JPMorgan Chairman And CEO Dimon: Elizabeth Warren vilifies successful people

 

CNBC Exclusive: CNBC Transcript: JPMorgan Chairman And CEO Jamie Dimon Speaks With CNBC’s Wilfred Frost Today

JPMorgan Chairman And CEO

Image source: CNBC Video Screenshot

WHEN: Today, Tuesday, November 5

WHERE: CNBC’s “Closing Bell”

Following is the unofficial transcript of a CNBC EXCLUSIVE interview with JPMorgan Chairman and CEO Jamie Dimon, which aired on CNBC’s “Closing Bell” today. Following is a link to video of the interview:

Additional portion of interview ran on CNBC’s “Squawk on the Street” today.

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JPMorgan Chairman And CEO Dimon says Sen. Elizabeth Warren ‘vilifies successful people’

 

Morgan Brennan: wilfred frost sat down with JPMorgan ceo jamie dimon today and joins us now with part ii of his exclusive interview.

Wilfred Frost: hey, Morgan yes, indeed. So in part ii, I started by asking Jamie Dimon about that change that the business roundtable made to their overall statement back in august where they dropped the primacy of shareholder first and instead shareholders became now one of five different stakeholders, alongside customers, workers, suppliers, and communities and I asked jamie dimon why make the change now.

JPMorgan Chairman And CEO Dimon: a reporter actually pointed out that your statement from 1997 is still primary shareholder value. Ie all you care about is profits and shareholders. And we went and read it and the board read it and the business roundtable and the governance committee ran by Alex Gorsky and we all said, this doesn’t represent at all how we run a company I mean, first and foremost we talk about customers.

We better do a good job or we lose we better take care of our employees or we lose and we all want to be great community citizens so it was an evolution to recognize reality. Think of it like a team. It’s very simple to say, show the value and you want a simple answer, but you can’t win with a great quarterback if you don’t have a running back and a receiver the team wins.

And you have to do each well to be successful. And that’s what it acknowledges. It’s still, shareholder value but it’s much more long-term the brt also took off you don’t have to do earnings guidance, which most of you was think is a complex, unnecessary thing to do, which causes some short-term pressure. And you can put your best foot forward.

What do we for consumers, employees, communities one last thing about communities, lifting up a community, it’s probably a little bit more removed than the rest of it but if you go around the world and you have healthy economies, which are based on good policy, you have healthy businesses and much healthier citizens.

And if you go to other economies that aren’t growing at all, their businesses are terrible their citizens are terrible thre’s nothing’s wrong with people saying, I’m going to use some of my skills and talents to lift up society. And that would be better for everybody including your business

Frost: senator warren embraced the brt statement and she went further and she wrote a letter to you saying that she expected you to endorse and wholeheartedly support the reforms laid out in her accountable capitalism act to meet the principles that you endorse what’s your response to that.

JPMorgan Chairman And CEO Dimon: I think that’s sloppy logic that I think that’s right because we changed our statements and I think that people have the right to look at companies and say, what are you doing for your customers and your employees are you helping out the community and stuff like that. And there’s a lot of stuff that I may not go through now but to me, that we should do but changing the complete nature of how you run a corporation absolutely not

Frost: you’ve dealt with senator warren plenty of times whether recently or in hearings or when she was head of the cfpb do you think the characterization of her in the press that she’s anti-business, anti-capitalism is fair?

JPMorgan Chairman And CEO Dimon: look, I don’t know. You really have to ask her what she really means she uses some pretty harsh words. Some would say vilifies successful people I don’t like vilifying anybody I think we should applaud successful people.

A lot of people come to this company for opportunity and choice and success we want that for everybody that’s a little bit different than paying your fair share and how the taxation system should work that I completely understand but I think we should look that America was founded on free enterprise freedom and free enterprise they’re interchangeable.

You can’t separate them from each other successful companies have lifted up society it doesn’t mean they can’t do more or didn’t make mistakes I think we should applaud that and if people are very specific things that we should do different, we should think about doing them different

Frost: if the vilification part was we removed, any of the general aspects that she talks about that you agree with in terms of wealthy people paying more I heard you speak recently at an event with tim adams and james gorman you talked about having a negative income tax.

JPMorgan Chairman And CEO Dimon: yeah. I think it’s important that pe people recognize the things that haven’t worked in society. Inner city kids aren’t graduating, infrastructure doesn’t work. It’s very -- you know, I think 15% of america makes $10 an hour or less, which is clearly not a living wage.

I think it’s in all of our interests to have proper safety nets, fix those problems and send people to work. And I would be in favor of a negative income tax to get people to work we have one kind of in the earned income tax credit which is supported by republicans and democrats. But limited mostly to single women with children. I think it should be expanded. Jobs create dignity.

So I think acknowledging people with problems and fixing it doesn’t mean their policy is always right the road to hell is paved with good intentions when it comes to policy and you should be very careful about what you’re trying to accomplish there are a lot of examples around the world about policies that work and policies that didn’t work. A lot of wealthier people I know wouldn’t mind paying more taxes, but it’s very important for my democratic friends to also look at the following they should justify how they spend money.

Every department in washington, every one, should say, I took your money, mr. And mrs. Citizen, and here’s what I did with it. Not how much I took but how many jobs, how many roads and fix these things. And put a little pressure on yourself before you just ask for more I don’t think even democrats believe that throwing tons of money at washington, d.C. Is going to make the country that much better off.

I think people are very cautious about feeding the beast too much and for good reason. A lot of government programs have been abysmal failures and we should acknowledge them both problems need to be fixed. Those solutions didn’t work. Let’s try something different.

Frost: if the race was warren versus trump, do you think for the first time there would be a genuine opportunity for an independent candidate?

JPMorgan Chairman And CEO Dimon: I don’t think so. I mean, there may be an opportunity one day for an independent party, but I don’t think. People that know much more about policy have studied that and have come up with the answer, no

Frost: to bring it all together, jamie, you said that when your new headquarters is finished that you wouldn’t be moving back in at that point if the building works on time, you’ve got three or three or four years left in your position

JPMorgan Chairman And CEO Dimon: well, I always say five

Frost: well, you said five a years ago. It’s definitely not -- I’m always going to say five wherever you ask me, I’m going to say five. That’s up to the board and hopefully we’ll have a great transition

Frost: but what -- however many years it is, you’re clearly incredibly passionate about your country.

Dimon: yeah.

Frost: and very involved and thoughtful about the policies that can make the country stronger so after banking, is some form of public service an option for you?

JPMorgan Chairman And CEO Dimon: probably not. But I would never rule anything out. And never say never, but I do -- I think that business, civic society you think hospitals, schools, non for profits, working for government can fix our problems yelling at each other is not going to fix our problems. Collaboration woxks and you can go to certain cities across the world. That works like, how do we get kids’ jobs at the inner city schools.

That’s probably going to take business and community leaders and teachers to agree we need this kind of training can you help us train the trainers so I want to fix those problems I think we’ve really held America back I’ve mentioned many times we’ve grown 20% over the last 10, 11 years. It should have been 40% people don’t ask that question. 40% if you had another 20% growth or even 15% growth, that would have been another $3 trillion of gdp, another $1.5 trillion in the pockets of our citizens that would have sucked up $1 trillion or more of capital.

Instead of buying back stock, maybe they would have needed that capital to invest in their businesses wages would have gone even more. Inflation would be higher. It would be more normal. I think we did this new – you know, this secular stagnation, this new normal, I think we did it to ourselves through bad policy, infrastructure, certain taxation, inner city schools, too much regulation, you know, a capricious and slow litigation health care which costs too much I think those are the things that are holding us back and we should share the more privileged in this nation with the less privileged.

Frost: probably not, but I would never rule anything out, his answer there as to whether a public service role could follow his time in finance, followed by another minute of policy so make of that what you will. Either way, he’s clearly not going anywhere soon. Whether it’s five years or three years, clear that he’s staying at the helm of JPMorgan for a little while longer, at least yet. Guys, back to you.



About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Prior to ValueWalk, Jacob was VP of Business Development at SumZero. Prior to SumZero, Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver