On Monday January 9, 2012, I attended the J.P.Morgan Healthcare Conference luncheon at the Westin St. Francis Hotel in San Francisco. During the luncheon, Maria Bartiromo, journalist and news anchor at CNBC, interviewed Jamie Dimon, Chairman, President and CEO of J.P. Morgan Chase about a number of issues facing his company, the U.S. economy and Europe in 2012.
I compiled a list of some of the answers to questions from Bartiromo and Dimon’s answers to those questions. Bartiromo asked Dimon about the financial health of J.P. Morgan Chase. The stock is lower, but the company is better with record earnings, Dimon said. When asked about the U.S. economy, Dimon’s answer was that the U.S. economy is in a mild recovery. He sees small business in better shape. He does not see a huge formation of small businesses, however. It is not access to capital that is the problem, but demand for their products. There are also IPO backlogs.
He said that early indicators for the recovery include: housing improving and near bottom and shadow inventory is getting better. He also believes that more people working, the better it is for the economy. He is not nervous about the capital markets. However, he did say that geo-politics is always the wild card. When asked about the European debt crisis, he said that it has to be fixed for the health of the world. He said that “countries have to be responsible. They need to change their fiscal policies.” J.P. Morgan has cut back exposure, but still is investing in Europe.
Bartiromo also asked Dimon about the “Basel Stress Test”. He said he is in favor of a good stress test. Dimon said that J.P. Morgan will be fine with worst case scenario. He added that J.P. Morgan never lost money in a quarter after the greatest stress test, which was the “Financial Crisis” in 2008. He wants fairness around the world for derivatives. He also commented on the Fed’s “Volcker Rule.” “The Feds do not want us to take any risks,” Dimon said. He wishes that people “writing these government rules were business people.” However, he is not opposed completely to regulation.
When asked about ObamaCare, he said he wants healthcare for everyone, but he believes that “ObamaCare just added to the mess.” Bartiromo asked him about Fannie and Freddie. He said they should have a hybrid or eliminate them.
When a member of the audience said he should run for President, there were huge laughs. However, he said he has no plans to do so.