Jamie Dimon, Chairman, President, and CEO of JPMorgan Chase

Speaker 0:00 [upbeat music]

Speaker 0:06 So Jamie, welcome, and thank you very much for coming here today.

Jamie Dimon 0:09 Pleasure to be here. Thank you, everybody. I notice a lot of other folks here I didn't expect to be here, so, uh, welcome friends from, uh, other places, um.

Speaker 0:18 So this is the third time you've come to talk to us, and I have to ask, are we just very lucky to have you, or is there some perhaps some latent regret in choosing our competitor on the East Coast for your own business school?

Speaker 0:27 [laughs]

Jamie Dimon 0:28 [laughs] So my, uh, my wife went to Harvard Business School, I went to Harvard Business School, my daughter went to Harvard Business School, and two son-in-laws went to Harvard Business School, but we love Stanford.

Speaker 0:36 [laughs]

Jamie Dimon 0:37 Like, uh [laughs]

Speaker 0:38 [laughs]

Jamie Dimon 0:39 Like to come out here all the time. When I come out here, I realize why you don't work so hard out here. Uh, but-

Speaker 0:44 [laughs]

Jamie Dimon 0:47 Yeah.

Speaker 0:47 Now, speaking of business school, um, we have many people in the room who are trying to decide between entrepreneurship and more traditional paths on leaving.

Jamie Dimon 0:54 Yeah.

Speaker 0:54 Do you mind talking to the decision you made on leaving Harvard yourself?

Jamie Dimon 0:57 Yeah.

Speaker 0:58 And if you'd do the same thing today.

Jamie Dimon 1:00 So I, when I, uh, I'd worked at a small, really second-rate consulting company before business school. Back then, they had this thing called deferred admit, so I'd admitted, but I had to work for two years, and I thought... And, you know, I did the consulting thing. You learn a lot. I also learned I didn't want to be a consultant. And, uh, and by wor- I saw a whole bunch of different companies and industries and including badly run political, uh, all these various things. So it was actually a very good experience. Uh, but when I got, uh, when I got to Harvard Business School, I actually worked at Goldman Sachs the summer of, uh, '81. Uh, and I was headed back to Goldman, Morgan and Lehman. I was probably gonna decide Goldman, and at the last minute, Sandy Weill offered me a job to be his assistant. He had just sold Shearson, uh, which is a brokerage firm with, uh, a couple thousand brokers, to American Express. And it just, it looked like it was just too good to not, to see a large corporation from the inside, how it goes. My goal in life was to, you know, be part of an organization. It wasn't necessarily to be an investment banker or a trader or something like that. So, uh, I took the crap shoot. I figured worst comes to worst, I can go back to Wall Street, so I didn't feel like I was, you know, gonna lose anything but time, um. And yes, I'd make the same decision again. Maybe not for the same guy again, but the same decision.

Speaker 2:10 [laughs]

Speaker 2:12 Now, Sandy Weill obviously saw something in you at the time. When you meet men and women our age at JP Morgan today, what leadership characteristics are you looking for in them, and how do you identify and bring those people through as the next generation?

Jamie Dimon 2:23 Right. Well, when you're young, it's hard to say leadership characteristics, but, uh, so I mean, there's so, just some basic stuff. You know, they're people, uh, who know a lot. You know, so there's some people walk into your office and say, "Yeah, I'd like to know about the strategy of the company," and they didn't bother to read the chairman's letter that I wrote, which is, like, 30 or 40 pages long. There are people walk in and say, "You know, you really should be thinking about doing better digital services," but they didn't look at the ones we do do. There are the other people walk in, and they know everything. And so when they have a conversation, they're actually enhancing your life as opposed to the other way around. So, you know, character is a s- is a, is a sine qua non, and by character, I also mean that they tell the whole truth and nothing but the truth. They don't shape the truth, and they say the same thing to you that they say to you. 'Cause the second I see people doing something different than that, y- you just go on a list to me of j- I have no interest. I don't have time for that, and I, and I won't have interest in it. So, uh, uh, and people who are good, you know, relate well to people, so, um, so a variety of things.

Speaker 3:20 And I think when we, when we look at financiers, often people concentrate on the competitive leadership characteristics they see there. At the GSB, we have a real focus on the collaborative. How do you see the balance between competitive and collaborative throughout your career?

Jamie Dimon 3:32 Competitive inside a company?

Speaker 3:33 Inside and out.

Jamie Dimon 3:34 Well, look, I think the, the things that destroy companies, folks, are bureaucracy and politics. And, you know, so, and, you know, I, we had an offsite this summer. I'd, I was asking it many times. Like, you know, we gotta make this simpler. We gotta make this better. You know, we gotta kill, our meetings are too long or... And we, we stand behind regulations sometimes. The regulators make us do it. But I said, "No, we're gonna reimagine all these things the way they should be, not the way they are today, and, and let's take a crack at killing some of this bureaucracy that's grown up recently." And, uh [laughs] someone wrote a memo for, and we, we all do pre-reads. In my meetings, you don't flip through a chart. It's all pre-reads. I expect you to do your homework, get the analysis, and, uh, and partner it up with people beforehand. So you don't walk in and say, "Well, I, I wanna do A, B, and C, but I haven't spoken to this person yet." I would say, "Why do you speak to this person? The meeting is canceled. Go do that first and then come back with a joint recommendation or that you disagree, and then we'll talk about h- specifically why you disagree about something." Anyway, I'd asked about bureaucracy and the pre-read started by saying, "Bureaucracy is a necessary condition and output of complex businesses operating in complex global environments." It's just not true. Okay? Bureaucracy kills. Bureaucracy drives out good people. It drives out innovation. It makes the person in the office next to you a competitor and not a collaborator, and that's a really bad idea inside a company. You know, it's okay to compete with ideas, but it's a really bad idea when you're competing with the person next to you. It creates politics, and if you look at what's killed companies over the years, it was bureaucracy. And if you look at the Fortune, you know, 500, and you did a 1950, 1960, 1970, 1980, look at the companies who failed. It was because they were dumb, bureaucratic, backward, and political. And CEOs should never allow that stuff, and yet they do. I mean, as a nor- normal course, they allow it, and you've seen a lot of public companies and boards allow, boards can create it, by the way. So, uh, uh, so yeah, absolute collaboration, but collaboration does not mean everyone has to agree. Collaboration does not mean you go along to get along, 'cause that's very often what people mean by it. You know, he's a good guy, and basically he's just, you know... If you walk into me and say, "I'm gonna be loyal to you," I would question what that means, because you should be loyal to the institution. You should be loyal to the customers. You can be loyal to the principles for which I stand, but being loyal to me usually means you're gonna defend my decision whether or not you agree, and which I, I just think is a mistake.

Speaker 5:48 You're well known for having a very candid and open, forthright style of communication. Uh, it's appreciated by Warren Buffett, who says he loves your chairman letters-

Jamie Dimon 5:54 [laughs]

Speaker 5:55 ... and we obviously appreciate it here. What was it that led you to develop this style of communication early on?

Jamie Dimon 6:01 Well, I'm, I'm one of those who, I don't think I've changed much since I've been eight.

Speaker 6:04 [laughs]

Jamie Dimon 6:05 And, you know, when I got to, when I got to Harvard Business School, some of the advice I got when I was graduating was, "Whatever you do, Jamie, don't go into corporate America. You won't survive." And, uh, and obviously, and by the, there was truth to that. You know, y- I was a little too outspoken and, you know, for some corporations, et cetera, and, uh, you know, part of it was Warren Buffett. So I read, when I was in high school or college, I actually read his partnership letters, and they were, and he would say, "I'll speak to you as if you're my smart sister who doesn't know everything I know, so I have to go out of my way to explain it to you. And, you know, business is not that complicated. We should be able to explain it." So I always felt exactly the same way. I always felt, uh, uh, uh, as a matter of principle inside a company, if I allow spinning to the public, you are gonna spin to me, and think of, you know, earnings, numbers, you know, how great we're doing when we're not. And so I say the same thing to you that I say to my board, that I say to my shareholder, that I say to my employee, that I say to my customer. There is no difference. I might phrase it differently, because you're talking to a different group of people, and you're trying to explain yourself, but there is no difference. And that, and that clarity, I think, helps a company know what it's trying to accomplish all the time, and, uh, um, you know, I'm, when I read annual letters and there's all gobblygoop in the letter, I, my, my respect for the company drops a little bit. You know, and, and then, and then you gotta be very specific, because we can all say, well, the customer is the most important thing, and the customer, the customer. No, but it, you know what it should mean? It m- should mean something specific, like, do you actually read customer complaints? And then do you do something about it? As opposed to, we put the customer first. A lot of people say that, and they don't mean it in any way, shape, or form. They do no actions that would actually support the statement.

Speaker 7:43 So this one, I'm afraid I'm gonna try and sneak in some more career advice. Um, I think everyone here is aware that tech is extremely sexy right now. What do you think is the opportunity-

Jamie Dimon 7:50 A little bit less so today.

Speaker 7:51 Well, I said today. [laughs] What do you think is the opportunity in a career in finance that some among the audience maybe aren't seeing?

Jamie Dimon 7:57 So, uh, fir- you know, first of all, the one thing about tech, tech has driven, I don't think it's different than it was before, it's dri- driven change throughout all of history. You know, and it's, and all various forms of technology, from the actual, you know, from chips to internet, but also, you know, printing, you know, energy, institutions, you know, schools, uh, the churches, the dis- dissemination of morality. Uh, that's what's always changed society. And, you know, and at the, it's always at the root. It's at the root of changes in businesses. It's at the root of changes in, you know, what companies do well and what companies don't do well. So it, it is absolutely critical. I personally think Silicon Valley kind of got a free ride with Obama and the White House. You know, they, they, they pandered. You pandered to him, and he pandered to you, uh, and now you're seeing a little flip side of that. So the big companies, the successful ones, are gonna find out, which I've known a long time, the bigger you are, the more the government's gonna get inside what you do and wanna impose y- on you and set rules and standards. And sometimes for good, and sometimes not for good, but, um... So financial services, so I think technology's an absolutely wonderful thing, but financial services, first of all, we are a huge user of technology. We spend $9 billion a year, so we're, you know, we're, we're not at the bleeding edge, but we're damn close in terms of what we spend money on, what we do, our, our, our data centers, our capabilities, our mobile, our digital. Moving, you know, we move $6 trillion around the world every day, digitally. Not cryptocurrency, but close to it because-

Speaker 9:21 [laughs]

Jamie Dimon 9:21 ... because it's digital, you know? And, you know, we, we bank 50 million people in our households, and soon we're gonna have online bill p- no, I mean, uh, online investing and robo-investing, all these various things to link into our accounts. So we, we are huge users of that kind of stuff. We also obviously use the advertising of Facebook and Google, et cetera, and, uh. But financial services is always gonna be an interesting business, because it's, it's not the most important business, but it is at the nexus of, uh, of how a capitalist society functions. It's part of the spin wheel. And, um, when I say financial services, I'm talking about all of it. You know, private equity, venture capital, activists, whether you like them or not, banks, non-banks, individual investors. You know, a lot of companies that do things individually that help change the world a little bit. But that, it's always gonna be this field that where money gets invested, ideas come together, things get executed, capital gets executed globally. So it's always fascinating. It'll always be well paid. Whatever, you know, some of these folks say in DC, it has to be well paid, but you can't do it, you know, with dumb people making dumb decisions if you're thinking of actually running a good economy or something like that. Uh, it'll always be a high tech user, uh, and it'll always be complex and global by its nature, you know? And so it's a fascinating business. When you wake up in the morning, when, when I read the paper, there's very little in the paper that I'm not reading and thinking about, it affects our clients, it affects our companies, it affects our risk, it affects our exposure. We should be doing something about it. Like, just any article, because we do business in, you know, well over 100 countries, you know, uh, and with, uh, just about every country and every sovereign wealth fund. So it's a fascinating field. I mean, when you get into it, there are all different parts to it, and you gotta decide how you wanna, if you wanna get into it, how you wanna get into that. One of the things we set up which I really like is we hired top-notch people from investment banking, okay? And sales and trading. So we go to the best schools in the world, we hire some of the best people. We now do the same thing for general management, about eight or nine or 10 a year, because we need people who can run the damn joint, too. And I want the same quality, and we move them around the company, kind of keep an eye on them and, you know. But the point is, they wanna be global, they wanna move around, uh, uh, and they wanna learn how to manage and run something. So the same kind of compensation as investment bankers, same, uh, openness to senior people so that we can get that. N- and not that if you're in investment banking you can't move into management or, you know, sales and trading, but this is really people who wanna do more management in financial services.

Speaker 11:43 So you, you, you mentioned cryptocurrency. I know you said you weren't gonna talk about Bitcoin anymore.

Jamie Dimon 11:47 Yeah.

Speaker 11:47 But you're at Stanford.

Jamie Dimon 11:48 Yeah.

Speaker 11:48 Some of us put all our student loan money into it. And, uh, I have to ask you anyway. [laughs]

Jamie Dimon 11:52 [laughs]

Speaker 11:53 Why do you believe that governments and regulators can't allow the existence of a global currency based on a centralized-

Jamie Dimon 11:56 I, I've become like a, I've become like a spokesman against Bitcoin. I don't care.

Speaker 11:59 [laughs]

Jamie Dimon 12:00 I don't care about Bitcoin. I could give a shit, to tell you the truth.

Speaker 12:02 [laughs]

Jamie Dimon 12:03 I, and I, I, I promised myself I wouldn't talk about it. The next day, I started, I... [laughs] There are four things, really quickly. Blockchain is real technology. It can be public or private. It can be for five people, it can be for five million. It's gonna work. We, you already use it in a lot of test cases and stuff like that, so we're a supporter. I do worry a little bit about the security because, like I said, we move $6 trillion a day real time, quite efficiently, effectively, and secure. Before you replace that, you know, you gotta [laughs] make sure you can, you can do it right. There are three cryptocurrencies, okay? Three types, three separate types. One is ICOs. ICO, and, and I haven't studied these things, but you're, you're paying for a token that allows you to use a service, which is very different than a currency, but that's what people call cryptocurrencies, and maybe, Jim, maybe you've studied some of these ICOs. I have no idea, you know, about some are giving you cloud services or some can give you investing services. That's one type. The second type you can use cryptocurrency for fiat currency. Well, that works because it's just using different technology to move money around. You know, basically we keep your money digitally anyway, and if you just keep different files in a different way and distributed ledgers, that would work fine. But I've always thought about Bitcoin as a currency and a store value and a payment mechanism, is that governments, and this, uh, this, this is my belief, and I may be wrong. I'm not saying it can't go to $100,000, that governments are going to crush it one day for three reasons, okay? One is when it's used for terrorist activities, okay? It'll happen. It's a matter of time. It'll go back to a Bitcoin, and then all of a sudden the DOJ, the United States government, all these people in Washington who profess to love technology and, you know, novelty of Bitcoin are gonna change their mind. Number two, when a lot of little old ladies lose their money, you know, because the speculative vehicle was allowed to exist by the United States government, you know, and they're gonna lose their money, and they're gonna be pounding, "You should've done something about it." And number three is the most important. Government, when e- whenever a government forms itself, and you go to any country in the world, pull out the currency, look at the date, that fiat currency was formed by that government with the central bank because governments like to control their currency. They like to know who has it, where it's going, why it's going, when it went, et cetera. And right now, Bitcoin's a novelty. It's $100 billion, you know, and, and a billion dollars a day trades hands, obviously mostly speculation, okay? And obviously there's a real use case, I'm not making this a joke, Venezuela, Cuba, North Korea, criminal, uh, drug money. That'll always be true. So it'll always have a use case that's, uh, valuable to someone because it's better in those countries to do some- you know, to have that than have to have currency or ca- or money in a bank because the governments, they take that too. You know, if you go to Argentina, y- they had to effectively savings accounts, the government just went in and took it. They just took it. And you know, of course everyone took the money out of the bank right after that, and then the country basically collapsed. But, uh, uh, so th- tho- tho- that's the reason why, and w- it's gonna get bigger and bigger, and they're gonna wanna control it. And it's not the same as a fiat currency. A fiat currency, the government says, "You must take this as legal tender," and at par effectively cash, at par, you know, and it's always worth par. And I don't know why a crypto dollar would ever be something that, you know, a store of value would be worth than a crypto, uh, Bitcoin. So, uh, you know, that's my view, and I, you know, I may be wrong and, which I doubt, but-

Speaker 15:24 [laughs]

Jamie Dimon 15:24 [laughs] I've been wrong before though, so-

Speaker 15:26 [laughs]

Jamie Dimon 15:26 And if I'm wrong, I also don't care very much to tell you the truth.

Speaker 15:29 [laughs]

Jamie Dimon 15:29 It, it'll never affect my life. It's not because they write or the bankers are defending their stuff. That's absolutely untrue. You know, if, if Bitcoin works and we have to do something with Bitcoin, we'll do that too.

Speaker 15:39 Kind of a win-win there. Um-

Jamie Dimon 15:41 Exactly.

Speaker 15:42 [laughs]

Speaker 15:43 JPMorgan's a big investor in blockchain technology as distinct from Bitcoin. Um, what do you think the most interesting applications of blockchain are gonna be in finance?

Jamie Dimon 15:50 So the blockchain, thi- think of it as it's, it's not like a faster chip or, you know, the Nvidia GPUs and stuff like that because when you get certain te- technologies, they just filter through the whole system, and they allow you to do things differently everywhere, like just more database and, you know, more reading different natural language processing. This, you basically have to write code to have a use case for Bitcoin. So think of it as it'll be deployed use case by use case. We're using it to move money inside the bank. Something like 30 or 40% of the $6 trillion we move is just between JPMorgan Chase accounts, okay? I saw Mary here. You know, from General Motors to one of your vendors, and we have both the accounts. We just move it between our own accounts, you know, basically. W- loans, okay, loan, you know, a loan document due to trade, all the paperwork, all the detail, and all this limitation, and all the, you know, all the covenants, and all that can be kept in a place where you all have the same files. They're all kept up to date. You know who owns it, you know who doesn't own it. Um, that, so that'll be one. Equity trading, I don't know. The Bitcoin takes 10 minutes to finish. You know, we do thousands and thousands of trades in split seconds in equities. So it may be too late to use for equity trade. It may be okay for end-of-day settlement stuff. So it, it's all just use case by use case. You can go through one by one and say, "It'll work here, it may not work there," and, uh, but a- again, you gotta kinda write the code, re- or effectively rewrite the code.

Speaker 17:11 So we're gonna move from one hot topic to another. You were part of President Trump's business advisory board. Should it have been disbanded, and where is that dialogue with the administration now taking place?

Jamie Dimon 17:19 Yeah, so, um, so I, I joined the council... Now just, uh, keep in mind, so when I joined the council, the president asked, you know, Steve Schwarzman called up actually and said, "The president would like you to join his council." I am a patriot. I love the United States of America, okay? And it's very, you want to help your country, and I still am gonna help my country, so help me God. That's what I'm gonna do, whether or not you all like President Trump. And, and, you know, remember, we help presidents and prime ministers all around the world. I see them, we advise them, we give them this, and we want to help the people of that country too, and that is part of your job is, you know, as a bank and as an individual to try to help make the world a better place. I joined the council. I did get one very long, well-written, elegant, nasty letter from my daughter, like basically-

Speaker 18:06 [laughs]

Jamie Dimon 18:07 ... basically saying, "How could you, Dad?" And my other two daughters were right to the point, "Ditto." Uh-

Speaker 18:12 [laughs]

Jamie Dimon 18:13 And my wife told me how many of her friends she had to explain it to. But m- remember, these are all liberal effete New Yorkers, in my opinion.

Speaker 18:20 [laughs]

Jamie Dimon 18:21 Uh, uh, I said, "I'm a patriot. Doesn't mean I agree with everything the man says or the way the man is himself. It's about trying to help the United States of America." The council met twice, so think of these councils. The truth is, they aren't particularly effective. You know, the... I was at one. I don't know if Mary was at the second meeting. Uh, and I think the second one's a lot like the first. You know, you, you know, you talk about the infrastructure, you talk about this, and the President is like, "That's ridiculous. We can get better at this." All true, but at one point, that work's got to be done in detail in the agencies, okay? Not by a bunch of CEOs sitting around the table, you know, telling you that, you know, it takes too long to build a bridge and this regulation hurts, and we need this in capital markets. So the effectiveness comes down over time, and then after, you know, Charlottesville was the last straw, but the negatives were going up. You know, most of us really believe in diversity, LGBT, DACA programs. We're pro-immigrant. We're, you know, and we certainly wouldn't justify in any way, shape, or form, you know, Nazism or, or white supremacy and stuff like that. So, you know, we found ourselves having to explain to our own people, by the way, because the press was always calling me up and saying, "You should say something." I don't remember the press calling me up and saying I have to go public every time I disagreed with something Obama did. So the, the press really is extremely biased, and they, they're gonna have to do something about it. N- not all, I mean, they're all biased in their own way. Uh, but, you know, having to explain it constantly over and over was just a negative. We had a conference call. Steve Schwarzman was the chairman. He ran it. We went alphabetically. Everyone on the conference call said, "Let's just disband it." There were two who said, "Don't. Having a seat at the table is a good thing," et cetera, et cetera. And, and we disbanded it. Of course, Schwarzman told the President, and the thing that came out was that the President agreed to disband it. You know, which it wasn't exactly the case, but, uh, but, but, but everyone in that room is still working with the people they should be working with to help the United States government do proper things. They need help. If you think somehow things, decisions are gonna be made properly in Washington without the help of business, they won't. And so we're all doing it in our own way, and obviously I deal a lot with Mnuchin and Cohn, and, you know, other people deal with the other, the other agencies, et cetera. But it's incumbent upon you to try to help. And, you know, to, to, just because you don't like a president is a really bad idea. I think we've become far too knee-jerk in our politics, and, and, uh, you know, to me, you should be willing to help.

Speaker 20:36 Your name was-

Jamie Dimon 20:36 So-

Speaker 20:37 Oh, sorry.

Jamie Dimon 20:37 Yeah. Yeah. Go on, I'm sorry. Go ahead.

Speaker 20:39 Your, your name was thrown around a lot, uh, as a potential Secretary of Treasury. That didn't happen. But say you wake up tomorrow as the Secretary, what does tax reform or economic policy look like under Secretary Dimon?

Jamie Dimon 20:49 Yeah, so, uh, I don't want to be Secretary of Treasury.

Speaker 20:51 [laughs]

Jamie Dimon 20:52 Uh, but, but we, we have... You know, I tell people this is important. This country has the best hand ever dealt of any country on the planet, and most people don't fully understand it, because they never make the list. So I always say, when you have a problem, make a list, and go through what really matters. And I'll, I'm gonna do this quickly. We have all the food, water, and energy we need. We have the Atlantic and the Pacific, which, you know, our Founding Fathers realized how powerful that is to defend this country from wars in Asia or wars in Europe. We have the best military the world's ever seen. That's gonna be true for a long period of time. Um, and, you know, I c- I say compare us to China, but do it respectfully. China does not have the food, water, and energy, okay? And its neighbors happen to be Philippines, Japan, North Korea, South Korea, Indonesia, Vietnam, Pakistan, Afghanistan, India, and Russia, and they've had border skirmishes or wars with like five or six of those in the last 40 years. They are in a tough part of the world. So they, those leadership there, they're saying, "God, we need food. We need access to, uh, uh, certain commodities. We need, uh, we g- we have to have an army just to protect ourselves" from the billions of people that surround them that aren't that ha- necessarily that happy with them. So the United States also has, and, and I go to business school, they're talking about Japan, Japan, Japan, Japan, Japan, Japan. And now, then it was BRICS, Brazil, Russia, India, China. Then it was Mexico, Ind- the MIST, Mexico, Indonesia, South Africa, Turkey. But none of them have what I'm about to say, the universities we do, the rule of law like we do, low corruption like we do, the widest, deepest, most transparent financial market the world's ever seen, public and private. Again, and I'm not talking about banks here, okay? And, uh, uh, the, uh, hugely vibrant businesses, small to large, and innovation like the world's never seen. And I'm not talking about just Silicon Valley. I'm talking about, you go to any company in America, and believe me, they're getting productivity up 2% somewhere, okay? And, you know, we, uh... Now, does Brazil have that? India? China? Okay? Does, does most European countries have that whole list? Does Mexico have it? Indon- I mean, so people don't... That, that's the best hand. But something went wrong, and, and I do think we left behind a huge s- uh, segment of society. 10 million people left the workforce, which I think they're starting to come back in. 20 million people are felons, of which a l- a, a, a large amount shouldn't be felons. You know? I tell people, you know, "If you were all caught doing some of the shit you did, you'd be a felon, too." And, and you can't get a job after that, or at least, you know, most companies, you're not gonna get a job at JPMorgan by law for most of the jobs we, you know, we... By regulatory rules and requirements, okay? We have the opioid crisis. We have, uh, we did... There are some... I think we blame trade and immigration and technology, but that's not really the reason, but we have the, some of these Rust Belt towns we left behind. Our, our inner city school kids, 50% don't graduate, okay? And most of you didn't go to inner city school, but 50% don't graduate. They're mostly poor. They're mostly minorities in this land of opportunity. There are six million open jobs today, good jobs, that, that you can get out of high school, welding, construction, uh, electrical, uh, coding, automotive. There are, you know, automotive jobs everywhere, uh, aviation, and are, we're not training the kids. And, you know, so that's why, and that's also why I took on the Chairman of the Business Roundtable. So the, the question I always have is, how do you fix that stuff? And in reality, I think the fix is actually known. I think the hard part is getting it through Congress. But, you know, co- competitive tax reform has to be done. We, and I, and I... It shocks me that my Democratic friends, they s- and they, they say, "Are you gonna change wages on day one of the to- corporate tax reform?" That's their measure. What happened last time? That's their measure. The measure you should have is the counterfactual. Had you had competitive tax system 10 years ago, there would have probably been $3 trillion retained here. Companies and capital. 5,000 companies have been bought by foreign companies because it's advantageous for them to own an American company now. So while our government dawdled on these inversions, 5,000 companies were acquired by foreign companies net, there's a study that came out by E&Y, that would've been retained here. C- think of corporate headquarters. And, you know, we damaged ourselves, and it's permanent, and that 4 trillion overseas, and it's 4 trillion, some has been reinvested in hard, you know, hard equipment and plant and companies, but there's still two and a half trillion in cash. That's why it's there. It's not because these companies are immoral, it's because it's so much more advantageous to do stuff over there. Microsoft built a research center in Vancouver because they can't hire the same kids in Seattle, because of our immigration laws. And so, you know, these things have held back America, and I am absolutely convinced, and this i- it's hard to prove it because you can't put a model, we're growing at 2% in spite of the dumb things government's done for 10 years. And had we done the right things around competitive taxes, infrastructure, education, we'd be growing at 3% or more. This recovery, the growth is half of a normal recovery. B- uh, small business formation is, we're down net, uh, millions of small companies that normally would've been formed and the reason is lack of access to credit, regulations. And again, I can't prove it. I'm trying. I'm alr- u- using big data now trying to get some of the stuff looking backwards. And that's what th- so, uh, the, part of the agenda of the Trump administration is the right stuff. Infrastructure, education, competitive tax reform, proper re- proper regulation. And I just say proper as opposed to less or more. You know, they, they massively overdid it. You've heard people say that it didn't hold back lending, okay? And we did some, and this was real, real analysis, and done by economists, not by me. Mortgages alone, we believe, are held back by $1 to $2 trillion because of the cost, lack of securitization, lack of servicing requirements, uh, and, and because of litigation and stuff around it, that people are, mostly the mortgage underwriters, are unwilling to make mortgages, uh, to first time buyers, young people, immigrants, prior defaults, and self-employed. Not going back to the subprime of the old age, just open up the credit box a little bit, okay? $2 trillion in mortgages would've been probably 5% growth in GDP. That one thing. And yet they say it didn't hold back lending. And I... And by the way, that would've not changed any risk at all for banks. We don't, for the most part, we don't keep that stuff. And it wouldn't have changed the risk for the government or the... Actually, I think the risk is lower when the economy's stronger. And, uh, so th- that's why, that's what they should be doing. I think they are gonna do some of that stuff, I hope.

Speaker 27:02 Under your, uh, management, JP Morgan's, you know, gone from strength to strength. But one, one incident stands out as a, as a negative during your tenure. So the, in tw- 2012, a London-based trader lost over $6 billion-

Jamie Dimon 27:12 Yeah

Speaker 27:13 ... for the bank. Are there any lessons for us all in how you dealt with that incident? And do you, do you wish you'd done anything differently?

Jamie Dimon 27:18 You know, here, here's a [laughs] example. I mean, th- this is what our country's come to, okay? We, we had a record profit that year. We're a big company, hugely embarrassed. I'll tell you about that mistake in a second. No customers were involved, okay? It was originally put on as a hedge, that obviously didn't work, okay? And yet we were punished severely. And Congress, f- $2 billion of fines. I mean, it's, it's outrageous. It's ju- it's just outrageous that a company makes a mistake. My shareholders got hurt by 6 billion. I hurt my shareholders. I apologized to my shareholders. And the government fines me 2 billion in addition to that, because they can. Because they said it's another example of a bank being mismanaged, et cetera. You know, shit happens and, uh, and, and it was-

Speaker 28:01 [laughs]

Jamie Dimon 28:02 It was, it was, we had put on a hedge that was supposed to earn a lot of money in a recession and basically break even in a normal thing, and lose money in a booming environment. Think it was, think as we were short, high yield and long investment grade, something like that. And it wasn't the complex derivatives that mattered, because the fact is that wasn't the mistake. The mistake was when we s- when we put this thing on, I thought, and I'm, uh, again, I blame myself and I went public right away, big mistake, 2 billion, could be a lot worse, bad strategy, barely vetted, barely monitored, barely done, my fault, I'm sorry, we're gonna fix it. You know? And, you know, the details, uh, in some ways didn't matter, but, uh, but we d- it was, it was hugely liquid, this typical thing in trading, by the way. When I, we had asked them to reduce the positions in ha- I had asked. I'd looked at some very simple numbers, risk weight asked, I should have asked a couple more questions. They couldn't do it. So instead of like reduce it in half and saying, uh, uh, we have a problem. But if they'd said that at that point in time, we would've lost 500 million, you probably wouldn't even have known about it. But instead of that, they kind of doubled down. They tried to come up with these old cockamamie ways to reduce the risk, but they just added more and more illiquid positions on top of other liquid positions. And when you try to unwind that thing, that's how you get killed. And so, but the lesson, there was no lesson to me. I knew the second it happened. I've seen it before. I got the whole management team again, all the PR people. I said, "Guys, they're gonna come after us. J- we're, they're gonna say, 'Jamie was like everybody else. You know, big banks are too big to manage. Jamie Dimon's a failure just like these other guys. He's off his high holy horse. Diamonds do break. Dimon in the rough.'" I wrote all the headlines.

Speaker 29:34 [laughs]

Speaker 29:34 [laughs]

Speaker 29:35 [laughs]

Jamie Dimon 29:35 I said, I said, "Forget all of that stuff. We're here to serve companies, serve clients. We're gonna do our jobs. And hopefully the attack by the..." And when that, something like that happens, and a lot of you have been through this, that is a letter to every AG, to every newspaper, to every senator, to every congressman, and they all attack. Like, like literally like a bunch of barking hyenas. And, and, and yet we all look at it like that's okay. But it's not okay. It's not the way, uh, professionals, people should act when companies have problems and stuff like that. So, you know, the, so the fact is there was no great lesson learned other than for all of you, whenever you have a problem, and I'd say, you know, Zuckerberg's got one, that's what he's gonna deal with. And I'm not sure he completely understands that. Every AG, every senator, every congressman, they'll turn immediately, they'll go on the attack, they'll take advantage of it. I mean, I'm surprised they're not talking about fining them billions of dollars yet. And so, you know, that, and that's what society is. You just, you just have to learn how to deal with that stuff. So, uh, um- And the, and the b- the biggest risk of all, the, uh, uh, the risk committee, so we obviously bear risk all around the world. That risk committee, which was meeting, ha- had our senior risk officer on it, when I asked, "What, what about this trade?" They said, "Oh, no, that trade was done pretty much between the, the, the bunch of those traders who were doing it, and Ina Drew, who was our CIO," who I respect. They didn't want to take, they didn't want to share the risk committee. That should never happen, ever, ever, ever, ever. Okay, our risk committee see everything. My general counsel sees everything. My head of compliance sees everything. Once someone ever says, "Well, w- that, we're gonna do over here," you got a problem. You know? Then, and that, that tends to c- create a issue that will come back and haunt you.

Speaker 31:14 To explore leadership in tough situations some more, the, uh, Harvey Weinstein story is very much on people's minds at the moment. As a leader, what do you feel is your role to play in creating a work culture that's very respectful of women?

Jamie Dimon 31:23 Well, I, I think it is your role to do that. And, uh, uh, you know, and someone [laughs] said to me about that Harvey Weinstein, so this, well, you know, Wall Street's been that way. Wall Street's not that way today, folks. Not, not like that stuff. I mean, I'm sure there may be harassment somewhere in JPMorgan, but if you think it's condoned by anyone at the company in a senior position, absolutely not. Okay? And, and we've got, you know, f- strict processes in place to, to look at what people do and how they do it and review it. And if it involved me in any way, shape, or form, it would go directly to a separate board thing. It wouldn't be like, you know, uh, I can go negotiate a settlement on my own or something like that. So the, the first thing to, uh, uh, diversity, and I think it's more important than anything else, is that everyone in the company is treated with trust and respect. Any meeting you walk in, you feel like you're welcome, anyone can speak up. It's not a guys... And you see, you know, you see the subtle guys thing. I've seen this. A senior banker once told me, "Jamie, watch this man who runs a big part of the company walk into the partners' room, and he'll walk up to you, 'Hey, buddy. How's, like, the football game?' You know, 'Hey, man, what was your score in golf?' And he won't even talk to the women in the room." Y- you know, if you're managing a group of people and I saw you do that, you'd, you'd get a earful from me. You gotta talk to everyone. You can like some people more than others, but you gotta talk to everyone. And you have to go out of your way to get the quiet person, the reserved person, the person who d- you know, doesn't wanna be embarrassed, to get them to speak up and feel comfortable. And, and when you have an environment of trust and respect, people can shine, okay? Now, you should have specialized programs and all that, and I'm for those, but they don't work if you don't create that environment. Doesn't matter. And, you know, and I, you know, just like you would advise my, my three... I have three daughters. If they were in a terrible environment, tell them, "Leave. Go find a place that appreciates your skills." You know? And, and so it will hurt a company ultimately because, you know, if I get to pick my team from all people, not just white men, I, [laughs] I would pick a far better team. And I should point out that at JPMorgan Chase, and I, again, the press doesn't write this, half of my direct reports are women. Did you hear what I just said? Every article, even in the Wall Street Journal, is always saying it'll be 30 years before women represent 30% of the executive suite on Wall Street. 50%, including the head of tech now, you know, uh, Lori Beer, who's been doing a great job. She's been doing it a couple of months. And 20% of my direct reports, LGBT, because they're good. You know? And, and 30% of all the top 200 people in the company are women, and they run major parts of the company, credit card, uh, uh, private banking, global equity capital markets. A, an Indian woman is the head of US M&A, and that was the most macho, belt and suspenders, smoking cigar in the back room of all the jobs, you know? [laughs] And, and, you know, her father didn't even want her to go to school, college. And she's actually from India. She's not just Indian. [laughs] And so, um, so yeah, I think if you do it right, you, you'll have a great environment for everybody, and you gotta have your eyes open to it. You know, what I always worry about is not, is, you know, we have 5,000 branches, and I, you know, I just always know that in that branch, that guy or woman, but mostly a guy will, can be a bully and get away with it because we can't see it. And, you know, no matter what we say, the people in that branch feel behold... They need their job, and they put up with it. Like, another one you shouldn't allow, like, and if you've, and I'm sure you've been to companies, you should never allow, and it came to my attention, you are not allowed to have a golf event and invite the men in the d- division and not the women. It's just not allowed. I mean, my first inclination would be to fire someone on the spot if I heard about that. Like, just, just what, what... And don't have golf. Do something different, you know? And, and, uh, you know, go out of your way to make everyone feel accepted and you'll build a great company.

Speaker 35:03 One question we often ask female CEOs here is how they manage work-life balance. We rarely ask male CEOs, but I've heard a story that you once threatened to quit your first job because a partner forced you to work over the weekend unnecessarily. Uh, we're not suggesting that JPMorgan investment banking analysts stop doing the same.

Jamie Dimon 35:16 [laughs]

Speaker 35:17 Um, but do you have any tips for us on structuring our time-

Jamie Dimon 35:20 Yeah

Speaker 35:20 ... uh, balancing demands made of us-

Jamie Dimon 35:21 Yeah

Speaker 35:21 ... by our superiors?

Jamie Dimon 35:22 So anyway, when I was, uh, an analyst at this consulting company, this consultant had said, "You gotta do this work. I need it Monday morning, 9:00." Or he gave the assignment on Friday, which is what all the people in Wall Street complain about. The kids are right. The m- MDs, they come in, partners, and it's, they, they're not thinking about until Friday, then Friday it's, "I need this. I need it Monday," which means you gotta work all weekend. And most of the time you could've gotten the assignment on Tuesday. And so we've actually tried to institute some policies to, like, you can't give people assignments on Friday basically anymore unless it's approved by someone senior. And but he, I worked all weekend, and then, uh, I show up at 9:00, and it was li- you know, I was in the library basically doing, you know, research and stuff like that, and he wasn't there. And he called in at 12:00 or 1:00. I said, "Robin, I worked all weekend. You said 9:00. It was critical." He said, he said, "Oh, I didn't really need it until tomorrow. I just wanted to make sure you got it done." To which I was like [laughs]

Speaker 36:11 [laughs]

Jamie Dimon 36:12 And I, I, and I told him, "I'll never work for you again." Now, but this is not advice.

Speaker 36:17 [laughs]

Jamie Dimon 36:17 Okay? My, my advice would be a temper is not a good thing. [laughs] But I, I... And they said, "Well, you, you can't tell the, uh, consultant firm who you're gonna work for." I said, "Yes, I can, because they can fire me." I was quite serious. I never worked for the person again. And, uh, I think that was a bully thing. You know, just, and that was my instinct. That was just bullying me, and it was completely unnecessary. Uh, and he knew me well enough to know that I was gonna get done what I told him I'd get done and stuff like that. You can have work-life balance. I tell people at JPMorgan Chase, it is your job to take your mind, your body, your spirit, your soul, your friends, your family, your health. ... your job. It's not our job. So I think there's a little bit of misunderstanding that some of the companies... Now, we should do everything we can to help you. I tell people, "We give you medical, shrinks, Pilates, massages."

Speaker 37:03 [laughs]

Jamie Dimon 37:04 I mean, we, we really do try to take care of our people. But I can't make up for you not doing those other things, and you really have to do it yourself. Most people don't work very smart. So, first off, work smart. Now, I deal with emails and phone calls generally once, okay? I have three types of reading: very fast, fast, very slow. As, so, you know, so I'm, the very slow is the complex, I really need to think about. The very fast might be a magazine. I just want to see if there's anything interesting in there or something like that. And, you know, you, people don't run their lives efficiently, and I'm sure you've seen, even in school here, you know, the people frenzied. They're always frenzied. They're late. They can't get back. I'm sorry I didn't get back to you. I couldn't get this done. I got my cases. I couldn't do this. If you're frenzied, it's you. It's not the school, it's not the job, it's you. Because a lot of us aren't frenzied.

Speaker 37:50 [laughs]

Jamie Dimon 37:52 I'm, I'm, I'm not, I'm never late, almost never late. I'm not frenzied. I have a nice follow-up list. I know exactly what people are doing. Uh, I schedule time, you know, for myself for exercise, and for, you know, making my phone calls. And if I didn't do it this morning, I'd be a little, I would feel har- harried if I wasn't all caught up, you know? And, uh, uh, so work really smart. Learn how to work smart. Uh, and then in parts of your life, I think it's really difficult when you have children. That does burn the candle at both ends. My advice to men is you better drop watching every football game and playing golf on both Saturday and Sunday. You know, do something with your kids. You know, and if you don't, it's neglect. Okay, you call it whatever you want, but it's neg- I have a lot of friends who complain about they couldn't, they didn't have enough family time, but they go play golf on Saturday and Sunday. Now, playing golf on Saturday and Sunday means you wake up at 7:00 or 8:00, you go play golf for three hours, you have lunch, usually a Bloody Mary, you go home and take a nap.

Speaker 38:44 [laughs]

Jamie Dimon 38:47 Okay? And then you go to dinner with friends. You know, you should've done something with your family. And so, uh, so you can do it. And if you're a woman, I think it's even harder, you know. And I think there, there are some jobs that are really conducive to helping you, and some aren't. You know, and you gotta think that through a little bit. And one of the greatest speeches I ever saw a woman give was, "You can have it all, you just can't have it all at the same time." And just be a little thoughtful how you manage your life. And that could be a man who's got to stay home to take care of kids or sick parents or something like that. And, uh, so it's a long race, and you, you can pretty much do it all. But you, you gotta make sure you s- save time for yourself to do those things. And even the toughest job, you can do that.

Speaker 39:22 Jamie, in 2014, you continued to actively lead JPMorgan despite battling and defeating throat cancer.

Jamie Dimon 39:28 Right.

Speaker 39:28 Many people were incredibly impressed, um, by your decision to stay at the helm of the company during that time. What continues to motivate you under those circumstances?

Jamie Dimon 39:35 Well, yeah, and re- remember, it's not up to me to stay [laughs] at the helm of the company. Uh, and you're never quite over with cancer either. So, um, uh... You know, at first, I had to go public with it. You know, it wasn't my preference, but I, you know, I couldn't be seen walking in and out of, uh, uh, Sloan Kettering, and of course, I was gonna lose weight, and I didn't lose my hair, but I could have and all that. And so I just went com- com- completely clean. I did go to work, like almost every day. But that does, that does not mean I worked every day. I mean, I, I was taking four or five naps. I'd lost like 40 pounds. I, and I didn't want to get close to anyone, because your immune system is virtually gone, so I didn't want to even get a cold at that point. But, you know, I, uh, people say, "Why do you..." So I was sitting home, and, and I'd go, I'd go get my treatment every morning, radiation, and I'd go home. I would try to exercise. I went from running five miles to walking five, to like literally walking for a minute, going on the floor, because I was gonna pass out, walking a minute. But it made me feel better, but the same, out in the gym. And then I'd go... But if I stayed at home, you know, you know what I was doing? I couldn't read. It just, I thought I could read eight hours a day. I just couldn't do it. But I would stay at home. I was watching ISIS and Ebola.

Speaker 40:38 [laughs]

Jamie Dimon 40:41 And, and when I'd go to the office, I'm surrounded by friends and interesting things, and it keeps your mind... I had some meetings, you know. I, and so I just, it, it just was better for me. And, you know, the board was fully briefed the whole time, and I have an unbelievable management team, and they were great, and my family's great. And so the, so the, you know, it was a, it was an, uh, in some ways, a heartwarming experience, other than the fact that it's terrifying.

Speaker 41:04 Jamie, thank you so much. I think now we'll turn it over to the audience for Q&A.

Speaker 41:15 Thank you so much for being here, Mr. Dimon. Um, at what level do you think Bitcoin has to get to before- [laughs]

Jamie Dimon 41:22 ... uh, before JPMorgan would embrace it? And, um, at what level of demand? You said there is a level, and I'm wondering what that would be as we look today at the price of $7,000 a coin. I, I doubt we're gonna embrace it at any price. So I, I mean, to me, it's the, I'm worried about being caught up in this maelstrom of, you know, people losing money and stuff like that. There's no reason for us to do anything with Bitcoin. Now, if you, if you're a client and you want, you know, you're gonna trade it on the CME or something like that, I advise you not to do it. But should we do it and put in trades for a client who asks us to who's sophisticated and, obviously not bright, but sophisticated?

Speaker 41:57 [laughs]

Jamie Dimon 41:58 Uh, maybe, I don't know. I mean, you know, I, you know, I told the se- senior team, I don't tell them what to do. I told, because I sent a note to Daniel Pinto, who runs it. I said, "Daniel, y- I know you heard what I said. It's your job to figure out what to do. You know, and if you disagree with me, that's completely fine." I'll probably do whatever he wants, in spite of what I said. Yeah.

Speaker 42:20 Hi. Hello? Uh, hi, thanks for coming. Uh, uh, one thing, uh, I'm Puneet, I'm a, a second-year MBA. Uh, one, a couple things you said that were quite interesting were, like, there's no lesson to be learned, and I don't care if I'm wrong. And I guess from a lot of senior leaders, I've noticed that self-awareness and learning from mistakes are, uh, key characteristics. Do you agree, and if so, do you have an, a example of a time when you've actually tried to build those?

Jamie Dimon 42:44 Yeah. So I s- I did mention the mistakes I made. I should've d- asked some more questions. By, there's one question would have, I, I would've known Just one. It was the one when I said it was a tempest in a teapot. I had been told, I had asked the question, I got the wrong answer, was how liquid are the positions? How many days can you get out? I was told 10. Yeah, it was like hundreds. And the second I heard that, I said, "Oh, shit, we have a real problem." Uh, so you learn. And I actually wrote about it in my chairman's letter. I said, lessons learned or relearned. I knew that. You know, and so you kind of learn, sometimes you learn the same lessons over and over. It's like being in the boxing ring. They say, "Duck," you know, "Hold your hands up." Yeah, well, that's harder to do than you think. But, but, uh, uh, so you do learn, you do get better as you get older in management, in people, in decision making. Uh, but the b- I'll tell you what the biggest mistakes I've made are. You know, not the specific one like the London Whale, but, but m- more the patterns around it. Temper's a bad idea. Any decision made out of temper or even treating people with temper, you, you know, y- y- you, they, they're going to be careful. Why you walk in, and w- which mood is he in, and stuff like that. You don't get the best out of people. And sometimes early in my life people said, "Well, you know, it was a well-placed blow of anger." No, it wasn't. It was you just a welling up of anger. And it usually clouded your judgment as opposed to... So I knew I had finally matured when about 10 years ago, someone was sitting in front of me talking about something, about, it was about an investment banker comp, and I was getting so mad. And I said, "You know what? I'm gonna leave the room. You guys stay here for 10 minutes. I'm gonna come back." I went out, I thought about what made me mad. I came back, I told them very politely how offensive what they were saying was to me, et cetera, et cetera. And but other mistakes, when you don't get the right people involved, plain and simple. A lot of ans- sometimes the answer's waiting to be found. You just got to get the people in the room, work it. Um, making decisions when you're tired, making decisions on Friday, uh, uh, not thoroughly vetting people. The biggest mistakes you make are people mistakes. I've made plenty. The people mistakes really set back an organization because it takes a long time to figure it out and a lot of damage can be done, then you have to replace them. So it's like a year and a half. A person mistake's a year and a half of setting the company back. And you may lose good people in the meantime, because when you put a person in that job, they often drive out some other good people by the time you figure out you made a mistake. And you can avoid that because I don't know your name, but I can get the whole book on you and never meet you. Okay? I can find out how smart you are, how you treat people, how you treat your friends, bosses, peers, subordinates, whether you're on time, whether you show up, whether people trust you, whether you shave the truth. I can get that whole dossier on you. So we're pretty good now at making sure when we put people in these big jobs that we know they're pretty good. We still can make a mistake, but we, you'd be surprised the error rate is just dramatically less than it ever was before.

Speaker 45:32 Hello. Um, hi. Uh, I'm a 2018 Sloan fellow. Uh, I was working for JPMorgan in London up until March of this year, and I'm just wondering, where do you see the future of European financial services and particularly JPMorgan in the context of Brexit?

Jamie Dimon 45:47 Yeah, so Brexit, I mean, the fact is we're gonna be ser- we're gonna be prepared for hard Brexit, not because we're predicting it, though I think it's [laughs] I think it is pretty likely at this point. Uh, I think it's a very complex thing. It's not great for Britain. But the fact is, to be prepared, all we have to do is have our European subsidiaries get more capital, certain licenses, certain approvals, which we're gonna get, so that if, if, uh, you have the hard Brexit, it defaults the next day to existing EU law. Uh, under existing EU law, we simply have to do certain things contractually in a sovereign ent- in a entity that's in the, in the EU. And we have them. We've got, you know, licenses, proper subsidiaries in, in Germany, uh, Ireland, Brussels. It's only about 4 or 500 jobs. So it's not that big a deal. But for the f- but in reality, 12,000 people are servicing Europe out of London, even after a hard Brexit. And the real issue is what happens to those 12,000 in the 10 years after. Because I know what's gonna happen. Regulators and politicians are gonna walk in and say, "We're uncomfortable. We know you did the license and you booked the trade in this subsidiary, but then you back-to-backed it to that subsidiary to risk manage it, or you had the banker do the ECM deal here, but the research, risk, compliance, audit, uh, trading was all done in London, and that's not sufficient. We don't want a Potemkin village type of business. You got to move it here." And I think there's gonna be huge pressure to move those 12,000 people over time into the EU. And, you know, and my goal is to make sure we can serve our clients nonstop. It'll cost us more money. It's a real pain in the ass, but that's not the point. I'm not worried about it. I want to be able to serve those European clients. We, you know, we bank every European country just about, every big European institution, every big European investor. That's what I got to worry about, being prepared to do that on, you know, the next day.

Speaker 47:33 Um, thank you. This, this, uh, is a continuation of what you're talking about, but what areas of the bank do you see most exposed to, um, technology disruption? And you mentioned sales and trading before.

Jamie Dimon 47:46 Yeah, so I, first of all, like I said, technology's been changing the world forever. And so it's not like it's completely different. I think it's faster now. More money's going into fintech. You know, agile technology can do things that couldn't be done before. And I think it's incumbent upon any business to use technology to do a better job for its client. Better could be better, faster, cheaper, straight-through processing, obviously making it digital, mobile, stuff like that. Remember, banks have been doing that for years, and you can buy and sell FX on our, on your mobile phone now. And when some trade, some trader did a $400 million trade, and I said, "Oh God, you know, $400 million on a mobile phone." I said, "We got to put breathalyzers on those phones."

Speaker 48:21 [laughs]

Jamie Dimon 48:22 You know, I, I just envision, you know, some macho trader, you know, having two martinis and saying, "I'm gonna do this." But you know what? They, when I mentioned that to the risk people, they said, "We do have that, and we can actually put that in so that you can't do a trade without going through a breathalyzer or something like..."

Speaker 48:35 [laughs]

Jamie Dimon 48:36 Anyway, um, so I think in some ways, always look at a business from the standpoint of the client. So forget JPMorgan. So in the, on a, a lot of the things that clients need, they're still gonna need. In fact, those needs are gonna grow over time. Okay? ECM will still be there. DCM will be still there. Hedging FX and hedging interest rates will still be there. M&A advice will still be there. But we have to use technology to do things better, faster, quicker like everybody else, and straight through and all that kind of stuff. So, but if you ask me the thing that's gonna be most disrupted, it's gonna be payments. You know, there are payment systems which are antiquated, they're old. The ACH system is terrible. Uh, but we just put out a P2P. You all use Venmo? We just put out a P2P Zelle. It's real time, bank to bank. It's safer, it's better, it's real time. It's not social yet, but I don't possibly understand why you'd want to share all that stuff with your friends. But, uh, um, but it could be that. It could be in wholesale payments, you know, but you can go on screens now, move money around the world, convert to different currencies and... So we're, we're doing it, but if you ask me, that's where most of the disruption is going to take place. And now we, we've invested in 100 fintech companies, and we're willing to compete, build, uh, buy, whatever it is. And just to give you an example, we're going to have online trading and robo investing for our clients. It's in beta today. W- I, I'm not sure how we're going to roll it out. We're going to roll it out and test it and test price and all that stuff like that, but we could o- add a lot of those things for free if we wanted to. So, you know, we're not, we're not dead in the water, you know. So when the time comes, you're going to see us being very aggressive to win business just like we always have. And we rolled out, it's not being marketed, we rolled out a mobile-only bank in St. Louis recently, and we're going to test that. It's more for millennials than anyone else, but, you know, from opening the account to moving money, it's only the debit card, and we're going to see how that works, and then we're going to try to modify that and then do it in all 50 states. Go ahead. They'll, they'll get it eventually. No, Col, hold it up.

Speaker 50:28 John- Jonathan Wallen, second year, or third year, PhD student now. And, uh, I have a question about how, uh, you brought up bureaucracy and politicalization and the sort of detriments that does to the firm. And, uh, my concern is how do you assess the bureaucratization within J.P. Morgan, compare it with your peers, and how do you trade off the agency that you give to individual portfolio managers with the oversight from compliance?

Jamie Dimon 50:55 Yeah, well, I mean, [chuckles] we're pretty rigorous how we run the company. So, you know, we meet all the time and go through everything top to bottom, and we r-raise these issues and stuff like that. And so if you're... You know what your authorities are. If you're a trader or if you're a banker, you know exactly. You also know what you're not supposed to do, and you also know when you're supposed to go to a compliance committee or risk committee, an underwriting committee or credit committee. There's no mystery to any of that. And we, and it happens every day, and we barely make mistakes. The pro-- and, and I'm not going to stand behind regulatory things. You know, we have thousand new rules and regulatory requirements, and that does create some of the bureaucracy, but it's not an excuse for us to say, "This is a better way to do it." We listen to customers all the time. Uh, and, you know, the management team is open. Every issue, ev- the agenda is always set by them, so it isn't like you walk in the room and I set the agenda. If you work for me, I expect you to raise everything important. Everything and anything, including bureaucracies, cost, slowdown, bad service, competitors got something better than us. That's your job, not my job. And so, and that's, when I do it with you, hope- you know, presumably you're going to do it with your management team. So you're always airing all these issues. We go on bus trips, we go to call centers, we go to op centers, we got client reviews, we got advisory groups, and all those things get circulated. All of them, you know. And a- all, so all the complaints, and we're always trying to deal with that and become better and faster. You know, the, I think one of the tough thing about management is you have to get rid of the bad people, you know. So I could say anything I want, but if I have a bunch of goombahs or they're not that good or th- they're just, they're friends with Jamie type of thing, that is what causes the problem. And so very often you have people who are unwilling to get rid of the bad people. Bad could be because their culture's bad. It al- it also could be because they're not good, you know. They're not good enough. You know, so in a meritocracy, people say, you know, "Joe deserves the job," or, "Good old Joe," and, "He's been here a long time," and that doesn't mean they deserve the job. And, you know, in sports, you know, if you're not batting 250, you're not going to be playing second base, you know. And it's very easy to take out a pitcher who's not doing a good job. In business, they're left in those jobs for a long time. I'm not saying treat them disrespectfully. Now, if you treat people disrespectfully, uh, you know, you're going to lose their hearts and minds, too. So it's got to be a very respectful, "We're going to make a change for the following reasons." Uh, but you really, if you're going to run a real meritocracy, you've got to make sure you really do it. And those people, you know, it got, should filter through the whole company to, uh... Loyalty is, uh, such a misnamed thing sometimes. What they usually mean is, I was asked when I was a young CEO in a room like this, we had just done a big deal: "How can we be loyal to you when you weren't loyal to Joe? He's been around, he trained a lot of people in the room, and you just demoted him." And I couldn't answer the question, and I called the person the next day, uh, and I answer every question eventually, by the way, but I called him the next day and said, "I thought about it, and you got it backwards. If I was loyal to Joe and kept him in the job, and most people thought he just wasn't doing a good job anymore, who am I being disloyal to? Everybody else and the customer." And so it's a hard thing to do, but it, and that's the hardest thing to do in b- in, in management right there, and a lot of you will fail doing it because you'll... You know, the other thing that happens in management is you're owned by the staff down the hall. You know, and they, "Oh, I'll take care of it. Don't worry about it, I'll take care of it." And basically, they're, that, that becomes a club, and they're not, they're not taking care of it for the company or the clients, they're taking care of it generally for themselves. And so you have to be very, very careful in management about what you, why you're doing what you're doing and who gets to speak up and who's in the room and things like that.

Speaker 54:08 We've got time for one more question.

Speaker 54:11 Hi. Arvind. So I worked for JPMorgan Chase back in 2012, part of the team that redesigned the chase.com. So I do know, like, Chase is always more towards the technically advanced company, and this question is more toward the tech side. It's like, uh, what is the stand of banking community in AI, like artificial intelligence? Like, uh, AI is going to take over automation stuffs-

Jamie Dimon 54:32 Yeah

Speaker 54:32 ... and what does banking community thinks about it?

Jamie Dimon 54:34 Well, I, I don't care what the banking community thinks. I'll tell you what I think. [chuckles] Uh, big data, AI, machine learning, chat boxes, robots, they're all real. You know, we have thousands of data scientists and PhDs and, and not just coding. You know, we spend $9 billion a year on technology, $700 million a year on cyber, uh, probably $1 billion a year now in just some of the stuff just uniquely devoted to that, uh, and it's real. It's an amazing thing that you can do. You can do today in a split second. So we used to like, used to s- when you swipe that credit card, you know, it goes through hundreds, maybe a thousand algorithms to test for fraud, where you did it, how you did it, what time. We do the same thing for big payments. So if you run a company, a small business, large company, like what happened to the Federal Reserve never would happen to us. You know, payments at the wrong time, different type, different entry. We're actually monitoring your systems all the time. And we see anything wrong, we're calling you up and stuff like that. So it's real. The hardest part about it isn't understanding it or knowing the technology. It's getting the people in the company to understand the power of it. So when we first started big data, we put, and we, big data machine learning, we put it up at the central for standards and, you know, we use Hadoop, but to make sure that you don't end up with 84 different platforms and stuff like that out of control. Uh, and machine learning has to, has another problem with regulation that I won't go through. But we put it at the top, and we had to say to you, "Hey, you do prospecting? How do you do it? Why do you do it?" We made prospecting 10 times more efficient than a commercial bank. 10 times. Don't, and don't think that, okay, the cost is lower. You know, instead of $30,000 or 3,000, it also means we could put two more bankers in Grand Rapids. I mean, it's a huge benefit to the company and, and be immediately productive as opposed to take three years to build it up. And, and then once we did that, we now have it in every division. And so every division has a big data, AI, machine learning thing, and every, we ask every manager, "Come back and give us the use case you think is best for you." And so we're trying to... And by the demand is going up like this, but it's one of the areas you want the demand. You know, you want to spend more money, and obviously you want to spend it wisely, but we push people. So in technology, I always do that. You can't ever say to me you didn't do it because of the budget or you couldn't afford it. It's not allowed. You have to put it in, you know, budget's only a reflection of, uh, 12 months of a plan. I tell you, you have to put in that plan everything you need to do. Going to Salesforce, going to companies, going technology. You know, don't be a baby about it, because people say, "Well, we didn't do it because we couldn't afford it this year." Who said? We can afford anything we want. We spend $58 billion a year. We make 35 billion pre-tax, and if you guys spend another $2 billion to get big data right, we're gonna do it. So it's more about, it's more about the getting it executed right than it is about the money.

Speaker 57:05 Everyone please join me in thanking Jamie Dimon.

Jamie Dimon 57:07 Thank you very much. [audience applauding] [upbeat music]