:09.520 --> 0:07:11.920 it happens or not is a different thing. And M 0:07:12.000 --> 0:07:14.720 and A yes, I do believe I can prove is 0:07:14.720 --> 0:07:18.840 more anecdotal. That is tampered quite a bit by not 0:07:18.920 --> 0:07:22.280 the election, maybe the election, but by rules and regulations. 0:07:22.320 --> 0:07:25.760 And we took to a lot of boards of directors here. 0:07:25.880 --> 0:07:28.040 You know they're talking about is that is the risk 0:07:28.040 --> 0:07:29.800 capital there you can take the risk. They want to 0:07:29.800 --> 0:07:32.320 be very conservative in the United States. It's more about 0:07:32.680 --> 0:07:34.520 you know, can you wait eighteen to twenty four months 0:07:34.520 --> 0:07:36.320 to close a deal? And mean that creates a lot 0:07:36.360 --> 0:07:38.320 of risks for a company, you know, particularly if you 0:07:38.320 --> 0:07:39.920 go to banking. I know a lot of the banks. 0:07:40.240 --> 0:07:43.040 I think they should be allowed to do deals. They're very, 0:07:43.280 --> 0:07:46.480 very reluctant because they can't wait. One of the last 0:07:46.720 --> 0:07:48.920 bank to the necessaries took three years. And I think 0:07:48.920 --> 0:07:52.320 if rem there's a ninety day regulatory requirement, well obviously 0:07:52.320 --> 0:07:54.480 that's not taking place anymore. And we do have to 0:07:54.520 --> 0:07:57.280 fix these things. You want an active, healthy M and 0:07:57.320 --> 0:08:00.760 a market just quickly. Not all bad for competition, even 0:08:00.760 --> 0:08:03.320 though I think it's true in certain cases. But you know, 0:08:03.440 --> 0:08:05.720 we just become like an anti M and a country, 0:08:05.720 --> 0:08:06.600 and that's a bad idea. 0:08:06.720 --> 0:08:08.960 Okay, Just let's say that there's somebody else in charge 0:08:09.000 --> 0:08:11.880 of the FTC and there are some different kinds of 0:08:12.240 --> 0:08:16.040 rules and sticks that people have to advance over. How 0:08:16.120 --> 0:08:18.240 much consolidation do you expect in the banking industry? 0:08:18.440 --> 0:08:20.440 So for the FTC, and I want to make very 0:08:20.440 --> 0:08:23.400 clear about this. You know, say to you know, to hammer, 0:08:23.400 --> 0:08:25.360 everything is in nail. They're a little bit like that. 0:08:25.600 --> 0:08:27.960 But that doesn't mean they aren't right about certain things 0:08:27.960 --> 0:08:31.560 they say. I just want to separate that. Look, I 0:08:31.560 --> 0:08:33.920 think there are four thousand banks the United States. They're 0:08:34.000 --> 0:08:36.360 in a different position. You could be a very profitable 0:08:36.400 --> 0:08:38.559 community bank. So I don't think the idea you have 0:08:38.600 --> 0:08:41.440 to merge is true. But if you're competing in a certain 0:08:41.480 --> 0:08:44.080 business for certain clients and certain sizes, you may need 0:08:44.240 --> 0:08:46.679 kinds of scale, and you know they should determine so 0:08:46.760 --> 0:08:49.920 you do need consolidation. A lot of the mid sized 0:08:49.960 --> 0:08:52.640 banks want to do it. They shouldn't be hampered, you know, 0:08:52.679 --> 0:08:54.040 and they would tell you if I can't do it, 0:08:54.040 --> 0:08:57.280 you're basically seeding the ground to JP Morgan, and I 0:08:57.320 --> 0:09:00.040 think that's unfair. They should be allowed to merge. The 0:09:00.200 --> 0:09:02.320 boards of directors should be allowed to make that decision 0:09:02.559 --> 0:09:04.360 based on what they think is the best interest of 0:09:04.400 --> 0:09:07.679 the shareholders. You know, this notion that government should get 0:09:07.679 --> 0:09:09.560 involved in every single little bank, do you like? He's 0:09:09.640 --> 0:09:12.240 just wrong, And you know they're adding social values to 0:09:12.240 --> 0:09:14.840 everything they do. It should be about safety and soundness, 0:09:14.880 --> 0:09:17.800 and a board of directors that says we need to merge, 0:09:17.840 --> 0:09:20.640 we want to merge, probably means that heading for a 0:09:20.679 --> 0:09:23.880 safe and sounder bank, that's their desire. You can give 0:09:23.880 --> 0:09:26.200 a lot of examples where it doesn't work. It doesn't 0:09:26.200 --> 0:09:28.400 mean it shouldn't be allowed. And I think we've got 0:09:28.440 --> 0:09:30.880 to be a little more open about letting these things 0:09:30.920 --> 0:09:32.760 take place and letting them take place quickly. 0:09:33.040 --> 0:09:35.720 Aside from just some of the regulatory overhang, there is 0:09:35.720 --> 0:09:38.880 this question about how much in general the markets are 0:09:38.880 --> 0:09:39.959 going to open up, and a lot of that has 0:09:39.960 --> 0:09:42.320 to hinges on the hinge on the economy. You mentioned 0:09:42.360 --> 0:09:46.120 earlier that you are more pessimistic about a soft landing. 0:09:46.280 --> 0:09:48.280 I think you gave it a thirty five percent probability 0:09:48.280 --> 0:09:48.959 back in April. 0:09:49.400 --> 0:09:50.760 Do you still think that or do. 0:09:50.679 --> 0:09:52.720 You think that the probability has gone off with some 0:09:52.760 --> 0:09:54.000 of the good data that we've been getting. 0:09:54.120 --> 0:09:57.640 Yeah. No, And the important I'm not talking about forecasting 0:09:57.679 --> 0:10:00.920 twenty twenty five, and I just think there's a lot 0:10:00.960 --> 0:10:03.079 of moving parts, a lot of things in the future, 0:10:03.080 --> 0:10:06.080 which inflationary these you know, the most important thing taking 0:10:06.120 --> 0:10:09.760 place of these wars overseas geopolitics, you know, they're terrible, 0:10:09.840 --> 0:10:12.840 humane suffering, you know, but also the the you know, 0:10:12.920 --> 0:10:15.920 a bunch of these countries acting in cahoots against Western interests, 0:10:15.920 --> 0:10:19.720 against Israel, against Ukraine, against the United States, and that's 0:10:19.720 --> 0:10:21.720 really serious. So I can look at a long amount 0:10:21.720 --> 0:10:25.000 of serious things. Soft layings are hard. I hope it happens. 0:10:25.040 --> 0:10:27.920 I don't know. I just wouldn't count my eggs in 0:10:27.920 --> 0:10:31.520 that one. And markets are open. When you say open, 0:10:31.559 --> 0:10:34.400 they're very you know, values are high, they're not low, 0:10:34.720 --> 0:10:38.040 both equities and bonds. You know, credit spreads are very low. 0:10:38.120 --> 0:10:40.960 So they're open, but people are standing. Not open for 0:10:41.000 --> 0:10:43.400 i pos, so some IPOs when we just did one 0:10:43.400 --> 0:10:44.920 of the larger word of the year like last week. 0:10:45.280 --> 0:10:48.040 They're open for those who the market wants to buy today, 0:10:48.440 --> 0:10:50.320 you know, but don't assume that they're not open. And 0:10:50.400 --> 0:10:52.520 you know, sometimes people would go public they don't like 0:10:52.559 --> 0:10:55.640 the price. That's a very different thing, and you should 0:10:55.640 --> 0:10:58.040 think twice about that when you think you know where 0:10:58.040 --> 0:10:59.880 the company's worth much more than the market might know. 0:11:00.640 --> 0:11:02.839 That maybe it's sort of an assessment of what you're 0:11:02.840 --> 0:11:05.720 looking for rather than the actual market being closed. You know, 0:11:05.920 --> 0:11:07.760 you said that there are a lot of inflationary things 0:11:08.040 --> 0:11:10.000 that are coming down the pike. Do you think that 0:11:10.080 --> 0:11:11.520 it was a mistake for the Fed to cut by 0:11:11.559 --> 0:11:12.520 fifty basis points? 0:11:12.640 --> 0:11:15.240 Oh? Actually, I mean you gotta separate the hear and 0:11:15.320 --> 0:11:19.160 now inflation has definitely been coming down. You know, they 0:11:19.240 --> 0:11:22.480 don't wanna go into recession. Unemployed has been going up, 0:11:22.760 --> 0:11:24.760 They raised race, they were late raising rage, but they 0:11:24.800 --> 0:11:27.120 raised it very high, rapidly to five percent of I 0:11:27.160 --> 0:11:29.080 think it is the right thing, and they're right to 0:11:29.080 --> 0:11:30.679 take their foot of the guests in that one. I 0:11:30.720 --> 0:11:33.320 don't think it matters that much fifty to twenty five, honestly, 0:11:33.559 --> 0:11:36.520 but I think that was okay. If inflation comes back, 0:11:37.240 --> 0:11:40.959 I'm looking at future things, the remilitation of the world's inflationary, 0:11:41.200 --> 0:11:44.840 the physcal deficits of the world between United States inflationary, 0:11:45.200 --> 0:11:50.080 the green economies, inflationary, demographics are inflationary. Uh, it's very possible. 0:11:50.240 --> 0:11:52.199 Energy prices down the road. I'm talk about two or 0:11:52.200 --> 0:11:55.080 three years of inflationary those will hit later. You know, 0:11:55.080 --> 0:11:57.440 they should react at that time to those things, but 0:11:57.480 --> 0:11:59.400 they h I don't think you can anticipate that. We 0:11:59.440 --> 0:12:01.520 don't know that that's going to happen. I'm so glad 0:12:01.559 --> 0:12:03.520 you grow up the deficit. I watched the Treasury auctions. 0:12:03.559 --> 0:12:04.840 There's another three year one today. 0:12:05.080 --> 0:12:07.160 I watch them every time, wondering are we going to 0:12:07.160 --> 0:12:10.880 start seeing disruption from some of the concerns that yourself 0:12:11.200 --> 0:12:13.160 that you bring up, but also every single investor who 0:12:13.200 --> 0:12:14.880 I speak to is it's the same thing. Are you 0:12:14.920 --> 0:12:18.160 surprised that the market hasn't priced in a higher structural 0:12:18.200 --> 0:12:20.240 deficit in the way of higher yields or at least 0:12:20.240 --> 0:12:21.760 more volatility, at least at auctions. 0:12:22.120 --> 0:12:24.040 Yeah. Well, I have a lot of comments that one. 0:12:24.600 --> 0:12:27.600 Commodity markets often though, price things in so they actually happen, 0:12:28.360 --> 0:12:31.319 and so it hasn't happened yet, you know, the higher inflation, 0:12:31.400 --> 0:12:34.000 the higher structural stuff. Even though the deficits are there, 0:12:34.120 --> 0:12:38.880 there's also sentiment inventory supplying demand of you know, of 0:12:38.920 --> 0:12:41.800 capital good. So it's very hard to say. But that's 0:12:41.840 --> 0:12:43.880 why I think that longer rates may actually stay here 0:12:43.920 --> 0:12:45.480 and tick up a little bit as opposed to go 0:12:45.559 --> 0:12:49.079 down because of these huge deficits in the United States 0:12:49.280 --> 0:12:51.600 and then the markets reacting with the word you used 0:12:51.679 --> 0:12:55.680 of volatile or something like that. It's not always bad. 0:12:55.760 --> 0:12:58.120 I mean, I think we overreact sometimes to volatile markets, 0:12:58.400 --> 0:13:01.280 but I do think they'll happen again. Your dealer inventories 0:13:01.280 --> 0:13:04.520 are very low. Banks of the big market makers are 0:13:04.600 --> 0:13:07.360 very constrained. Not today, I mean, we have this anomaly 0:13:07.480 --> 0:13:09.679 where j Moore is going to have a trillion dollars 0:13:09.679 --> 0:13:13.319 of cash and unable to intermediate treasury markets to repail 0:13:13.400 --> 0:13:17.640 markets completely conservatively because we're required to hold that cash 0:13:17.920 --> 0:13:20.280 in very you know, like central bank reserves something like that. 0:13:20.360 --> 0:13:22.920 So I think when q E, if I gets to 0:13:22.920 --> 0:13:25.559 a certain point, you will see that I may be wrong. 0:13:25.960 --> 0:13:28.120 And again, if it happens, I don't think it's disaster. 0:13:28.240 --> 0:13:30.880 It's not bad for JP Morgan. I do think policy 0:13:30.920 --> 0:13:33.080 makers will get upset. They don't like seeing that type 0:13:33.080 --> 0:13:35.040 of thing, and I think they're fixes to it, and 0:13:35.040 --> 0:13:36.960 I think there's sharp we're going to fixes today. 0:13:37.240 --> 0:13:40.679 Something that you said about how markets sometimes don't respond 0:13:40.800 --> 0:13:44.800 until an event, is there Commodity markets Commodity markets, well. 0:13:44.679 --> 0:13:48.800 So think of stock markets are forecasting earnings and cash 0:13:48.880 --> 0:13:51.240 out five years and ten years and always adjusting it 0:13:51.559 --> 0:13:55.240 and their buyers and sellers and equity prices adjust. But 0:13:55.240 --> 0:13:58.360 if you look at commodity price action, well, sometimes it's 0:13:58.360 --> 0:14:02.000 forecasting the future. Actually is looking at supplying demand today. 0:14:02.559 --> 0:14:06.199 So the most important is supplying demand today with some sentiment, 0:14:06.320 --> 0:14:09.200 some inventory. How quickly you can replace supplying demand. So 0:14:09.240 --> 0:14:11.520 all commandiers are different. But think of the treasures a 0:14:11.559 --> 0:14:13.120 little bit as a commodity. Well do you. 0:14:13.080 --> 0:14:15.120 Think that treasury is especially if you look at it 0:14:15.160 --> 0:14:17.160 as commodity, which is a wonderful way to look at it, 0:14:17.600 --> 0:14:19.400 that there is sort of a catalyst in the election 0:14:19.960 --> 0:14:21.920 with respect to realizing what the deficit could be. 0:14:22.880 --> 0:14:26.160 Yeah. Look, I people are making charts of what everyone 0:14:26.240 --> 0:14:28.200 said and what it might mean for the deficit, what 0:14:28.240 --> 0:14:29.840 they said and what they actually do and actually have 0:14:29.840 --> 0:14:32.520 their completely different things. I'm not going to worry about that. 0:14:32.800 --> 0:14:35.880 I think you should worry about. The deficit today is 0:14:35.920 --> 0:14:38.920 seven percent of GDP. When Vulgar was around, we had 0:14:39.040 --> 0:14:41.320 very high inflation was three and A hadred percent. The 0:14:41.360 --> 0:14:44.600 debt to GDP thirty five percent back then nineteen eighty two. 0:14:45.000 --> 0:14:48.120 It's one hundred percent today. The deficits say, the biggest 0:14:48.120 --> 0:14:52.640 peacetime deficit we ever ran. Deficits by their nature are inflationary, 0:14:53.480 --> 0:14:54.960 and you know, one point we have to deal with this. 0:14:55.160 --> 0:14:57.240 I mean, I would beg the government to set a 0:14:58.400 --> 0:15:02.720 powerful Simpson Balls type committee authrighted by the Congress up 0:15:02.800 --> 0:15:05.240 or down vote. It's probably the only way to do it. 0:15:05.560 --> 0:15:06.960 The other way to do is wait so it's some 0:15:07.040 --> 0:15:09.440 kind of disaster in the market, and then you're kind 0:15:09.440 --> 0:15:10.920 of forced to do it at the wrong time. And 0:15:10.960 --> 0:15:13.120 I don't know when that might be. I will have 0:15:13.320 --> 0:15:15.880 next year, probably not, But you know, in America four 0:15:15.880 --> 0:15:19.040 one hundred and twenty percent to GDP probably, which we 0:15:19.040 --> 0:15:21.320 wait for that hockey stick to start. I don't think so. 0:15:21.480 --> 0:15:23.120 I think it's just a bad way to run risk. 0:15:23.440 --> 0:15:26.360 So you mentioned government Libby Cantrell at pempcos she runs 0:15:26.560 --> 0:15:28.640 public policy over there. Every time she comes on, she 0:15:28.680 --> 0:15:30.560 tells us that when she talks to clients overseas, she 0:15:30.600 --> 0:15:33.720 has to tell them no, Jamie Diamond still isn't running 0:15:33.720 --> 0:15:34.240 for president? 0:15:34.880 --> 0:15:37.320 You get that question so much? Does it annoy you 0:15:37.440 --> 0:15:40.080 or does it flatter you? It's more annoying than that 0:15:40.160 --> 0:15:43.360 because I can't run for president, you know, and there 0:15:43.440 --> 0:15:45.320 was no opening. I mean there's no way that it 0:15:45.360 --> 0:15:48.720 was even possible. So it's a little flattering. But you know, 0:15:48.800 --> 0:15:51.400 I just want to help our government do the right stuff. 0:15:51.720 --> 0:15:53.040 I think there are a lot of things to do 0:15:53.440 --> 0:15:57.080 to make America far better off. And particularly because I've 0:15:57.080 --> 0:15:59.240 mentioned as many times, a lot of things we've done 0:15:59.240 --> 0:16:01.480 which I think are ad whether you're a Democrat or 0:16:01.480 --> 0:16:03.800 Republican and be is supported there has often done the 0:16:03.880 --> 0:16:06.720 name of good have hurt the lower twenty percent. They're 0:16:06.800 --> 0:16:09.200 dying younger, their income didn't go up for twenty years. 0:16:09.400 --> 0:16:11.520 They're the ones who have more crime in neighborhoods, Their 0:16:11.520 --> 0:16:14.480 schools don't work. You know, we should we should acknowledge 0:16:14.480 --> 0:16:16.920 that as citizens to do something about it. Like I said, 0:16:16.960 --> 0:16:19.360 a lot of you know, policies put in place have 0:16:19.440 --> 0:16:22.760 the exact unintended consequence, and that's where they hurt, like 0:16:22.840 --> 0:16:25.920 for example, growing the economy, well the people who helped 0:16:25.960 --> 0:16:28.920 the most at the lower end. And I think we 0:16:28.960 --> 0:16:32.040 have to be very clear headed about how we can 0:16:32.080 --> 0:16:34.280 accomplish what we want to accomplish to lift up all 0:16:34.320 --> 0:16:35.280 of America. 0:16:35.400 --> 0:16:38.680 You have an endorsement candidate, and I wonder why is 0:16:38.720 --> 0:16:40.360 it because you think as the leader of a big 0:16:40.400 --> 0:16:42.800 company you've got to work with anyone, or is this 0:16:42.920 --> 0:16:44.440 just that you can't decide. 0:16:44.200 --> 0:16:46.640 This particular time around. I will decide, okay, and I 0:16:46.680 --> 0:16:50.560 will vote. I reserve the right to do whatever I want. Okay. 0:16:50.680 --> 0:16:52.800 I'm a citizen. I can vote, I can say what 0:16:52.840 --> 0:16:55.520 I want. And as to that, I've never been in 0:16:55.600 --> 0:16:59.720 the private endorsing candidates, you know, and so but I 0:17:00.320 --> 0:17:02.080 I'm thinking through what I want to say or do 0:17:02.200 --> 0:17:02.800 or something like that. 0:17:03.360 --> 0:17:05.800 In a recent uh Washington Post editorial that you wrote 0:17:06.160 --> 0:17:08.440 you talked about how you think it would be important 0:17:08.520 --> 0:17:12.400 for the next president to have a private sector uh 0:17:12.400 --> 0:17:17.240 individual at the cabinet level to really advise Yeah, half, yeah, Okay, 0:17:17.240 --> 0:17:18.560 which positions do you think should be? 0:17:18.840 --> 0:17:20.480 I mean, I look, I look at the government. You know, 0:17:20.560 --> 0:17:25.320 we need the American public needs and deserves very competent, 0:17:25.359 --> 0:17:28.320 effective government. And if you go around, they don't believe 0:17:28.320 --> 0:17:30.639 that's what they have. And you know, so people of 0:17:30.720 --> 0:17:32.239 all these things that government should do, but a lot 0:17:32.280 --> 0:17:34.320 of the things the government does, it doesn't do particularly well. 0:17:34.440 --> 0:17:36.399 It does some things particularly well. It does a lot 0:17:36.400 --> 0:17:38.639 of things only the government can do. But we we 0:17:38.680 --> 0:17:42.600 have to be again cold blooded, clear headed, pragmatic about 0:17:42.640 --> 0:17:45.080 what works doesn't work, and over time they'd be less 0:17:45.119 --> 0:17:47.000 or less people in government who were in the real world. 0:17:47.400 --> 0:17:49.800 You may think whatever you want about you know, I'm 0:17:49.840 --> 0:17:53.359 not blaming economists or e. C. Y or or teachers 0:17:53.520 --> 0:17:57.120