Conversations with: Jamie Dimon

technology's the best they never have the mankind we'd be living in tent and hunting Buffalo and dying in 30 fiber for technology we work five days a week as opposed to being afraid and for a live seven days a week [Music] Jamie Dimon is the CEO of JPMorgan Chase and one of the most influential people in business his work steering the bank to the financial crisis JP Morgan is currently the largest of the u.s. banks showed that he could lead in good times and bad now with new competitive and economic pressures on the horizon we talked with Jamie about how we navigate JPMorgan about the role of regulation and about what he thinks private enterprise needs to do to help communities that are falling behind I wanted to start with something that was big news and is capturing so many people's attention which is Amazon buying Whole Foods and you look at this 13.7 billion dollar deal a tech giant moving into groceries you since 2014 have been saying like Silicon Valley is coming for banking I'm curious whether this is the moment where you now see the big tech guys coming after banking world is banking next and how you prepare for it who would have thought that Amazon we're going to movies so I'm not sure this is a bigger difference he was always selling goods ain't anything Jeff does is interesting and exciting a good friend of mine I think he's bring in so I to me there's a natural thing cuz it's a huge part of sales and it's a huge part what they want to get you know with that our timeframe of three hour time transom tech has always been a huge part of bank right we've been using tech for years to drive down cause digitize more and more data of course it's faster it's more money being thrown at more Silicon Valley in a good way I'm in favor of global competition I think it's called capitalism but they want to disrupt and do things they also very good at straight through processing reduce the pain points you know sometimes I make fun that banks we're pretty good at increasing your pain points would you look at something like Amazon has said that they did about a 1 billion dollars in small business loans in the last year obviously that small potatoes compared to JPMorgan but it shows that they are doing more and more in this really for you it's just take more competition is good competition I don't you know I'm in favor of competition I mean favorite people trying to disrupt them in favor of all types you know they they have data on merchants that we don't have the rather small merchants the rather short-term loans and they can charge the rates they'd have a hard time charging so they have a competitive niche that they can do and compete I think it's a good thing so you know that type of stuff forces do a better job for our clients and we have to use that to be better and we do we do that with digital we got online mobile bill pay or moving money around the world when you look at the regulatory environment obviously big changes seem to be coming you have the house just recently passed the Choice Act the Treasury Department released its first report saying how the financial system needs to be regulated a lot of the language seems to come from your letter to shareholders do you see regulation as being a moat for you to that is that a protective level saying that people can't catch up - is it a problem how do you view regulation you know is it's a little bit of Bo so first of the regulations need to be looked at and for me to make rational but I've always agreed that they hurt small banks more than bigger banks so when you look at the state of regulatory reform are you feeling good about what's coming down the road do you think that that Washington is going in the right direction yeah I think that treasurer's report had a long list of things that should be looked at I look we are not here saying throw out dodd-frank not he'd go back to the good old times might over forming mortgage they say they just want to go back to bills I'm not talked about going back to subprime I'm talking about going back to it's okay to lend to a first-time buyer who has a little more risk you know and that the person you're hurting is the first-time buyer the person hurt by the by the restriction of mortgage credit were young people immigrant self employed prior defaults it wasn't JP Morgan so when you look at this too many people argue oh the bank's just won for themselves I think if we hurt them like we hurt our citizens I think our rules regulation for its small business formation or lack of ability to get permits or infrastructure and jobs so I can go on and on about the things we've done to hurt ourselves and this is just part of getting it right just anything every time your regulation it's got to be calibrated right okay so I agree when people in Washington say we need to do this of course we want to save her system okay and so they just let's just calibrate just say more more MORE isn't sufficient so do you think get involved in this do you go out to Washington and meet with of course and and are you saying don't remove everything you know Volkl rule let's keep that in place let's work with the edges so the choice act won't affect us at all because it's an or amp which the big banks won't be able to do for a whole bunch of different reasons not I'm sure they should because there are you do want to regulate big banks differently than small banks and just rationally so and uh and of course we go down there all the time and you know I just want to see the rational things done I tell people think of us as a Klesko or a Walmart you know we have huge flows we want to offer clients execution research price so you have inventories constantly turning there's risk in that but it's very tightly managed but in freeing dodd-frank couldn't you take a lot more risk yes and you did take a lot but that's a I boot in safe rank I what I'm saying is that one piece but how you define market making is it would stop some people from making active risk I don't think I'll affect that it us that much if you get changed that I don't think it affect us that much but it'll just be a great sire we reduce costs because a huge reporting requirements around it and if you're a trader you know you don't you don't think you're gonna it's gonna be got you all the time you know I made a joke years ago I'm gonna be a trader you have to have a you have to have a doctor a lawyer compliance or looking at every trade and we just overdid it if you actually went through the detail you looked at say my god that's overdone one market where you have been doing it is Detroit you've been really focused on trying to revitalize Detroit you'll put 150 million dollars you know to Detroit by the end of 2019 and a lot of the focus is on funding small business minority-owned small business would you've been there for a number of years now what have you seen that works or that has surprised you in terms of getting these small business off the ground are helping smaller agencies be able to fund the growth you know Detroit was an example of come an accident it actually might happen that happened and went bankrupt in 2014 or so but it had a mayor you know and a governor who were instead of being ideologic Republican Democrat that's fixed a life sanitation please create jobs affordable housing we sent teams of people up to say what can we do to help and one of them was as entrepreneurs fund for people of color and it's great we I know them myself there's like 20 or 30 in the room but you need bonds and he capital he needed buy inventory so this fund has been doing great it's a very exciting thing to do the population Detroit people don't fully understand this went from 2 million to 7,000 over like 30 years how do you how's the city pays taxes and maintain the roads and and the police and the Sanitation the housing the schooling so the population it seems like to grow again you go to downtown you it was I mean it was dark and you would have walked around there and now there are lights music restaurants it's turning how often do you go oh I probably been I go two or three times here so are there examples of things that have started in Detroit and that you've then taken we're doing work skills in South Bronx you know and so we're doing it we're doing these things everywhere we're doing something called the fellowship initiative that we take kids who we think are gonna have to have a hard time graduating high school so these are black males who have the worst dropout rates and stuff like that we give them Mentors summer jobs SAT training how to fill an application for schools we put I think put 100-plus through 100 gone to college including places I think like Princeton Harvard okay I went from one in LA rias and the parents are there there were tears in almost everyone's eye that these kids these kids can go back to their own communities and we're gonna double that program we're gonna be announcing one I think soon in Dallas and Chicago and so yeah when we find things at work we just roll in training veterans going in the South Bronx teaching skills are these areas the government should be playing is this JP Morgan's role to be involved yeah yes because I think I've never had a conflict in shareholder value customer or employee and community you know we have to do all those things right so we are gonna do this and help the communities amend this company's been doing it for almost 200 years now but you are pointing out that sometimes you're making up the failed government policy schools should be working better on their own but as you do this it informs you how you can improve that so there are ways that we do go back to government and we say we need to change these things these governmental listening them today and do they have the resources to be able to pull it off or do they see you as we don't have to deal with the now JP Morgan is gonna come in I think one lesson is the local level they are dying to do it so mayors and governors who are willing to say okay I'll get the schooling system to do this we'll do that you do this if you get those forces aligned we're on if some of them you know go back to bureaucratic you can't teach our teachers and I could change the curriculum we're not in at all we're not throwing good money after bad and is one of the lessons local government wants to do it the fellow would come and can play a role but so many things had to be done locally and if you've never party have you done well don't work the economy is changing so fast and buffeted it at the annual meeting said he did a kind of a thought experiment where he said it's possible the geico could run with only a third of the number of people that we have and Walmart's annual meeting they said the same thing we might have you know they might have reached peak employees when you look at you have so so much knowledge of AI you're investing in things you see where the future is going in terms of programs replacing people how big or small could JP Morgan be and then also what does it mean for the economy I think people are massively over reacting to this okay because you because it said the same thing we had 20 million people in the farm so my god with his equipment and stuff and you know product is gonna go away when it go down and we're gonna got a million people my god well you know we did and it was okay the economy is a massive thing that's constantly adjusting technologies the best that ever have the mankind we'd be living in tent and hunting Buffalo and dying in thirty fiber for technology we work five days a week as opposed to being afraid of for a live seven days a week I think I always make a joke in Europe that they're already down to four days a week mankind will adjust the case that don't stop technology but it's okay to acknowledge it has some downsides so technology and trade so it hurts so we all benefit you know everything you buy is cheaper is made here but but it's amazing some of the countries that are the best of manufacturing but also the best of robotics South Korea Japan they're booming in this in that area so I think it's a mistake to say technology let's acknowledge II do his job we collectively have to do it Society CEOs government schools and do a better job what do you do when it disrupts you as an individual or that town or that industry I think you know to me I know we know we should do income assistance retraining relocation in a comprehensive way and it works but we haven't done it so our interest you know we don't teach enough skills anymore and all these jobs are better so I did the thought experiment if you could eliminate eight million driver jobs immediately what would you do I say that you wouldn't allow it you'd say you know what let's do it over four or five years let's go to every trucking company I mean taxi company everything and teach them how to retrain relocate give incentive you know income assistance but there are great jobs out there there's a school right across here that teaches people how to maintain small aircraft every kid that's high school they'll graduate sixty-five thousand dollars a year there's machine tooling nursing radiology sales jobs there's an automotive school in the South Bronx high school and you know maintain an automobile now is computers basically all the kids graduate forty five thousand dollars a year there quickly to 70 or 80 so there are solutions so stopping technology is the bad one the good one is the retraining income assistance and I eat also support the Earned Income Tax Credit which pays people to work when make you seven eight nine dollars an hour gives them more of a living wage I would like double that program so the people have the dignity of a job the first job leads to a second job when people work they want to continue working it'll it'll be better for society everyone's involved it's better for household formation they'll help solve you know some of these society ills so I think Society has solutions they were wealthy enough nation to do the ones that really work for everybody and I think we've done a particularly bad job taking care of those left behind and I say we I mean leadership collectively unions politics CEOs schools we didn't fix some of the problems we had and those people were suffering you know they basically have let us know at this point I think the question is is this gonna happen so fast that people will lose their jobs and not be able to take the skills training I think if it does we should we should come up with ways to let it happen maybe slow it down a little bit but don't stop it don't micromanage it it's not gonna work how do you slow it down well just that government can say you can't lay off for you people more you're gonna live with you can do so many a year you can do so many things we will come over programs that actually fix it so and business is a pretty resilient businesses change all the time in society changes those these things build as these things shrink these things grow up those people are not doing this go do something else that's been all of society remember hearing that agriculture will have no more productivity increases you got the big machines you got all the stuff it's still been one percent a year for last twenty years or something now you know now they water you know by the yard the the seeds are better the machines are better the satellites are better the everything they takes place is better so productivity is a good thing and it just frees up human to mr. do other things so five years out how big or small is JPMorgan Oh hopefully bigger we actually have less sales and traders for example but more engineers more coders you know as we can do some of these things we go to more countries so these things give us an opportunity to take our research do something else with them so I'm not worried at all about JPMorgan that it's that extent bigger in terms of reach in terms of revenue in terms of profit but maybe smaller in terms of the total number of people required I like that we're using bots today it's not gonna stop as some opening retail branches you know so it's not gonna stop it's very private bankers or any investment bankers and countries in Africa or not in so to me we got all these growth opportunities and yeah we're always finding ways to be more efficient but creating more efficiency creates capital that creates other opportunities but to me I'm not worried about that my guess is our headcount will go up over next 20 years not down

Channel: LinkedIn News

Views: 31,449

Keywords: LinkedIn, LinkedIn Video, LinkedIn Editorial, This is Working, Conversations With, Jamie Dimon, Daniel Roth, Business Advice, Career Advice, Chase Bank, JPMorgan, JPMorgan Chase Bank, Chase Bank CEO

Id: CD58agCdh6M

Length: 14min 49sec (889 seconds)

Published: Tue Mar 10 2020