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

Stanford Graduate School of Business2017-11-09

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💫 Short Summary

Jamie Dimon discusses his journey from Harvard Business School to Goldman Sachs, emphasizing character and truthfulness in leadership. He advocates against bureaucracy in companies and highlights the importance of customer-centric actions. The financial services industry's global impact and the potential of blockchain technology are discussed. Dimon stresses the need for competitive tax reform and infrastructure improvements in the US. He also addresses the importance of diversity, inclusion, and work-life balance in the workplace. The speaker reflects on personal growth, mistakes, and the impact of people mistakes in organizations. Leveraging technology in banking and maintaining a meritocratic approach are key themes throughout the video.

✨ Highlights

📊 Transcript

✦

Jamie's journey from Harvard Business School to Goldman-Sachs.

01:26

Jamie gained insights into large corporations while working at a small consulting company before joining Goldman-Sachs.

Character and truthfulness are essential qualities in leadership, according to Jamie.

Jamie emphasizes the importance of individuals who enhance conversations and bring fresh perspectives.

Jamie reflects on his decision-making process and expresses willingness to make the same choices again, showcasing the significance of seizing opportunities and prioritizing organizational involvement over specific roles.

✦

Importance of avoiding bureaucracy in companies.

04:33

Bureaucracy drives out good people and innovation, promoting competition over collaboration.

Politics hinder company growth and cause failures among Fortune 500 companies.

Focus on collaboration without necessitating agreement on all aspects, emphasizing loyalty to the institution and customers over personal loyalty.

Speaker discusses candid communication style appreciated by Warren Buffett, attributing it to early development.

✦

Speaker advised against entering corporate America due to outspokenness, influenced by Warren Buffet's principles.

06:15

Emphasizes importance of customer-centric actions over empty statements in business.

Discusses historical impact of technology on societal change and potential career opportunities in finance.

Expresses concerns about government intervention in big tech companies.

Praises role of technology in financial services.

✦

Importance of Financial Services in Driving Capitalist Economies.

09:38

Financial services industry includes private equity, venture capital, and diverse investment options.

High-tech and well-paid field due to complexity and global reach.

Companies operating globally face regulatory challenges.

Emphasis on recruiting top talent from investment banking with general management skills.

✦

Discussion on Blockchain Technology and Cryptocurrencies.

12:37

Emphasis on the real-world applications of blockchain technology and potential security concerns.

Explanation of different types of cryptocurrencies, including ICOs and using cryptocurrency for fiat currency.

Belief that governments will regulate or crush Bitcoin due to concerns about terrorist activities, financial losses, and currency control.

Uncertainty about the long-term viability of cryptocurrency and comparison to fiat currency.

✦

Potential of blockchain technology in finance.

15:49

Current applications include moving money within banks and the importance of up-to-date records.

Discussion on the time lag in equity trading compared to traditional methods.

Speaker's involvement in President Trump's business advisory board.

Mixed reactions from family for joining the council.

✦

The speaker emphasizes the importance of detailed work within government agencies and the need for proper decision-making.

18:23

He expresses support for diversity and denounces white supremacy, highlighting the importance of combating bias in the press.

The speaker recounts a conference call where a decision was made to disband a council, clarifying that the President did not agree.

He advocates for explaining positions to combat bias in the media and stresses the importance of business collaboration in government decision-making.

The speaker calls for political assistance regardless of personal opinions to support the United States.

✦

Contrasting Resources and Capabilities of the US and China.

21:55

The US has abundant resources, a strong military, superior universities, rule of law, low corruption, and transparent markets.

China faces shortages, conflicts, and lacks these advantages.

Societal issues in the US include high felon rates, job discrimination, and educational disparities.

Despite millions of available jobs in skilled trades, there is a lack of workforce training.

✦

The importance of competitive tax reform in the US economy.

24:37

Companies are being acquired by foreign entities due to tax advantages, leading to missed opportunities and negative economic impact.

Proper regulation and opening up the credit box for mortgages are crucial for economic growth.

Infrastructure improvements, education, and competitive tax reform are needed to address challenges like small business formation and lack of credit access.

✦

Company mistake leads to record profits and $2 billion in fines.

27:23

Hedge backfired, causing losses for shareholders and government penalties.

Lack of proper strategy and monitoring acknowledged by speaker.

Despite risk reduction attempts, company ends up in a worse position.

Importance of learning from mistakes, taking swift action, and maintaining professional behavior emphasized.

✦

Importance of Leadership in Creating an Inclusive Work Culture.

31:14

Emphasizes the need for leaders to treat all employees with trust and respect to encourage open communication.

Insights shared on engaging with team members regardless of gender to foster inclusivity.

Stress on the importance of specialized programs and a supportive environment for success.

Personal anecdotes and examples given to illustrate effective leadership strategies.

✦

Importance of diversity and inclusion in the workplace according to Jamie Dimon.

33:42

Dimon highlights the presence of women and LGBTQ individuals in leadership positions at JP Morgan Chase.

Emphasis on the need for a supportive environment for all employees and zero-tolerance policy towards discrimination or exclusion.

Addressing work-life balance and time management challenges faced by professionals, advocating for fair assignment practices and senior approval for weekend work.

Stressing the value of creating a welcoming and accepting company culture to build a successful organization.

✦

Importance of work-life balance and personal well-being.

36:11

Avoiding unreasonable demands from bosses by setting boundaries.

Emphasizing the need to work smart, manage time efficiently, and prioritize self-care.

Advocating for spending quality time with children over leisure activities.

Overall message is to prioritize personal well-being and time management for a balanced life.

✦

Balancing work and family time is crucial, with women facing unique challenges in managing both aspects of their lives.

38:55

Thoughtful life management is essential, emphasizing the ability to have it all, but not necessarily all at once.

Despite battling throat cancer while leading JP Morgan, the speaker chose to continue working during treatment.

Maintaining a strong work ethic and surrounding oneself with a supportive team and family is key during health struggles.

Finding comfort in the familiar environment of the office helped the speaker navigate through difficult times.

✦

Speaker expresses skepticism towards Bitcoin and advises against trading it.

41:38

Potential risks of people losing money are mentioned.

Importance of self-awareness in leadership is emphasized.

Negative impact of decision-making in anger is discussed.

Personal growth is reflected upon, with an example of showing maturity by walking out of a situation that angered them.

✦

Impact of people mistakes in organizations.

44:41

Emphasis on thorough vetting of individuals before hiring to prevent setbacks and potential damage.

Importance of evaluating character, behavior, and trustworthiness before assigning significant roles.

Implications of Brexit on European financial services, including JP Morgan's preparations for a hard Brexit scenario.

Potential relocation of employees to EU countries in response to Brexit.

✦

Importance of technology in banking for better client service.

47:44

Emphasis on adapting and improving through agile technology like mobile banking.

Potential disruption in payment systems with focus on real-time bank-to-bank transactions.

Mention of investing in Fintech companies and developing online trading and mobile investing for clients.

Leveraging technology to enhance banking services and stay competitive in the market.

✦

Emphasis on company's aggressive approach to winning in business.

49:58

Discussion on launch of mobile-only bank targeted at millennials.

Highlighting rigorous processes in place to address bureaucracy and politicalization within J.P. Morgan.

Importance of addressing complaints, continuous improvement, and removing underperforming employees for company success.

Stress on meritocratic approach in evaluating employees' performance and making tough decisions for company's benefit.

✦

Importance of running a real meritocracy and ensuring loyalty filters through the whole company.

53:00

Loyalty in the context of demotions and job performance is discussed.

Difficulty of managing thin lines and avoiding self-serving behaviors is highlighted.

Need for careful management decisions, considering motivations, and who has a voice is stressed.

Shift to AI and technology in the banking community, focusing on big data, AI, machine learning, and cybersecurity investments.

✦

Implementation of machine learning in a commercial bank improved prospecting efficiency by tenfold, reducing costs and enabling the hiring of more bankers.

55:50

The implementation across divisions led to increased productivity and demand for AI and big data solutions.

Management was encouraged to propose tailored use cases, driving further adoption.

Emphasis was placed on prioritizing technology investments regardless of budget constraints, with a focus on effective execution over financial concerns.

The company's substantial financial resources and willingness to invest in data initiatives positioned successful implementation as a matter of strategic planning and commitment.

00:00[MUSIC]

00:06Jamie, welcome and thank you very much for coming here today.

00:07>> Pleasure to be here, thank you, everybody.

00:09I noticed a lot of other folks here I didn't expect to be here, so welcome,

00:14friends, from other places.

00:17>> This is the third you've come to talk to us and

00:19I have to ask are we just very lucky to have you or is there some perhaps latent

00:23regret in choosing our competitor on the east coast for your own business school?

00:27>> [LAUGH] >> [LAUGH] So

00:27why, my wife went to Harvard Business School, I went to Harvard Business School,

00:32my daughter went to Harvard Business School and

00:34two son-in-laws went to Harvard Business School.

00:38But we love Stanford.

00:38>> [LAUGH] >> I like to come out here all the time.

00:41When I come out here I realize why you don't work so hard out here.

00:45>> [LAUGH] >> [LAUGH]

00:47>> Now speaking of business school,

00:49we have many people in the room who are trying to decide between entrepreneurship

00:52and more traditional paths on leaving.

00:54Do you mind talking to the decision you made on leaving Harvard yourself, and

00:58if you'd do the same thing today?

01:01>> So when I'd worked at a small really second rate consulting company

01:06before business school, back then they had a deferred admit, so

01:08I was admitted but I had to work for two years.

01:10And I did the consulting thing,

01:13you learn a lot, I also learned I didn't want to be a consultant.

01:16But I saw a whole bunch of different companies and industries, including badly

01:20run political, all these various things, so it was actually a very good experience.

01:26But when I got to Harvard Business School, I actually worked at Goldman-Sachs

01:29the summer of 81 and I was headed back to Goldman, Morgan, or Lehman.

01:35I was probably going to decide Goldman, and at the last minute,

01:38Sandy Weill offered me a job to be his assistant.

01:40He had just sold Shearson,

01:42which is a brokerage firm with a couple thousand brokers through American Express.

01:46And it just looked like it was just too good to not to see a large corporation

01:49from the inside, how it goes.

01:51My goal in life was to be part of an organization.

01:53It wasn't necessarily to be an investment banker or a trader or something like that.

01:57So I took the crap shoot, I figured, worse comes to worst,

02:00I can go back to Wall Street.

02:01So I didn't feel like I was going to lose anything but time.

02:04Yes, I would make the same decision again.

02:08Maybe not for the same guy again but the same decision.

02:10>> Now, Samuel Weill obviously saw something in you at the time.

02:15When you meet men and women our age at JP Morgan today,

02:17what leadership characteristics are you looking for in them

02:20,and how do you identify and bring those people through as the next generation?

02:24>> When you're young, it's hard to say leadership characteristics but

02:27there's just some basic stuff.

02:29There are people who know a lot.

02:32There's some people walk into your office and

02:34say, I'd like to know about the strategy of the company and they didn't bother to

02:38read the chairman's letter I wrote which is 30 or 40 pages long.

02:40There are people who walk in and say, you really should be thinking about doing

02:44better digital services but they don't look at the ones we do do.

02:47The other people walk in and they know everything, and so

02:50when they have a conversation,

02:51they're actually enhancing your life as opposed to the other way around.

02:56So character is a sine qua non and by character,

02:59I also mean that they tell the whole truth, nothing but the truth.

03:02They don't shave the truth and they say the same thing to you that they say to

03:05you, because the second I see people doing something different than that,

03:08you just go on a list to me, I have no interest.

03:11I don't have time for that and I won't have interest in it, and

03:15people who are good relate well to other people, so a variety of things.

03:20>> I think when we look at finances, often people

03:23concentrate on the competitive leadership characteristics they see there.

03:27At the GSB, we have a real folks on the collaborative.

03:29How do you see the balance between competitive and collaborative [CROSSTALK].

03:31>> Competitive inside the company?

03:33>> Inside and out.

03:34>> I think the things that destroy companies, folks, are bureaucracy and

03:38politics.

03:39We had an offsite this summer, I asking many times, we gotta make this simple,

03:45we gotta make this better, we gotta kill our meetings are too long,

03:49and we stand behind regulations sometimes, the regulators are making us do it.

03:52But I said no, we're going to re-imagine all these things the way they should be,

03:55not the way they are today and

03:58let's take a crack at killing some of this bureaucracy that's grown up recently.

04:01And someone wrote a memo, and we all do pre-reads.

04:04In my meetings, you don't flip through a chart, it's all pre-reads, I expect you

04:07to do your homework, get the analysis and part it up with people beforehand.

04:11So you don't walk in and say, I want to do a, b, and c but

04:13I haven't spoken to this person yet.

04:15I would say, why didn't you speak to this person?

04:17The meeting is cancelled.

04:18Go do that first and then come back with a joint recommendation or that you disagree

04:22and then we'll talk about specifically why you disagree about something.

04:25Anyway, I'd asked about bureaucracy and

04:27the pre-read by saying bureaucracy is a initially a condition at

04:30the output of complex businesses operating in complex global environments.

04:33It's just not true, bureaucracy kills.

04:36Bureaucracy drives out good people, it drives out innovation.

04:40It makes the person in the office next to you a competitor and

04:43not a collaborator and that's a really bad idea inside a company.

04:46Now it's okay to compete with ideas but

04:48it's really bad idea when you're competing with the person next to you.

04:51It creates politics and if you look at what's killed companies over the years,

04:55it was bureaucracy.

04:56When you look at the Fortune 500 and you did a 1950, 1960,

04:581970, 1980, look at the companies who failed,

05:01it was because they were dumb, bureaucratic, backward and political.

05:06CEOs should never allow that stuff and yet they do, as a normal course,

05:11they allow it and you've seen a lot of public companies and boards allow it.

05:15Boards can create it, by the way.

05:16So absolute collaboration, but

05:19collaboration does not mean everyone has to agree.

05:23Collaboration does not mean you go a long to get along,

05:26because that's very often what people mean by it.

05:28He's a good guy, if you walk into me and say I'm going to be loyal to you,

05:32l would question what that means because you should be loyal to the institution.

05:37You should be loyal to the customers, you could be loyal to the principles for

05:41which l stand, but being loyal to me usually means you're going to defend my

05:44decision whether or not you agree, which I just think is a mistake.

05:47>> You're well known for having a very candid and open,

05:50forthright style of communication.

05:52It's appreciated by Warren Buffett, he says he loves your chairman letters, and

05:55we obviously appreciate it here.

05:56What was it that led you to develop this style of communication early on?

06:02>> I'm one of those who I don't think I've changed much since I've been eight.

06:04>> [LAUGH] >> When I got to Harvard Business School,

06:08some of the advice I got when I was graduating was whatever you do,

06:11Jamie, don't go into corporate America, you won't survive.

06:15>> [LAUGH] >> And there was truth to that,

06:18I was a little too outspoken for some corporations etc,

06:21and part of it was Warren Buffet.

06:24When I was in high school or college, I actually read his partnership letters.

06:30He would say, I'll speak to you as if you're my smart sister who doesn't know

06:34everything I know, so I have to go out of my way to explain it to you.

06:37Business is not that complicated,

06:38we should be able to explain it, I always felt exactly the same way.

06:41I always felt as a matter of principle inside a company,

06:45if I allow spinning to the public, you are going to spin to me.

06:50Think of earnings, numbers, how great we are doing when we're not and so

06:55I say the same thing to you that I say to my board, that I say to my shareholder,

06:59I say to my employee, that I say to my customer.

07:01There is no difference.

07:02I might phrase it differently because you're talking to

07:04different group of people and you're trying to explain yourself, but

07:06there is no difference, and that clarity, I think,

07:09helps a company know what it's trying to accomplish all the time.

07:12When I read annual letters, and it's all gobbledygook in the letter, my respect for

07:16the company drops a little bit.

07:19And then you gotta be very specific, because we can all say,

07:22the customer is the most important thing, and the customer, the customer.

07:24But it should mean something specific like,

07:28do you actually read customer complaints and

07:31then you do something about it as opposed to, we put the customer first.

07:35A lot of people say that and they don't mean it in any way, shape, or form.

07:38They do no actions that would actually support the statement.

07:43>> So this one I'm afraid I'm going to try to sneak in some more career advice.

07:46I think everyone here is aware that tech is extremely sexy right now.

07:49>> A little bit less so today.

07:51>> Don't say today.

07:52[LAUGH] What do you think is the opportunity in a career in finance that

07:56some in audience maybe aren't seeing?

07:58>> First of all, one thing about tech,

08:00tech is driven I don't think it's different than it was before.

08:02It's driven change throughout all of history, and

08:06all various forms of technology from the actual chips to Internet.

08:10But also printing, energy, institutions,

08:14schools, the churches, the dissemination of morality.

08:19That's what's always changed society.

08:22It's always at the root, it's at the root of changes in businesses,

08:25it's at the root of changes in what companies do well and

08:28what companies don't do well, so it's absolutely critical.

08:31I personally think Silicon Valley kind of got a free ride with Obama in

08:34the White House.

08:35You pandered to him and he pandered to you,

08:38now you're seeing a little flip side of that.

08:41So the big companies, the successful ones are going to find out,

08:44which I've known a long time.

08:45The bigger you are, the more the government's going to get inside what you

08:49do, and want to impose on you and set rules and standards,

08:52and sometimes for good, sometimes not for good.

08:54But, so financial services, so

08:56I think technology's an absolutely wonderful thing.

09:00But financial services, first of all, we are a huge user of technology.

09:03We spend $9 billion a year, so we're not at the bleeding edge, but

09:08we're damn close.

09:09In terms of what we spend money on, what we do, our data centers, our capabilities,

09:13our mobile, our digital.

09:15We move $6 trillion around the world every day digitally,

09:19not cryptocurrency, but close to it because it's digital.

09:23And we bank 50 million people on our households and

09:27soon we're going to have online investing and robo investing and all these

09:30various things to link in to our accounts, so we are huge users of that stuff.

09:35We also use the advertising on Facebook and Google, etc.

09:38But financial services is always going to be an interesting business,

09:42because it's not the most important business, but

09:45it is at the nexus of how a capitalist society functions.

09:49It's part of the spinning wheel.

09:50And when I say financial service, I'm talking about all of it, private equity,

09:54venture capital, activist, whether you like them or not, banks, nonbanks,

09:58individual investors.

10:00A lot of companies that do things individually,

10:02that help change the world a little bit.

10:04But it's always going to this field that when money gets invested,

10:07the ideas come together.

10:09Things get executed, capital gets executed globally.

10:12So it's always fascinating, it'll always be well paid,

10:15whatever some of these folks say in DC.

10:17It has to be well paid because you can't do it with dumb people making dumb

10:22decisions, if you think you can actually run a good economy or something like that.

10:25It will always be a high tech user, and

10:28it will always be complex and global by its nature.

10:31And so it's a fascinating business.

10:33When you wake up in the morning, when I read the paper,

10:35there's very little in the paper that I'm not reading and thinking about.

10:38It affects our clients, it affects our companies, it affects our risk.

10:41It affects our exposure,

10:42we should be doing something about it, like just any article.

10:45because we do business in well over a hundred countries, and with just about

10:49every country and every sovereign wealth, and so it's a fascinating field.

10:52I mean, when you get into it, there are all different parts to it.

10:55And you gotta decide if you want to get into it, how you want to get into that.

10:59One of the things we set up, which I really like, is,

11:01we hired top-notch people from investment banking, okay, and sales and trading.

11:06So we go to the best schools in the world, we hire some of the best people.

11:10We now do the same thing for general management, about eight or nine or

11:13ten a year because we need people who can run the damn joint, too.

11:16And I want the same quality and we move around the company,

11:19kind of keep an eye on them.

11:20But the point is, they want to be global, they want to move around, and

11:24they want to learn how to manage and run something.

11:27So the same kind of compensation as investment bankers,

11:30same openness to senior people, so that we can get them.

11:34Not that if you're an investment banker, you can't move into management or

11:37sales and trading,

11:38but this is really people want to do more management of financial services.

11:43>> You mentioned cryptocurrency.

11:44I know you said you weren't going to talk about Bitcoin anymore,

11:47but you're at Stanford.

11:48Some of us put all our student loan money into it.

11:49And I have to ask you anyway, why do you believe that governments and

11:52regulators can't allow the existence of a global currency based on

11:56[CROSSTALK] >> I've become like a spokesman against

11:58BitCoin, I don't care about BitCoin.

12:01I could give a shit, to tell you the truth.

12:02>> [LAUGH] >> And

12:03I promised myself I wouldn't talk about it, the next day.

12:07There are four things really quickly, blockchain is real, it's technology,

12:10it could be public or private, it could be for five people,

12:13it could be for 5 million.

12:15It's going to work.

12:15We already use it in a lot of test cases and stuff like that, so we're a supporter.

12:18I do worry a little bit about the security because, like I said,

12:22we move $6 trillion a day, real time, quite efficiently, effectively and secure.

12:27Before you replace that, you gotta [LAUGH] make sure you can do it right.

12:31There are three cryptocurrencies, okay, three types, three separate types.

12:36One is ICOs, ICO and I haven't studied these things, but you're paying for

12:41a token that allows you to use a service, which is very different than a currency,

12:45but that's what people call cryptocurrencies.

12:47And maybe, Jim, maybe you've studied some of these ICOs, I have no idea.

12:51Someone gives you cloud services or you invest in services, that's one type.

12:55The second type you can use cryptocurrency for fiat currency.

13:00Well, that works because it just uses different technology to move money around.

13:04Basically we keep your money digitally anyway, and if you just keep

13:07different files in a different way and distributed ledgers, that would work fine.

13:11But I've always thought about Bitcoin as a currency and a store value and

13:15a payment mechanism is that governments, and this is my belief and I'm maybe wrong.

13:20I'm not telling you you can't go to $100,000.

13:22That governments are going to crush it one day for three reasons, okay?

13:27One is when it's used for terrorist activities, okay?

13:30It'll happen, it's a matter of time, it'll go back to a Bitcoin and

13:33then all of a sudden, the DOJ, the United State government,

13:36all these people in Washington who profess to love technology and

13:40the novelty of Bitcoin are going to change their mind.

13:43Number two, when a lotta little old ladies lose their money.

13:45Because the speculative vehicle is allowed to exist by the United States government.

13:49And they're going to lose their money, they're going to be pounding.

13:51You should of done something about it.

13:53And number three is the most important.

13:54Whenever a government forms itself,

13:56and you go to any country in the world, pull out the currency, look at the date,

14:01that fiat currency was formed by that government with the central bank.

14:05Because governments like to control their currency.

14:07They like to know who has it, where it's going, why it's going, when it went, etc.,

14:11and right now, Bitcoin's a novelty.

14:13It's $100 billion and $1 billion a day trades hands.

14:17Obviously, mostly speculation, okay?

14:19And obviously, there's a real use case, I'm not making it as a joke.

14:22Venezuela, Cuba, North Korea, criminal, drug money, that will always be true.

14:28So we'll always have a use case that's valuable to someone because it's better in

14:32those countries to have that than currency or money in the bank,

14:36because the governments, they take that too.

14:39And if you go to Argentina, they had effectively savings accounts,

14:42the government just went in and took it.

14:44They just took it, and of course, everyone took their money out of the bank right

14:49after that, and the country basically collapsed.

14:52So that's the reason why.

14:54It's going to get bigger and bigger and they're going to want to control it.

14:56And it's not the same as a fiat currency.

14:58A fiat currency, the government says, you must take this as legal tender.

15:04And at par, effectively cash, at par, and it's always worth par.

15:10And I don't know why a crypto dollar would ever be something that the store value

15:14would be worse than a crypto Bitcoin.

15:16So that's my view and I may be wrong, which I doubt, but-

15:21>> [LAUGH]

15:24>> I've been wrong before, though.

15:26So, and if I'm wrong, I also don't care very much.

15:29It'll never affect my life.

15:31It's not because they're right, or the bankers are defending their stuff.

15:34Absolutely untrue.

15:36If Bitcoin works and we have to do something, Bitcoin will do that too.

15:38>> Kind of a win-win there.

15:40>> [LAUGH] >> JP Morgan's a big investor in

15:44blockchain technology, as we've seen from Bitcoin.

15:46What do you think the most interesting applications of blockchain are going to

15:49be in finance?

15:49>> So blockchain, it's not like a faster chip or the Nvidia GPUs and

15:54stuff like that, because when you get certain technologies,

15:58they just filter through the whole system.

16:01And they allow you to do things differently everywhere.

16:03Like more database and more reading different natural language processing.

16:08You basically have to write code to have a use case for Bitcoin.

16:12So think of it, it'll be deployed use case by use case.

16:15We're using it to move money inside the bank.

16:18Something like 30 or

16:2040% of the $6 trillion we move is just between JP Morgan Chase accounts.

16:25Okay, that's sort of a marry area.

16:27From General Motors to one of your vendors when we have both the accounts,

16:30we just move them between our own accounts, basically.

16:32Loan documents we do a trade, all the paper, all the detail,

16:36all this notation, all the covenants, and

16:39all that can be kept in a place where you'll have the same files.

16:43They're all kept up to date.

16:44You know who owns it, you know who doesn't own it, so that would be one.

16:48Equity trading, I don't know the BitCoin takes ten minutes to finish.

16:53We do thousands and thousands of trades split second equities.

16:56So it may be too late to use for equity trading.

16:58It may be okay for end-of-day settlement stuff.

17:00So that's all use case by use case.

17:03You can go through one by one and say it'll work here, it may not work there.

17:06But again, you gotta kind of write the code, or effectively rewrite the code.

17:11>> So we then moved from one hot topic to another.

17:13You are part of President Trump's business advisory board.

17:16Should it have been disbanded, and

17:17where is that dialogue with the administration are taking place?

17:19>> Yeah, so I joined the council, just keep in mind.

17:24So when I joined the council, the President asked, Steve Schwartzman

17:28called up actually and said the President would like you to join his council.

17:31I am a patriot, I love the United States of America, okay, and

17:35you want to help your country, and I still am going to help my country.

17:39So help me God that is what I'm going to do whether or

17:41not you all like President Trump.

17:43And remember, we help presidents and prime ministers all around the world.

17:48I see them we advise them we give them this and

17:50we want to help the people of that country too.

17:52And that is part of your job as a bank and

17:54as a individual to try to help to make the world a better place.

17:57I joined the council, I did get one very long well written elegant

18:03nasty letter from my daughter, basically- >> [LAUGH]

18:07>> Basically, how could you Dad?

18:09And my other two daughters were right to the point, ditto.

18:11>> [LAUGH] >> And

18:13my wife told me how many of her friends she had to explain it to.

18:17Remember these are all liberal effete New Yorkers, in my opinion.

18:20>> [LAUGH] >> [LAUGH]

18:22>> I said I'm a patriot.

18:23It doesn't mean I agree with everything the man says or

18:26the way the man is himself.

18:27It's about trying to help the United States of America.

18:29The council met twice, so think of these councils.

18:32The truth is they aren't particularly effective.

18:35I was at one.

18:36I don't know if Mary was at the second meeting.

18:38All right and I think the same was a lot like the first.

18:39You talk about the infrastructure.

18:41You talk about this and the president is like, that's ridiculous.

18:43We get better at this.

18:44All true but at one point that work has got to be done in detail in the agencies.

18:49Okay, not by a bunch of CEOs sitting around the table,

18:52telling you that it takes too long to build a bridge and

18:55this regulation hurts and we need this in capital markets.

18:58So the effectiveness comes down over time.

19:00And then after, Charlotteville was the last straw but

19:03the negatives were going up.

19:05Most of us really believe in diversity.

19:07LGBT, DOCA programs, we're pro immigrant, we're and we certainly wouldn't

19:13justify any way shape of form, nazism or white supremacy or stuff like that.

19:18So we found ourselves having to explain to our own people by the way,

19:21because the press was always calling me up and saying you should say something.

19:25I don't remember the press calling me up saying I had to go public every time I

19:28disagreed with something Obama did.

19:30So the press really is extremely biased and

19:32they're going to have to do something about it.

19:34Not all, I mean they're all bias in their own way but

19:37having to explain it constantly over and over is just a negative.

19:39We had a conference call.

19:41Steve Swartzman was the chairman.

19:42He ran it, we went alphabetically,

19:44everyone on the conference call said let's just disband it.

19:47There were two said don't, having a seat at the table is a good thing etc., etc.,

19:52and we disbanded it.

19:53Of course Schwartzman told the President, and the thing that came out was that

19:57the President agreed to disband it which wasn't exactly the case.

20:00But everyone in that room is still working with the people they should

20:04be working with to help the United States government do proper things.

20:09They need help.

20:10If you think somehow decisions are going to be made properly in Washington

20:13without the help of business, they won't.

20:15We're all doing it in our own way and obviously, I do a lot with Monahan and

20:19Cohen And you have other people deal with other agencies, etc., but

20:23is you come up and try to help.

20:24And just because you don't like the president is a really bad idea.

20:28I think we become far too knee jerk in our politics and

20:32to me, you should be willing to help.

20:36>> Your name is- >> Sorry.

20:37>> Yeah >> Yeah, I'm sorry go ahead.

20:39>> Your name was thrown around a lot as a potential Secretary of Treasury.

20:42That didn't happen.

20:43But say you wake up tomorrow as the secretary, what does tax reform or

20:46economic policy look like on the secretary diamond?

20:49>> So, I don't want to be Secretary of Treasury.

20:51>> [LAUGH] >> But we have, and told you this is

20:55important this country has the best hand ever dealt any country in the planet.

21:01And most people don't fully understand if they never make the list.

21:04So I always say we have a problem, make a list and go through what we think matters.

21:08And I’m going to do it quickly.

21:10We have all the food and water and energy that we need.

21:12We have the Atlantic and the Pacific which our founding fathers realize how powerful

21:16it is to defend this country from wars in Asia, wars in Europe.

21:19We have the best military the world's ever seen.

21:21That's going to be true for a long period of time.

21:23I say compare it to China, but do it respectfully.

21:27China does not have enough food, water and energy, and

21:30it's neighbors happen to be Philippines, Japan, North Korea, South Korea,

21:35Indonesia, Vietnam, Pakistan, Afghanistan, India and Russia.

21:40And they've had border skirmishes or wars with five or

21:42six of those in the last 40 years.

21:44They are in the a tough part of the world.

21:46So those leadership there are saying God, we need food.

21:48We need access to certain commodities.

21:51We have to have an army just to protect ourselves from the billions of people who

21:55surround them that aren't necessarily that happy with them.

21:58So the United States also has and

21:59I got out of business school talking about Japan, Japan, Japan, Japan, Japan, Japan.

22:04Then it was BRIC, Brazil, Russia, India, China.

22:06Then it was Mexico, MIST Mexico, Indonesia, South Africa, Turkey.

22:10But none of them have what I'm about to say, the universities we do,

22:14the rule of law like we do.

22:15Low corruption like we do.

22:17The widest, deepest, most transparent markets the world has ever seen,

22:20public and private.

22:21And again, I'm not talking about banks here.

22:23Okay, and hugely vibrant businesses small to large, and

22:28innovation like the world's never seen.

22:32And I'm not talking about just Silicon Valley.

22:33I'm talking about you go to any company in America and

22:36believe me, they’re getting productivity up 2% somewhere, okay?

22:41And does Brazil have that?

22:43India, China, okay does most European countries have that whole list.

22:49Does Mexico have it?

22:50That’s the best hand.

22:52But something went wrong, and I do think we left behind a huge segment of sociaty.

22:5710 million people left the workforce, but I think they're starting to come back in.

23:0120 million people are felons, of which a large amount shouldn't be felons.

23:05I tell people if you were caught doing some of the shit you did,

23:09you'd be a felon too.

23:10And you can't get a job after that.

23:12Most companies, you’re not going to get a job with JP Morgan by law from most of

23:16the jobs by regulatory rules and requirements Scotty.

23:19We have the opioid crisis, I think we blamed trade immigration technology,

23:24but that's not really the reason.

23:26But we have some of these rustbelt towns left behind.

23:30Our inner-city school kids 50% don't graduate, okay?

23:34And most of you didn't go to inter-city school.

23:35But 50% don't graduate, they're mostly poor,

23:38they're mostly minorities in this land of opportunity.

23:41There are 6 million open jobs today, good jobs that you can get out of high school.

23:46Welding, construction, electrical, coding, automotive,

23:50there are automotive jobs everywhere, aviation, and we're not training the kids.

23:56So that's why and

23:57that's also why I took on the chairman of the business round table.

24:00So the question I always have is, how do you fix that stuff?

24:04In reality I think the fix is actually known.

24:06I think the hard part is getting it through Congress.

24:09But competitive tax reform has to be done.

24:13It shocks me that my democratic friends, and they say,

24:16are you going to change wages on day 1 of the 12 Corbett Tax Reform?

24:20That's their measure.

24:21What happened last time?

24:22That's their measure.

24:24The measure you should have is the counter factual.

24:27Had you had competitive tax systems 10 years ago,

24:30there would probably have been $3 trillion retained here.

24:33Companies and capital, 5,000 companies have been bought by

24:37foreign companies because it's advantages for them to own an American company now.

24:41So while our government dawdled on these inversions,

24:435,000 companies were acquired by foreign companies,

24:46net, there's a study that came out by ENY that would have been retained here.

24:49Think of corporate headquarters and we damaged ourselves and it's permanent.

24:54And that's 4 trillion overseas, and it's 4 trillion,

24:57someone has been reinvesting hard equipment in plant, and companies.

25:01But there is still 2.5 trillion in cash.

25:02That's why it is there.

25:04And it's not because these companies are moral, it's because it's so

25:06much more advantageous to do stuff over there.

25:08Microsoft built a research center in Vancouver

25:11because they can hire the same kids in Seattle because of our immigration laws.

25:16And so these things have held back America.

25:18And I am absolutely convinced and

25:19it's hard to prove it because you can't put a model.

25:22We're growing at 2% in spite of the dumb things government's done for 10 years.

25:26And had we done the right things around competitive taxes, infrastructure,

25:29education, we'd be growing at 3% or more.

25:33This recovery, the growth is half of a normal recovery.

25:37A small business formation,

25:38we're down net millions of small companies that normally would have been formed.

25:43And the reason is lack of access to credit, regulations.

25:46And again I can't prove it, I'm trying,

25:48we're using big data now to try to get some of the stuff looking backwards.

25:51And so part of the agenda of the Trump administration is the right stuff,

25:56infrastructure, education, competitive tax reform, proper regulation.

26:01All right, I'll just say proper as opposed to less or more,

26:04they massively overdid it.

26:06You've heard people say that didn't hold back landing, okay.

26:09And we did some real analysis and done by economist, not by me.

26:14Mortgages alone, we believe held back by $1-2 trillion because of the cost,

26:20lack of securitization, lack of servicing requirements and

26:24because of litigation, stuff around it that people are mostly mortgage under rise

26:28are willing to make mortgages to first time buyers, young people, immigrants,

26:33private defaults and self employed.

26:35Not going back to the sub-prime of the old age,

26:37just open up the credit box a little bit, okay?

26:40$2 trillion of mortgages would've been probably 5% growth in GDP.

26:44That one thing.

26:45And yet they say it didn't hold back lending.

26:47And that would not have changed any risk at all for

26:50banks, for the most part we don't keep that stuff.

26:52And it wouldn't have changed the risk for the government.

26:54Actually I think the risk is lower when the economy is stronger.

26:57And so that's what they should be doing and

26:58I think they are going to do some of that stuff I hope.

27:02>> Under your management at JP Morgan come from strength to strength but

27:06one instance stands out as a negative during your tenure.

27:09So, in 2012 a London based trader lost over $6 billion for the bank.

27:13Are there any lessons for us all on how you dealt with that incident and

27:17do you wish you'd done anything differently?

27:19>> Here is an example.

27:21This is what our country has come to, okay?

27:23We had a record profit that year.

27:26We're a big company,

27:27hugely embarrassed, and I'll tell you about that mistake in a second.

27:30No customers were involved.

27:33Okay, it was originally pronounced a hedge, obviously it didn't work.

27:37And yet we were punished severely in congress.

27:41$2 billion of fines.

27:43It's outrageous.

27:45It's just outrageous that a company makes a mistake.

27:48My shareholders got hurt by 6 billion.

27:49I hurt my shareholders, I apologize to my shareholders.

27:51And the government fines me 2 billion in addition to that, because they can.

27:55Because they said, it's another example of a bank being mismanaged etc.

27:58You know, shit happens!

27:59[LAUGH] And it was, we had put on a hedge that was supposed to

28:04earn a lot in a recession and basically break even in a normal thing,

28:10and lose money in a booming environment.

28:14Think is, we were short high yield and long investment, something like that.

28:17And it wasn't the complex derivatives that mattered.

28:19Because the fact is that wasn't the mistake.

28:21The mistake was when we put thing on, I thought and

28:26again I blamed myself and I went public right away.

28:28Big mistake, 2 billion, could be a lot worse.

28:31Bad strategy, barely vetted, barely monitored, barely done.

28:34My fault.

28:34I'm sorry.

28:35We're going to fix it.

28:37And the details in some ways didn't matter but there was this hugely liquid.

28:42This typical thing in trading by the way.

28:44When we had asked them to reduce the positions in half, I had asked.

28:48I'd looked at some very simple numbers has asked me.

28:50I should have asked a couple more questions.

28:52They couldn't do it.

28:53So instead of reducing it in half and saying we have a problem but if they said

28:58at that point in time we lost 500 million, you probably wouldn't have known about it.

29:02But instead of that, they kind of doubled down.

29:03They tried to come up with these old cockamamie ways to reduce the risk.

29:06But they just added more and

29:08more liquid positions on top of other liquid positions.

29:11And when you try to unwind that thing, that's how you get killed.

29:14But the lesson, there's no lesson to me.

29:16I knew the second it happened.

29:17I've seen it before.

29:18I got the whole Mazarin team together and all the PR people.

29:20I've said guys, they're going to come after us.

29:23They're going to say Jamie was like everybody else.

29:25Big banks are too big to manage.

29:27Jamie Dimon is a failure just like these other guys.

29:30He's off his highly holy horse, diamonds do break, diamond in the rough.

29:33I wrote all the headlines.

29:35>> [LAUGH] >> I said forget all of that stuff,

29:38we're here to serve companies, serve clients.

29:41We're going to do our jobs and hopefully the attack by the, and

29:43when something like that happens, and a lot of you have been through this.

29:47That is a letter to every AG, to every newspaper, to every senator,

29:51to every congressman.

29:53And they'll attack like literary like a bunch of barking hyenas.

29:57And yet we all look it like that's okay but it's not okay.

30:00It's not the way professionals, people should act when companies have proms and

30:03stuff like that.

30:04So the fact is, there was no great lesson learned.

30:07Other than follow you, whenever you have a problem and I say Zuckerberg's got one,

30:12that's what he going to deal with and I'm not sure he completely understands that.

30:16Every AG, every Senator, every Congressman, they'll turn immediately,

30:20they'll go on the attack, they'll take advantage of it.

30:22I'm surprised they are not talking about fining them billions of dollars yet.

30:26And so and that's just society, you just have to learn how to deal with that stuff.

30:29So and the biggest risk of all, the risk committees,

30:33we obviously bear risk all around the world.

30:37That risk committee which was meeting, had a senior risk officer on it.

30:41When I asked what about this trade, they said no,

30:44that trade was done pretty much between the bunch of those traders who

30:49were doing it, and Ira Sho who's our CIO who I respect.

30:54They didn't want to share the risk committee.

30:57That should never happen, ever, ever, ever, ever.

31:00Okay, our risk committees see everything, my general counsel sees everything,

31:03my head of compliance sees everything.

31:05Once someone ever says, well that we're going to do over here,

31:07you've got a problem.

31:09And that tends to create an issue that will come back and haunt you.

31:14>> To explore leadership in tough situations some more,

31:16the Harvey Weinstein's story is very much on people's minds at he moment.

31:19As a leader what do you feel is your role to play in creating a work culture that is

31:22very respectful of women?

31:23>> Well I think it is your role to do that and.

31:27And someone who said to me about that Harvey Weinstein, so

31:30Wall Street has been that way.

31:32Wall Street is not that way today folks, not like that stuff.

31:35I mean I'm sure there may be harassment somewhere at J.P. Morgan, but if you think

31:38it's condoned by anyone at the company in a senior position, absolutely not!

31:42Okay and we've got strict processes in place to look at what people do, and

31:47how they do it, and review it.

31:49And if it involved me in any way, shape, or form,

31:51it would go directly to a separate board thing.

31:54It wouldn't be like I could go negotiate a settlement on my own or

31:56something like that.

31:57So the first thing to Diversity, and I think it's more important

32:03than anything else is that everyone in the company is treated with trust and respect.

32:08Any meeting you walk in you feel like you're welcome.

32:11Anyone can speak up.

32:13You see the subtle guy thing.

32:15I've seen this, a senior banker once told me Jamie, watch this man who runs

32:19a big part of the company walk into the partner's room and he'll walk up to you.

32:22Hey buddy, how did you like that football game?

32:24Hey man, what was your score in golf?

32:26I mean, and he wouldn't even talk to the women in the room?

32:29If you're managing a group of people and

32:30I saw you do that, you'd get an earful from me.

32:33You've got to talk to everyone.

32:35You can like some people more than others, but you've got to talk to everyone.

32:37And you have to go out of your way to get the quiet person, the reserved person,

32:41the person who doesn't want to be embarrassed to get them to speak up and

32:45feel comfortable.

32:46And when you have an environment of trust and respect, people can shine.

32:50Okay, now you should have specialized programs and all that, and I'm for those,

32:53but they don't work if you don't create that environment.

32:56Doesn't matter.

32:57You just said you would advise it.

32:59I have three daughters.

33:00If they were in a terrible environment, I'd tell them to leave.

33:02Go find a place that appreciates your skills.

33:05And so it will hurt a company ultimately because if I get to pick my team from

33:09all people, not just white men, I would pick a far better team.

33:13I should point out that at JP Morgan Chase, and again,

33:15the press doesn't write this, half of my direct reports are women.

33:19Did you hear what I just said?

33:21Every article, even in the Wall Street Journal is always saying,

33:24it'll be 30 years before women represent 30% of the executive suite on Wall Street.

33:2850% including the head of tech now, Lori Behr, who's been doing a great job,

33:33she's been there a couple of months.

33:3520% of my direct reports are LGBT, because they're good.

33:42And 30% of all of the top 200 people in the company are women, and they run major

33:47parts of the company, credit card, private banking, global equity, capital markets.

33:53An Indian woman is the head of US M&A.

33:57And that was the most macho belt and suspenders,

34:01smoking cigar in the backroom of all the jobs.

34:05>> [LAUGH] >> And

34:06her father didn't even want her to go to school or college.

34:10She's actually from India.

34:11She actually Indian, and so, yeah.

34:13I think if you do it right you'll have a great environment for everybody.

34:16And you gotta have your eyes open to it.

34:19What I was worried about is not, we have 5,000 branches.

34:24And I just always know that in that branch, that guy or woman but

34:28mostly the guy, can be a bully and get away with it because we can't see it.

34:32And no matter what we say, the people in that branch, they need their job and

34:37they put up with it.

34:38Another one you shouldn't allow.

34:39And I'm sure you've been in companies, you should never allow, and

34:43it came to my attention, you are not allowed to have a golf event,

34:46invite the men in the division and not the women, just not allowed.

34:51My first inclination would be to fire someone on the spot if I heard about that.

34:55And don't have golf, do something different.

34:58And go out of your way to make everyone feel accepted, and

35:00you'll build a great company.

35:03>> One question we often ask female CEOs here is how they manage work-life balance.

35:06We rarely ask male CEOs.

35:08But I've heard a story that you once threatened to quit your first job because

35:10a partner forced you to work over the weekend unnecessarily.

35:13We're not suggesting that JP Morgan investment analysts stop doing the same.

35:16>> [LAUGH] >> But do you have any tips for

35:18us on structuring our time, balancing demands made of us, and

35:21sorting priorities?

35:22>> When I was an analyst at this consulting company,

35:25this consultant had said you've got to do this work.

35:27I need it Monday morning, 9 o'clock.

35:29He gave me the assignment Friday,

35:30which all the people in Wall Street complain about.

35:32The kids are right.

35:33MDs, they come in, partners, and they're not thinking about it till Friday.

35:37And on Friday, I need this.

35:38I need this, I need it Monday.

35:39Which means you gotta work all weekend.

35:40And most of the time you could have gotten the assignment on Tuesday.

35:43And so we've actually tried to institute some policies like you can't give people

35:47assignments on Friday basically anymore unless it's approved by someone senior.

35:50But I worked all weekend and then I show up at 9 o'clock.

35:54And I was in the library basically doing research and stuff like that.

35:57And he wasn't there and he called in at 12 o'clock or 1 o'clock and said, Robin,

36:01I worked all weekend.

36:02You said 9 o'clock, it was critical.

36:05He said I didn't really need it until tomorrow.

36:06I just want to make sure you got it done, to which I was, bye.

36:11>> [LAUGH] >> And

36:13I told him I'll never work for you again.

36:15Now this is not advice, okay?

36:18>> [LAUGH] >> My advice would be a temper is not

36:20a good thing.

36:21[LAUGH] >> [LAUGH]

36:23>> And they said, well,

36:24you can't tell the consulting firm who you're going to work for.

36:27I said yes, I can, because they can fire me.

36:28I was quite serious.

36:29I never worked for the person again.

36:31And I think that was a bully thing.

36:33That was my instinct, that was just bullying me, and

36:35it was completely unnecessary.

36:37And he knew me well enough to know that I was going to get down when I told them I

36:40was going to get down stuff like that.

36:42You can have work-life balance.

36:43When I tell people at JP Morgan Chase, it is your job to take care of your mind,

36:47your body, your spirit, your soul, your friends, your family, your health.

36:51Your job, it's not our job.

36:53So I think there's a little bit of misunderstanding that some of

36:56the companies.

36:56Now we should do everything we can to help you, right?

36:58I tell people, we give you medical, shrinks, Pilates, massages.

37:04I mean, we really do try to take care of people, but I can't make up for

37:07you not doing those other things.

37:09You really have to do it yourself.

37:11Most people don't work very smart.

37:14So first off, work smart.

37:15I do emails and phone calls generally once, okay?

37:19I have three types of reading, very fast, fast, very slow.

37:24So the very slow is the complex.

37:27I really need to think about it.

37:28Very fast might be a magazine.

37:29I just want to see if there is something interesting in there or

37:31something like that.

37:32People don't run their lives efficiently.

37:34And I'm sure you've seen even in school here, people are frenzied,

37:37they're always frenzied.

37:38They're late, they can't get back, I'm sorry I didn't get back to you,

37:41I couldn't get this done.

37:42I got my cases, I couldn't do this.

37:44If you're frenzied, it's you.

37:47It's not the school, it's not the job,

37:48it's you because a lot of us aren't frenzied.

37:50>> [LAUGH] >> I'm never late, almost never late.

37:56I'm not frenzied.

37:57I have a nice.

37:58I know exactly what people are doing.

38:00I schedule time for myself for exercise, and for making my phone calls.

38:05And if I didn't do it this morning,

38:06I would feel harried if I wasn't all caught up.

38:11So work really smart.

38:12Learn how to work smart.

38:14And then, in [INAUDIBLE] I think it's really difficult when you have children.

38:18That does burn the candle at both ends.

38:19My advice to men, is you better drop watching every football game and

38:23playing golf on both Saturday and Sunday.

38:26Do something with your kids.

38:28If you don't, it's neglect.

38:30Okay, you call it whatever you want, but

38:32I have a lot of friends complain that they have no family time.

38:34But they go play golf on Saturday and Sunday.

38:36I'm playing golf on Saturday and Sunday means you wake up at 7, right?

38:39You go play golf for three hours.

38:41You have lunch, usually a Bloody Mary, you go home and take a nap.

38:45>> [LAUGH] >> Okay, and

38:47then you go to dinner with friends.

38:49You should have done something with your family.

38:51And so you can do it.

38:53And if you're a woman, I think it's even harder.

38:55And I think there's some jobs that are really conducive to helping you, and

38:58some aren't.

38:59And you gotta think that through a little bit.

39:01And one of the greatest speech I ever saw a woman give was, you can have it all,

39:04you just can't have it all at the same time.

39:06And just be a little thoughtful how you manage your life.

39:07That could be a man who's gotta stay at home to take care of kids, or

39:10sick parents or something like that.

39:12And so it's a long race and you can pretty much do it all.

39:15But you gotta make sure you save time for yourself to do those things.

39:19And even the toughest job you can do that.

39:23>> In 2014 you continued to actively lead JP Morgan despite battling and

39:26defeating throat cancer.

39:28Many people were incredibly impressed by your decision to stay at the helm with

39:31the company during that time.

39:32What continues to motivate you under those circumstances?

39:35>> Well, it's not up to me to stand down with the company.

39:39You're never quite over with cancer either.

39:43At first, I had to go public with it.

39:44It wasn't my preference, but I couldn't be seen walking in and

39:47out of Sloan Kettering.

39:49And of course I was going to lose weight.

39:51I didn't lose my hair, but I could have, and all that.

39:53So I just went completely clean.

39:55I did go to work, almost every day.

39:58But that does not mean I worked every day.

40:01I mean I was taking four or five naps, I lost like 40 pounds and I didn't want to

40:05get close to anyone because your immune system is virtually gone.

40:08So I didn't even want to get a cold at that point.

40:10But people say [INAUDIBLE] so I was sitting at home and

40:15I go get my treatment every morning radiation and then I'd go home.

40:19I'd try to exercise, I went from running five miles to walking five, to

40:22literally walking for a minute, going on the floor because I was going to pass out,

40:27walking a minute, but it made me feel better.

40:30But if I stayed at home you know what I was doing?

40:33I couldn't read I thought I could read eight hours a day but

40:35I just couldn't do it but I was staying home I was watching ISIS and Ebola.

40:38[LAUGH] >> And when I go to the office,

40:43I'm surrounded by friends and interesting things and you keep mind well.

40:47I had some meeting and so it was better for me.

40:51And the board was fully beefed the whole time and

40:53I have unbelievable management team and they were great.

40:55And my family is great and so it was

40:59in some ways a heart warming experience other than the fact that it's terrifying.

41:03>> Jamie thank you so much, I think we'll now turn it over to the audience for Q&A.

41:15>> Thank you so much for being here Mister Diamond.

41:17At what level do you think BitCoin has to get to before

41:23JP Morgan would embrace it and at what level of demand?

41:26You said there is a level and

41:27I'm wondering what that would be as look today at the price of $7,000 a coin.

41:30>> I doubt we're going to embrace it at any price.

41:35So I mean to me it's that I'm worried about

41:38being caught up in this maelstrom of people losing money, and stuff like that,

41:42there's no reason for us to do anything with Bitcoin.

41:45Now, if you're a client, and you're going to trade it on the CMU,

41:48or something like that, I'd advise you not to do it, but should we do it and

41:52put in trades for a client who asked us, who is sophisticated,

41:55and obviously not bright, but sophisticated.

41:58Maybe, I don't know.

41:59I mean and I told the senior team I don't tell them what to do,

42:03I told to place a note to Daniel and

42:07I said Daniel I know you heard what I said, it's your job to what you do.

42:11And if you disagree with me that's completely fine.

42:13I'll probably do whatever he wants, inspite what I said.

42:20Hi, hello, hi thanks for coming.

42:24One thing, I'm I'm a second year MBA.

42:26A couple things you said that were quite interesting were that

42:30there is no lesson to be learned, and I don't care if I'm wrong.

42:33And I guess from a lot of senior leaders I've noticed that self-awareness and

42:36learning from mistakes or key characteristics?

42:39Do you agree, and if so,

42:40do you have an example of a time when you've actually tried to build those?

42:45>> Yeah, so I did mention mistakes I've made.

42:47I should have asked some more questions.

42:48There's one question I would've known.

42:52Just one.

42:53There's the one where I said it was a tempest in a teapot.

42:55I asked the question.

42:57I got the wrong answer.

42:58It was, how liquid are the positions?

42:59How many days can you get out?

43:01I was told ten.

43:03Yeah, it was like hundreds and the second I heard that, I said, shit.

43:07We have a real problem.

43:09So you learn. And

43:09I actually wrote about it in my chairman's lever.

43:11I said, lessons learned or relearned.

43:14I knew that.

43:14It's like you kind of sometimes learn the same lessons over and over.

43:17It's like being in a boxing ring, They say duck, hold your hands up.

43:20Yeah, well, That's harder to do than you think.

43:24So you do learn, you do get better as you get older in management and people and

43:28decision making.

43:29But I'll tell you what the biggest mistakes I've made are.

43:33They're not the specific one like the London Whale but

43:36more the patterns around it.

43:37Temper's a bad idea.

43:39Any decision made out of temper,

43:41even treating people with temper you They're always being careful.

43:45While you walk in, which mood is he in, and stuff like that.

43:48You don't get the best out of people.

43:49And sometimes earlier in my life, it was said, it was a well placed blow of anger.

43:53No, it wasn't.

43:54It was just a welling up of anger.

43:56It usually clouded your judgement, as opposed to.

43:59So, I knew I'd finally matured when about 10 years ago, I said,

44:04someone was sitting in front of me talking about something.

44:06It was about investment banker comp.

44:08And I was getting so mad.

44:10And I said, you know what?

44:12I'm going to leave the room.

44:14You guys stay here for ten minutes.

44:15I'm going to come back.

44:16I went out.

44:17I thought about what made me mad.

44:19I came back.

44:20I told them very politely How offensive what they were saying was to me, etc.

44:25But other mistakes, when you don't get the right people involved, plain and simple.

44:31Sometimes the answer is waiting to be found.

44:32You just have to get the people in the room to work it.

44:35Making decisions when you're tired.

44:37Making decisions on Friday.

44:41Not throughly vetting people, the biggest mistakes you make are people mistakes and

44:44I've made plenty.

44:45The people mistakes really set back an organization

44:48because it takes a long time to figure it out.

44:49And a lot of damage can be done, then you have to replace them, so

44:52it's like a year and a half.

44:53A person mistake takes a year and a half of setting the company back.

44:56And you may lose good people in the meantime

44:58because when you put a person in that job they often

44:59drive out some other good people by the time you figured out you made a mistake.

45:02And you can avoid that because I dont know your name but

45:06I can get the whole book on you and never meet you.

45:09Okay I can find out how smart you are, how you treat people.

45:11How you treat your friends, bosses, peers, subordinates, whether you're on time,

45:14whether you show up, whether people trust you, whether you shave the truth.

45:17I get that whole dossier on you.

45:19So we're pretty good now at making sure when we put people on these big

45:22jobs that we know they're pretty good.

45:23You still can make a mistake, but

45:25you'd be surprised, the error rate is just dramatically less than it ever was before.

45:32Hello.

45:33Hi. I'm a 2018 Sloan fellow.

45:35I was working for JP Morgan in London up until March of this year and

45:40I was just wondering where do you see the future of European financial services and

45:44particularly JP Morgan in the context of Brexit?

45:47So Brexit I mean the fact is we're going to be prepared for hard Brexit

45:52not because we're predicting, though I think it is pretty likely at this point.

45:55All right I think it's a very complex thing, it's not great for Brittain.

45:59But the fact is to be prepared all we have to do is have our European subsidiaries

46:03get more capital, certain licenses,

46:05certain approvals which we're going to get.

46:07So if you're had the hard Brexit it defaults the next day the existing EU law.

46:13Under existing EU law we simply have to do certain things contractually

46:17in sovereign in entities in the EU.

46:21And we have them we've got licences, proper subsidiaries and In Germany,

46:27Ireland, Brussels, it's only about 500 jobs, so it's not that big a deal, but in

46:33reality 12,000 people are servicing Europe out of London, even after a hard Brexit.

46:38And the real issue is what happens to the 12,000 in the 10 years after?

46:42Because I know it's going to happen Regulators and

46:45politicians are going to walk in and say we're uncomfortable.

46:48We know you did the license and

46:49you booked the trade of this subsidiary but you know back to back to that

46:52subsidiary to risk manage it where you have the banker do the ECM deal here but

46:57the research, risk, compliance, audit, trading was all done in London.

47:02And that's not sufficient we don't want to pretend we can grow this type of business

47:06you gotta move it here.

47:06I think there's going to be huge pressure moving those 12,000 people over time

47:10into the EU.

47:12And my goal is to make sure we conserve our clients none stop.

47:15It will cost us more money it's a real pain in the ass.

47:18But that's not the point I am worried about it.

47:19I want to be able to serve those European clients.

47:21And we bank every European country just about Every big European institution,

47:25every big European investor that's what I gotta worry about being

47:29prepared to do that on the next day.

47:33>> Thank you this is a continuation of what you're talking about, but

47:38what areas of the bank do you see most exposed to technology disruption?

47:44You mentioned sales and trading before Yeah so

47:46first of all like I said technology has been changing the world forever, so

47:50it's not like it's completely different.

47:51I think it's faster now, more money is going into fintech.

47:55Agile technology can do things that couldn't be done before.

47:58And I think it's incompetent upon any business to use technology to do a better

48:01for its client.

48:02Better could be better, faster, cheaper,

48:04straight through processing obviously making a digital mobile, stuff like that.

48:08I remember banks have been doing that for years and

48:09you can buy and sell effects on our on your mobile phone now.

48:12And when some trade, some trader did a $400 million trade and

48:16I said, God, $400 million on a mobile phone.

48:19I said we've gotta put breathalyzers on those phones.

48:22I just envisioned some macho trader having two martinis and saying,

48:26I'm going to do this.

48:27But you know what?

48:28When I mentioned that to the risk people they said, we do have that.

48:32And we can actually put that in, so that you can't do a trade without [INAUDIBLE]

48:34breathalyzer or something like.

48:36Anyway.

48:38So I think, in some ways,

48:39always look at a business from the standpoint of the client.

48:42So forget J.P. Morgan.

48:43A lot of the things the clients need, they're still going to need.

48:47In fact, they'll need you to go overtime.

48:49ECM will still be there, DCM will be still there.

48:51Hedging FX and hedging interest rates will still be there.

48:53M&A advice will still be there, but we have to use technology to do

48:56things better, faster, quicker like everybody else.

48:58And straight through and all that kind of stuff.

49:01But you ask me the thing that's going to be most disrupted,

49:03it's going to be payments.

49:05There are payment systems that you're integrating.

49:07All the HCh Systems, terrible.

49:09But we just put out a P2P.

49:11You all use Venmo?

49:12We just put out a P2P, it's realtime.

49:14Bank to bank.

49:16It's safer, it's better, it's realtime, it's not social yet.

49:19So I don't possibly understand why you'd want to share all that stuff with

49:22your friends, but could be that, it could be in wholesale payments.

49:26But you could go on screens now move money around the world,

49:29convert to different currencies.

49:30And so we're doing it, but

49:31if you ask me that's where most of stuff going to take place.

49:35Remember, we've invested in 100 Fintech companies and

49:38we're going to compete, build, buy, whatever it is.

49:41And just give you an example, we're going to have online trading and

49:45mobile investing for our clients.

49:47It's in beta today, I'm not sure I'm going to roll it out.

49:49We're going to roll it out and test it and test price and all the stuffs like that,

49:53but we can analog those things for free if we wanted to.

49:55So we're not, we're not dead in the water.

49:58So when the time comes, you are going to see us being very aggressive to win

50:01businesses like we always have.

50:05We rolled out, it's not being marketed, we rolled out a mobile-only bank in St.

50:10Louis recently and we are going to test that.

50:12More for millennials than anyone else, but from opening the account to moving money,

50:15it's only a debit card.

50:17And we're going to see how that works and

50:19then we are going to try to modify that and then do it in all 50 states.

50:24Go ahead.

50:25They'll get it eventually.

50:26No, hold it up.

50:28>> Jonathan Walden, third year PhD student now and

50:31I have a question about how you brought up bureaucracy and

50:35politicalization, and the detriments that does to the firm.

50:40And my concern is how do you assess the bureaucratization within J.P.

50:45Morgan, compared with your peers.

50:47And how do you trade off the agency that you give to individual portfolio managers

50:52with the oversight from compliance?

50:55Well, we're pretty rigorous how we run the company, so we meet all the time, and

50:59go through everything top to bottom, and we raises issues and stuff like that.

51:04So you know who your authorities are if you're a trader.

51:07If you're a bank, you know exactly.

51:09You also know he's not supposed to do, and you also when

51:11you go to compliance committee, risk committee, an underwriting committee, or

51:14a credit committee, there's no mystery to any of that.

51:16And it happens every day and we barely make mistakes.

51:18And I'm not going to stand behind the regulatory things, and we have a thousand

51:21new rules and regular requirements and that does create some of the bureaucracy,

51:25but it's not an excuse for us to say, this is a better way to do it.

51:28We listen to customers all the time.

51:30The management team is open, every issue, the agenda is always set by them.

51:35So it isn't like you walk in the room and I set the agenda.

51:37If you work for me, I expect you to raise everything important.

51:41Everything and anything including bureaucracies,

51:44cost slow down, bad service, competitors got something better than us.

51:48That's your job not my job and, so I mean,

51:51I do it with you hoping presumably you're going to do it with your management team.

51:53So you're always airing all this issues.

51:55We go on bus trips, we go to call centers, we go to op centers, we got client

51:58reviews, we got advisory groups, and all those things get circulated all of them.

52:03So all the complaints we're always trying to deal with that

52:06become better and faster.

52:08I think one of the tough things about management is

52:10you have to get rid of the bad people.

52:13So I can say anything I want, but if I have a bunch of goomas,

52:16or they're not that good, or they're friends of Jamie type of thing.

52:21That is what caused the problem.

52:23And so very well from people who were on going to get rid of the bad people.

52:26Bad could be, because their culture is bad and also because they're not good.

52:29They're not good enough.

52:31So in meritocracy people say, Joe deserves the job or

52:35good old Joe and spending a long time.

52:37That doesn't mean they deserve the job.

52:40And in sports if you're not batting 250 you're not going to be playing

52:42second base.

52:44And it's very easy, you take out a pitcher that's not doing a good job.

52:46In business there are left in those jobs a long time.

52:48I'm not saying treat them disrespectfully.

52:50If you treat people disrespectfully,

52:53you're going to lose their hearts and minds too.

52:55So it's gotta be a very respectful, we're going to make a change for

52:58the following reasons.

52:59But you really,

53:00if you're going to run a real meritocracy, you've gotta make sure you really do it.

53:04And those people, it should filter through the whole company.

53:08Loyalty is such a misnamed thing sometimes.

53:10What they usually mean is, I was asked when I was a young CEO in a room like

53:13this, we had just done a big deal,

53:15how can we be loyal to you when you weren't loyal to Joe?

53:17He's been around.

53:18He trained a lot of people in the room and you just demoted him.

53:21I couldn't answer the question.

53:22And I called the person the next day, and

53:24I answer every question eventually by the way.

53:26But I called him the next day and I said, I thought about it and

53:29you got it backwards.

53:30If I was loyal to Joe and kept him in the job.

53:33And most people thought he just wasn't doing a good job anymore.

53:35Who am I being disloyal to?

53:37Everybody else and the customer.

53:40And so it's a hard thing to do but and

53:42that's the hardest thing to do in management right there.

53:45And a lot of you will fail doing it, because you deal the thin hams in

53:48management, you're owned by this desk down the hall and they all take care of it.

53:51Don't worry I'll take care of it and basically that becomes a club.

53:55And they're not taking care of it for the company or the client.

53:58They're taking care of it generally for themselves.

54:00And so you have to be very, very careful in management, why you're doing what

54:03you're doing, and who gets to speak up and who's in the room and things like that.

54:08>> We got time for one more question.

54:13>> So I worked for J.P.

54:14Morgan Chase back in 2012, part of the team that redesigned the chase.com.

54:18So I do know Chase is always more towards the technically advanced company.

54:22And this question is more toward the tech side.

54:25What is the stand of backing community in AI, artificial intelligence?

54:29Like AI is going to take over automation stuff.

54:32>> Yeah. >> And what does

54:33banking community thinks about it?

54:34>> Well, I don't care what banking community think,

54:36I'll tell you what I think.

54:38[LAUGH] Big data, AI, machine learning, chat boxes, roblox, they're all real.

54:43We have thousands in data scientists and PhDs and not just coding.

54:47And we spent $9 billion a year in technology, $700 million in cyber,

54:51probably $1 billion a year now and

54:54just some of these stuff just uniquely devoted to that.

54:57And it is real it is an amazing thing that you can do, that you can do today in

55:00a split second so we just to, when you swiped that credit card,

55:03it goes through hundreds maybe a thousand algorithms to test for

55:06fraud how you did it where you did it what time.

55:08We do the same thing for big payments.

55:10So if you run a company, small business large company,

55:13like what happened to the Federal Reserve never happened to us.

55:15Payments at the wrong time, different type,

55:17different entry, we're actually monitoring your systems all the time.

55:20If we see anything wrong we're calling you up and stuff like that, so it's real.

55:23The hardest part about it isn't understanding it or knowing

55:27the technology, it's getting the people in the company to understand the power of it.

55:30So when we first started big data, and big data and we put it up at the central for

55:35standards, and we used Hadoop.

55:37To make sure that you don't end up with 84 different platforms and

55:40stuff like that out of control.

55:42And machine learning has another problem with regulation that I won't go through

55:45but we put it at the top.

55:47And we had to say, hey, you do prospecting, how do you do it,

55:50why do you do it?

55:50We made prospecting ten time more efficient in a commercial bank.

55:55Ten times and don't think, okay, the cost is lower, instead of $30,000 it's $3,000,

56:00it also means we can put two more bankers in Grand Rapids.

56:04It's a huge benefit to the company, and

56:06be immediately productive as opposed to take three years to build it up.

56:09And then once we did that, we now have it in every division.

56:14So every division has a big data, AI, machine learning thing.

56:17And we ask every manager, come back and

56:20give us the use case that you think is best for you.

56:23The demand is going up like this.

56:24But it's one of the areas you want the demand.

56:27You want to spend more money.

56:28Obviously, you want to spend it wisely but we push people.

56:30So in technology, I always do that.

56:32You can't ever say to me you didn't do it because of the budget or

56:35you couldn't afford it.

56:35it is not allowed, you have to put in your budget sort of a reflection of

56:40a 12 month of a plan, you have to put in a plan everything you need to do.

56:45Going to sales force,

56:46going to companies going to technology, do not be a baby about it,

56:49because people say, well we did not do it, because we could not afford it, who said?

56:52We can afford anything we want.

56:54We spend $58 billion a year, we make $35 billion pretax,

56:57if you guys put on the $2 billion to get big data right, we're going to do it.

57:01So it's more about the getting executed right than it is about the money.

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

57:07>> Thank you very much.

57:08>> [APPLAUSE]

57:13[MUSIC]

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