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tv   Bloomberg Businessweek Debrief A Conversation With Jamie Dimon  Bloomberg  December 27, 2016 4:00am-5:01am EST

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yousef: these are our top stories. starting off with what is happening, of course, in italy, where the italian government is set to invest 6.3 billion euros in monte dei paschi, according to newspaper "il sol," which did not name it sources. the european central bank said monte dei paschi may need a capital increase of as much as 8.8 billion euros, based on the results of a recent stress test. toshiba says it may have to book a write-down on its u.s. operations, amounting to
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"several billion dollars." the company says it expects it will have an impact on earnings. shares in the first suffered the biggest decline in more than a year, down 11.62%. barack obama says he could have beaten president-elect donald trump, if he had run. axelrod,to cnn's david obama said hillary clinton had perhaps played it to save during the election campaign. trump fireback on twitter, saying "no way." profits at industrial firms in china accelerated in november, rising 5.5% from a year earlier. raw materials producers let those gains, with prices of products such as coal and metals continuing to advance. defendant -- japan's consumer prices dropped a ninth straight month, following zip -- falling 0.4% from a year earlier.
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it is worse than the 0.1% that had been forecast. is facing ajapan challenge stoking even a little bit of inflation. the markets, this is what we are looking at in terms of the weei function, to give you that beautiful overview. there is some optimism coming back into some european indexes. the ftse 100 and u.k. markets are closed today on the back of that holiday. we are looking at the imap function, the breakdown of what we are seeing in the financials, under pressure. let's get you up to speed with what we are looking at in some of the other global markets, because we are seeing, again, pressure on some of these indexes, specifically when it comes to the dollar-yen trade. dollar strength returning a little bit, up 0.1%. look at what is happening with gold, which has been accelerating the last few hours. 1% higher.
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the unitede -- states, its tenure paper still 2.55, and stable, at u.s. futures, a mixed picture. stay tuned for much more. this is bloomberg. different -- a decade after the global financial crisis, jamie dimon has emerged as one of the sought after voices on banking. i sat down recently with him in detroit, michigan, to talk about the motor city's economic recovery, to discuss whether strategies used here could be replicated elsewhere. he will not be a member of president-elect trump's cabinet -- >> i do not presume to be secretary of treasury -- >> he said he could affect trade. >> you consult problems.
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>> that is all coming up in the special debrief, a conversation with jamie dimon. let's talk a little bit about more recent news first. i'm sure the audience is as interested as i am. there is conversation about a potentially going into the administration as treasury secretary. did you turn that job done? inie: i'm quite public saying i do not think i do not think i'm suited for secretary of the treasury. i can add a lot of value through what i am doing. megan: there we go. that is the answer. when i look now, as recently as september, when you were talking about what you thought the next administration would be, and this was before the outcome of the election, you id you thought it would be difficult for wall street guys to get confirmed and get in. now we look at the landscape we have. we have several wall street figures, some of who you know very well, including gary cohn,
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from goldman sachs, rex tillerson from exxon mobil, steven mnuchin, what do you think they will bring to the administration that is different? what is news that they are going to bring in terms of experience? is this a good thing? jamie: i was dead wrong that you will not see a wall street person in washington anytime soon, but you had a complete -- -- a complete upheaval. the republicans are in charge, and the republicans have not been antibusiness. you have largely seen the democrats be antibusiness for years. if you are going to be president, you should have the best people sitting around the table. i think it is a mistake that working for an oil company makes you bad. you want the best team. and so, you know, honestly, i think it is a good thing because a lot of these people are qualified people who are patriots who want to help their country. they are not going to try to help their former company. that is not what they're going to try to do. these are people with deep knowledge who hopefully will do a great job. megan: when you look at that
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shift in terms of wall street, this is a reset moment for the industry more broadly in terms of what the american people are expecting or what they are likely to see? it is a reset moment for how business is going to be treated. i've always believed -- 145 million people work in america, 125 million for private enterprise, 20 million work in government. we hold them in very high regard, firemen, sanitation, police, teachers. but, you know, if you didn't have the 125, you couldn't pay the other 20. so i think business is a huge positive element to society. and for years it has been beaten , down as if they are terrible people. i think it is a good reset. detroit is a perfect example of civic society, not for profits, government, business working together to improve the lives of american citizens. so, yeah the reset has the , chance to do the same thing. if you can duplicate what you are doing in detroit and around the country, you will have a huge renaissance.
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megan: let's talk about that. you travel all around the country and all around the world. what we are seeing in terms of the economic populism that drove this election, drove things in europe. when you look at this, what is your diagnosis from your travels and your experience about what is going on and what is driving this explosion we have seen, this economic angst that people feel, their dislocation from society, what do you diagnose it as? jamie: a lot of people have tried to diagnose why it happen, the populism and all that. if you dig into the numbers, it wasn't anti-immigration per se. it was fear that america was changing too much, but it wasn't anti-immigrant. most of us are children and grandchildren and great-grandchildren of immigrants. it wasn't even anti-trade, but i think at the core of the matter it was a frustration and an anger because of two things. middle-class incomes have not grown for 15 years. you look at the facts, they are
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-- usually, when you hear facts like this, they are just dead wrong. people don't analyze them, how things happen, but this happens to be true. the second one is that low-skilled, think unskilled are -- unskilled and skilled have been growing over time. unskilled is having a hard time with a living wage. i think that those two things are true, but you need to diagnose why it happened. it did not happen because business is bad. there are millions of reasons to come up with, technology, etc. and there are solutions, solutions, i would say, around training, work skills initiatives. i would greatly expand the earned income tax credit so if you're making eight dollars or nine dollars an hour, think of it as a negative income tax. even if you are single right now, we do it for mothers and -- -- mothers with babies, we don't do it for single men. it gives you a job, a living wage. it helps small businesses. it is not necessarily good for big business. but i think it is a wonderful thing to do for society. i think there are solutions that you can have.
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i think you can fix corporate taxes immigration, trade, all , done properly, we will have faster growth in america and help fix those problems. unfortunately, a lot of people who talk about these problems, looking into the problems, they think they can beat up on business, as if that is what will make it better, which it is not. megan: you have announced you are taking on two roles. you will be chairman of the business roundtable and on a group advising the president-elect on business policy. when you look at those two roles, which are separate, what are the initiatives you think he is going to need to tackle first, and what do you hope to advise him on? what do you hope to steer that direction toward? jamie: anyone who is president, i'm a patriot. i have always offered my help. i did to president obama. i will to president trump. i'm in a group of 15 people that has not met yet, think of ceos and a bunch of other folks, and what i have heard is he wants it , to be about jobs and growing the economy. so be specific about that.
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and hopefully, we will have good ideas not just people talking. , the business roundtable, if you look at america, we have the chamber of congress, who advocates on behalf of business large and small with 25,000 members. companies, principally representing large companies. if you take the fortune 500, the s&p 500, half of all capital expenditure is in the -- in the united states, they've a tremendous money growth. they are philanthropic. everybody gets medical benefits. we take care of our veterans. we do education. we do schools. we want to have the country grow. so i think the business roundtable can take a proactive approach to help solve the nation's problems and be part of the solution. that's why i took on that challenge. but when you talk about, specifically, we need corporate tax reform. we are driving capital overseas every single day. and, you know, i think the government made a mistake to act like inversion was the problem.
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the problem is our tax rate is so much higher than the rest of the world, and the rest of the world has been coming down and ours has stayed level. because of that, companies are leaving their money overseas, to reinvest it overseas and buy companies overseas. the only question is how much damage will be done before we change it? every study shows that reducing the corporate tax rate helps lower paid people and wages. so, you know to me, we should , solve the problem, and i hope the new administration can do that. megan: just ahead, dimon sounds off on populism world wide. jamie: they want a wrecking ball brought to these governments. they want change. megan: and what he expects to see on american immigration policy. jamie: we are not going to kick 11 million people out. ♪
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megan: you also talked quite vocally in recent weeks and years about education, immigration, and infrastructure, and the parts that those will play and how much you will spearhead those initiatives? jamie: one of the greatest disgraces in this country is the fact that in a lot of these schools that 50% of these kids don't graduate in high school. even those that graduate are not necessarily job ready. i look at that and say that is a crime. that is a disgrace. that is america at its absolute
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worst. we are allowing it to happen. and these kids don't have opportunity, and they don't have the opportunity we all had at one point in life, and we have to fix it. when you hear the government say make this free. it's not whether it's free, but whether it ends up that you are properly trained for a job. if you go to germany, for example, 2/3 of the kids go to vocational schools that work with local businesses and they get a certificate that leads to a job. even in new york city, there is -- you probably do not even know this. there is a school called aviation high school. the graduates of thousand kids a year, or 500 kids a year. kids travel from all over the city are trained in how to maintain small aircraft, electronics, hydraulics, and electrical systems. when they graduate, $60,000 a year, everybody gets a job. you can do that in robotics, coding, accounting, a lot of health care fields. there are another 20 i can't even remember to list. that is what we should be doing. it doesn't mean you cannot go to college.
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it just means you get an education that leads to a job. it has to be done with local business. not a government program. if it works, local businesses will pay for that. i have been at focus hope, that -- you are doing it here. that is something we can do that can create jobs for people, and that has a huge amount of social benefits. infrastructure, we need to do, and you mentioned it. and immigration, there is a great bill passed by the senate called the schumer-mccain bill, proper border controls, allow -- of course, you want to control your borders -- that allows educated individuals who went to american, got advanced degrees in science, technology , engineering, and math here to stay. i think we should let them stay and let them build their careers and homes. 40% of the companies in silicon valley are immigrants, russian, indian, german, and then have some kind of path to citizenship. it is very tough. it takes like 15 years if you are a good law-abiding taxpayer
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here, but not a documented immigrant, then you have a path to become a citizen behind everybody else, and look, you -- we are not going to kick 11 million people out. i think it is rational, reasonable, and responsible thing to do. i understand why people want border control first, and we should do that too. all these things could be done, and they just haven't been done, and it is a shame. megan: when you talk about immigration, and you said we are not going to deport, we are not going to kick 11 million people out, some of the rhetoric has talked about these types of things. is j.p. morgan, are you and other businesses in the roundtable going to be the voice that says we need a much more pragmatic solution, we need a way to keep the people, particularly for the jobs we need, and frame this as an economic argument, and argument, -- as a growth argument, and as a jobs argument? went to the
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president-elect, and i felt that for j.p. morgan chase -- i felt that if you are black, jewish, lgbt, african-american, woman, we will support you in the kind of diversity the way we did before. that will not change. the rhetoric seems to have gone away, even the rhetoric about immigration. president-elect trump is sounding a lot different than candidate trump. he now says if you break the , law, we will deport you. undocumented, they estimated that only 800,000 of -- broke the law. that is the current policy of the united states. president obama deported 2.8 million people for breaking the law. but absolutely, the business roundtable has already supported immigration for that very reason. it is a pro-jobs and also respectful. the fact is that most people who get worried about immigration, it is not that they don't like immigrants. it is more -- you look into it, it seems like they are more afraid that the american way of life is changing. you could be multicultural, but still support the american way of life. you remember abe lincoln, "we
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are here to rededicate ourselves to this nation conceived in liberty and dedicated to the notion that all people are created equal." this is the only nation on the planet that was an idea, a vision. it was a value. it was not a tribe. a lot of people want to make sure that does not change, and some people are confusing multicultural with somehow we will change, that we won't tolerate different religions, that we won't tolerate different opinions, that we won't tolerate a free press. you can support that and be multicultural. megn: but also, when you travel in sort of europe, where this is also a deep phenomenon, we see it in italy and germany. we see it in france. we see it in the u.k. to be sure , obviously with brexit. , do you think this is a temporary phenomenon in terms of how people are feeling? do you think it is a generational phenomenon? do you think it will weed itself out or you think this is a permanent movement of people
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who are more focused on redrawing national borders, national identity, regrouping around that in what has been a decade of constant disruption -- more than that. two decades of constant disruption across so many stabilizing forces in their lives? jamie: when you look at something like brexit, there were completely different forces for brexit. somewhere anti-immigration, open -- some want open and free trade, all these people voted for different reasons. i do think i think if you go to britain, thereof is the same frustration on income inequality, growth in wages, lost jobs. if you go to parts of europe, 25% -- not the u.k., not germany -- 25% of people between 21-35 are not working. is that a sustainable thing if you have another generation of that? so i think there is a legitimate frustration. what is that, how did it happen? a lot of it is government policy.
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so there is frustration. a lot of you saw in america and overseas, i want change. they want a wrecking ball brought to these governments. they want change. they were not necessarily voting for a lot of things people said. they want something different from what they have seen. a lot of us are sympathetic with that. we want to see something different. we want things to be better. again, you ultimately need to have facts, analysis, and detail to make that happen. populism itself can be very destructive. destroy things -- look at venezuela, argentina going the other way. the other thing about europe, just keep in mind, we talk about all this disruption, europe had, since world war ii, peace. they did not have peace for 2000 years before that. so there are benefits that people are reaping. maybe they forget about it, but it is important to have peace in europe. megan: when we come back, a look at detroit's turnaround. jamie: so this has been a train wreck that we all knew was coming for about 20 years. megan: and how the lessons of the motor city can benefit others. ♪
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megan: we have talked a lot about how getting things done and government policy isn't structured to get things done. let's look at detroit with a -- and what worked here, and what you guys have done with a $100 million investment over two and a half years. when you talk about this, when j.p. morgan talks about it, when the mayor talks about it, it is a lot about nonpartisanship.
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that is what echoes through. people are coming together and it's not being driven by policy. -- policy differences between people. how is that working, how does it work here? was it just that it was in this situation where it could work? do you actually see that being able to be replicated on a more national level? jamie: the detroit effort started when i went to see lee saunders, who was saying bad head of the union for municipal workers who was , saying bad things about j.p. morgan. i walk in the room and say, what are you saying? he said, i don't know. i don't know why we were saying that. we think you guys are a great company. we hit it off and he started telling me about the problems in detroit. i immediately left that meeting and called up peter. it is the people in this room who did all the heavy lifting. we know a little bit about the mayor. we had a mayor, door-to-door, a white man in a mostly black community got elected, and he was talking about what you need in detroit. we need the streetlights on. we got them on. all 65,000. i first came here, and 30,000 didn't work.
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and the first city with l.e.d.'s. we need jobs. we need affordable housing. we need housing for commercial markets. we need training, skills. we need -- last night, we did a thing for the entrepreneurs of color fund. 30 businesses who were helped by this fund, and they are somewhere in this room, and they're doing training. trucking. i think one of them worked on your light project here. that was a big thing that they did. restaurants. this mayor had this huge set of problems. and it isn't like best people say, what is the one thing you are going to focus on. he had to focus on all of them. it doesn't work to do one. he had to get hope back, bring businesses back, training, schools, police, sanitation. the sidewalks. and with a smile, this man with a smile, set up all these things, likely would have done in business. the war room for the lights, the war room for the sanitation, constantly tracking it all, and it is working. and it was because of the mayor, and the governor too by the way, one republican and one democrat,
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and just so you know, i don't care about democrats or republicans, ok, but what is going to make this work for society? we were all in. we did not just come here and throw money at it, which is easy to do. philanthropy can often be wasteful. the team came up, peter and the team and asked, what do you , need? they needed for example to get rid of 70,000 blighted homes. they needed to get rid of them, but they didn't even know where they were. someone came with this idea and we funded it, take a picture and geo-locate every home. now 10,000 blighted homes have been shut down. they can plan and start selling homes. he has them on his mobile phone right now. so we want to be an accelerant. we wanted to get things moving so you can build here and get people into it that helps the whole community. if you can start with entrepreneurs, that helps the whole community. if you- so can starte try to do everything like venture capital that helps us get going, get growing working with the
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, governor, the mayor, all the civic unions, the non-for profits. there are a lot of things you do on the ground that we could not possibly do, but partning with you, with our people we also had , our people come through, 68 people working on projects for 20 non-for profits. they need help. we gave them data, alytics, money, advice, consulting, all the things you need to get these things off the ground, so it has been a fabulous effort. and honestly, without a mayor like this, it would have been a total waste of time. megan: the mayor told me that the 65,000th light is going in tonight, so it is quite an achievement. why is doing something like this good business, a business issue, good business, why is this good business for j.p. morgan and detroit? jamie: obviously it is not that , we lack the morale. we are the largest bank in detroit. we were the national bank for
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-- national bank of detroit, for those who don't know started by , general motors in 1934. most of the banks were closing in the depression, general motors needed a bank in detroit, that bank merged with first chicago which merged with j.p. morgan chase, so here we are the largest bank in consumers, small business, middle market, all major institutions, hospitals, major companies here, and the government, so it is an important town for us. it is probably one of the only towns in america that did not have a renaissance in the 1980's, 1990's, 2000's, so this -- when most other major cities did. so this has been a train wreck that we knew was coming for 20 years. it shows you the worst part of bad public policy. you can throw money at it, and unfortunately it took a train , wreck to happen to bring in the mayor with the skills to get this done. once we saw that obviously we can help the city, and it helps
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business, it could be a shining example of the right way to do things in society, and for us, it was a little bit like if we can do this here, remember, we bank here. we need a healthy, vibrant bank. this is an extraordinary effort. we can do it elsewhere too and help these communities, and it is good for society, and obviously very good for business. megan: in terms of when you look at doing projects in detroit, the projects have been designed to be jobs and center around economic opportunity, expanding that, and making these neighborhoods and revitalization where people can walk to work or they have easier access, starts with families, homes, jobs, is that replicateable on a larger scale? even just the lessons you are taking out of detroit? jamie, yeah, i mean if you travel around the world and see all these things, singapore does it. it is a country. when it was formed, it was part of malaysia, but when it was formed, it was partially chinese, malaysian, and the -- and partially indian. it spoke those linkages. the prime minister came in with
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the vision and strength to get it done. it's gdp is now higher than the gdp of the average american. the prime ministers pretty tough. he made them all learn english, good for companies. he made sure the streets were clean. they have a lot of affordable housing. but he made sure that you couldn't live, like there wasn't an indian building, a malate building, alay chinese building, not just by building, by floor, by apartments, he wanted them to know each other's kids, smell each other's food. i tell people, you put some of my liberal democratic friends in charge of singapore, it would still be a backwater. you can't force people to live where they don't want to live. you can't punish people for spitting on the streets. you can't make people learn english. that is what would happen. people have to think policy. what works and what does not work? here, it is the same thing for other countries. i just mentioned germany's vocational schools, germany is doing well in europe when most countries aren't.
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you learn these things when you go around the world, what works and what doesn't. you can write books about venezuela, ecuador, argentina, cuba, north korea, what did they do? largely populism. the ones that worked -- south korea, no natural resources, unbelievable story. singapore, no natural resources, unbelievable story. i can go on and on about what works and what does not. for some reason we don't learn these lessons. i worry about bad public policies causing constant damage out there. and, you know in america, you , keep hearing that productivity is low, it is secular stagnation, it is a new normal, it is just not true. we have had multiple wars. we are not educating our kids. we have government shutdowns, badly spent money, failures in the health system, an extreme amount of regulation, that is why we are going slow. it is not the economic model. and i just find people are looking for simple answers, and sometimes there aren't.
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so all these things are fixable. megan: up next -- jamie: business has to have a se at thtable. megan: dimon's thoughts on the role business can play in the new administration's push for change. ♪
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>> good morning. you are watching bloomberg. these are the top stories we're watching. the italian government is to euros in3 billion monte dei paschi according to the newspaper that did not name it source. bank shares will remain suspended today on the milan stock exchange. theyean central bank said may need a capital increase of as much as 8.8 billion euros, it may have to booka recenttoss a right on its nuclear operations to "several billion
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dollars." the company expects it will have an impact on earnings. earlier shares suffered their biggest decline in more than a year. barack obama says he could have beat the president-elect, donald .rump, if he had one speaking to cnn he said hillary clinton had perhaps played it too safe. trump fired back on twitter saying, no way. at industrial firms in china accelerated in november, rising 14.5% from a year, compared with a 9.8% increase in october. raw materials led those games with prices of coals and metals continuing to advance. household spending fell 1.5%, worse than that 0.1% that had been forecast.
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it underscores the ongoing challenge that the bank of japan is facing in stimulating inflation. let's cross over and show you what is happening, a good overview on what is happening in some of these markets. i would like to point out to you, the average volume, the 10 year delta, you can see how many people are still on holiday, to the soon desk tune of 70% to 75% lessne of 70% to 75% volume. on the dollar-yen front, we have seen dollar strength return. watch out for what is happening with crude. it has not really been able to make up its mind, currently on the downside at $55.15. it is the longest winning streak in some months.
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be that's apears to bit overdone, the selling. one to watch. this is bloomberg. ♪ megan: and the new administration with a cast of characters that is different from any administration, is it possible to unite this extreme division, and particularly on issues like infrastructure that we have tried to get in the country for two decades, tax reform, talking about regulation as well. d you think you will be able to lead and business will take a bigger role? jamie: business has to have a seat at the table. infrastructure is not going to be built properly if it does not.
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happenng is not going to if businesses do not work with schools about what kind of jobs they need, so i think this will be a huge positive element in designing and infrastructure plan that democrats and republicans agree with. , let'socrats oversimplify, just spend money, spend money. a lot of it goes out on bridges to nowhere. it is a little bridge and harvard business school, five years being rebuilt. it is corruption, folks. do not tell me it is not corruption. so the democrats are right, we need infrastructure. we do not need it to create jobs. you remember the milton friedman story, they were in asia building a highway and they have these machines in the back that they are using shovels. he said why don't you use the machines? .t is a great question, jobs
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in that case, why don't you use spoons? that is kind of the democratic mentality. it itl create jobs, but is a bridge to nowhere it will waste money. if it is a bridge to somewhere it is conducive to growth in the long run. republicans are right to be questioning how money gets spent. say,are going to want to who is doing it, how is it being done? , lot would be to give back that this mayor knows how to do it. we do not want washington telling the mayor what he needs. he knows what he needs. there are things to be done. i think business can bridge that because we are a watchful eye on wasting money. megan: do you think we have done a good enough job in explaining to people that part of the fundamental disruption they will ,ee is this move to tax automation, that many of those jobs including in places like
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detroit and places where we saw a heavy swing, pennsylvania, ohio, michigan, wisconsin, that those jobs are gone and they are likely not coming back, and training people for the kinds of jobs, the mid and upper skill , every doing a good enough job explaining that to people? jamie: we are educating people about something the wrong way. technology is the greatest thing that ever happened to mankind. until we had agriculture, we would still be in buffalo that eating buffalo and living in tents. -- eating buffalo and living in tents. we went from fire to wheels to steam engines to these wonderful phones we have in our pocket now, which can do things you'd could not even imagine. this is the reason mankind is living the way it does today.
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i am not going to deny the problems we have, but we would not be living the way we are today. when my grandfather was born, there were no cars, planes, no health care. if you got sick, you died. 120 years later, it is pretty good over that time. mankind has gotten better and better. there is a book that actually analyzed things like people that were murdered at the hands of other people. that number has been coming down every single century the last 20 centuries, including last century which included world war ii. in spite of what you read in the paper, and kind is slowly mankind is slowly learning how to get better. technology drives it. we did a bad job helping the disruption so what we need to do is say, let's not hold back technology. let's use it to help mankind.
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40,000 of people die a year in cars. it will be a good thing. not a bad thing. warren buffett talks about 11 million people working on farms 50 or 60 years ago, and now it is one million. that is a good thing. society has moved on and is better because of it. mankind has gone from seven days a week to six to five, and i suspect we are already down to about four as we speak. we will adjust. if you and i running the government, all of a sudden we have 10,000 jobs in technology you and i would do something. retraining, but it is not about retraining. it is about how to get a good job. if a trucker was his job, he does not want to -- it's a
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trucker loses his job, he does not want to go back to makg seven dollars an hour. we need to do something to ease that issue and make jobs available, i think it is doable. why, it is the kind of plan and i'm glad you brought up trade, that people who feel global trade has hollowed out their community, their manufacturing, their industry in their part of the world where they grew up, it is difficult to explain to people that globalization of industry lists the boat higher -- lifts the boat higher. it may not have lifted your job there might be technology that can get the job done just as well. that is a message we saw fly back in the election cycle everywhere across the world. people are saying, resisting globalization, that is a trend that if it deepens, will be bad
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for business. jamie: there are issues where globalization is unfair. you could say in steel or something like that. there are issues where disruption, we did not do it properly. hugely beneficial for mankind and the united states. if it helps 98 people, a.b. there are two people that are hurt. -- maybe there are two people that are hurt. 75%yone has to make automation. automation has generally been a good thing. these were very tough jobs. again, i would be in favor of having proper trade, they are trade. -- fair trade, that helps american net. but where it causes something negative in the trade bill, adjustment,tance,
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where people can say this hurt the community or business and get late -- relocation, income assistance, all of those things. republicans are always worried that it is improperly done but the concept is good you read we have to find a way to broaden it out. p, diamonds take on the minimum wage. -- dimon's take on the minimum wage. ♪
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megan: let's talk about regulation, which you mentioned is one of the policy issues. when i talk about people on the street and regulation of the financial sector in particular, and whether we see a rollback of dodd-frank or something else, there is a concern it will go back to less regulated and in people's mind, less regulated
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means more risky. there will be no way to control the corners of the financial wor, and that risk will migrate, and there's a risk if this is struck back. i know you think -- how do you see that playing out? jamie: it is a legitimate thing jeopaize,n did not we did not cause the crisis, and we have three times more capital than we did back then. how much do think we lost in nine quarters after the lehman crisis? or 30 million dollars -- $20 million or $30 million. we saved jobs, helped government, states, schools, hospitals. concept, thethe american public saw a disaster, it was not their fault, and generally it was wall street and washington. they absolutely have a right to
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say we want a banking system that does not cost me money and take down my economy. that does not mean that their fault all of the -- therefore all of these regulations are not good. dodd-frank, that is not accurate. things inhe dodd-frank have nothing to do with the crisis. it was just the pet peeves of certain democrats who put things in because they felt like it. frank and i agreed in some of the things that have been in their. anytime you do major legislation and regulation -- and they are isferent, by the way -- it reasonable for people to look back and recalibrate, think it through, talk about what damage it did. we have not solved the housing market and mortgages. because we have not, banks are
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-- do not want to make loans. if you had a prior bankruptcy, 80% of the time it is perfectly legitimate. it was usually due to get, divorce, disease -- debt, divorce, disease, loss of a job. i would look at some of the rules and regulations of reducing credit available in the system that they do not create more safety and soundness. dodd-frank is not the bible. to me, as a matter fact even chuck schumer used to say to me, eventually these legislations will be opened up so we can recalibrate it, reduce the negative parts that have no benefit while still accomplishing the ultimate goal. it is perfectly reasonable to think about what you can do better as opposed to the knee-jerk reaction that everything put in place is good. days whenyou think
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the industry has a scarlet letter on its back are over or fading? jamie: the industry got a bad scarlet letter. needed it, but the rhetoric was all the banks were bailed out. they were not all bailed out, that part was not true. that beginning scarlet letter. i do not think -- that he came a scarlet letter. i do not think it will go away for some time. every single community in every single city, that is my job. i am proud of j.p. morgan chase. when we make mistakes we admit them and try to fix them. megan: as we are approaching the end of the president's eight years in office, and looking at what he has a compost and his relationship with business, you have had an up and down relationship with the administration. what grade level would you give him on what he has done for business? jamie: i am not going to do
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that. [laughter] jamie: i wish they had spent more time having conversation about what worked and what did not work, instead of doing the opposite. democrats are, i'm going to take care of you, give you free education. like, thest always person they are going to take care of you from is us. i just think it is wrong. i think that whole attitude is misguided. i listen to bernie sanders speak sometimes, and he wants medical insurance for everybody, he wants pension benefits everybody , he wants good paying jobs for everybody, he wants education for everybody. will be $15 toe tell her. well. people everyone at j.p. morgan chase gets medical insurance.
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that person making $15 an hour year.33,000 they also get a pension and 401(k) match. we do all of the things. we train our people, take care of our people and our communities. good companiesat are dinning, so sometimes bernie and i are together on that. [laughter] megan: i am sure bernie is going to love that when he sees this. jamie: here is the american press. bernie sanders or bernie sanders supporters, what is socialism? how is it done? there are two answers. it is never done well elsewhere, it has been a disaster. socialism is where the state owns all private enterprise, that is what it is. you think someone would ask.
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do you think people would have voted for that? megan: the next time i see him. talking about minimum wage, that has been one of your big pushes and he believed it is vital to growth. you have moved it up at jpmorgan. we have a nominee for treasury secretary who has been an advocate for not raising the minimum ge. jamie: i do not think so. he said the government should be very careful about raising its minimum wage too high and a decision made on a local level. a lot of businesses can afford canalifornia and new york afford $50 but upstate new york probably cannot. we are not against states regulating it properly. i would not be in favor if the federal government is doing it and imposing hardships. if you can afford it, raise it. i tell the people that j.p. morgan, we are more worried
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about our lower paid people then our higher paid people. my example is, that will help small business. if you are a small business and has a $10 an hour wage to get by and cannot afford medicals, this will really help you. people,attract better and allow you maybe more benefits overtime. there are solutions to this, and us raising is just a key piece. -- and i'm going to do everything i can. megan: a peek at diamonds up for his legacy at j.p. morgan chase. ♪
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megan: when you look at the world as it is shaping up, and this administration, what are the things that concern you?
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that concernthings you and what are the possible black swan events? jamie: if you look at the geopolitical events since world vietnam, iraq, china had a border skirmish with russia. pakistan, india, i am missing whole bunch. vietnam had a huge effect, but only one will the economy. geopolitics is always very noisy and really has an effect. i would say, is it better or worse, probably a little worse. in the middle east, a lot of uncertainty around the nuclear's are the greatest risks that are going to threaten mankind. and theyea has a bomb are soon going to be able to deliver it all the way to california. it is not my assessment, it is
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the assessment of top people in the government. they might have two years or so. that is a serious issue for the world. i worry obviously about that, and peace in the middle east. what i'm worry about most in reality is bad policy, as doing things that make it worse like government shutdowns and not fixing the school system. if you wanted to get worse, do not fix the school system. that would be worse for the world than honest anything else. the world needs a strong america. might,ld needs military and if you serve in the military, god bless you and thank god, is directly related to the economic might. that is a solution to a lot of these geopolitical issues. megan: as the world need an america that is closer to russia? jamie: geopolitics is different
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from friendship. when you say that, are we going to go hug russia? there are serious issues with russia and they should be dealt with seriously. i think they are kind of resolvable, but i do not know that. i am not an expert. obviously we do business there. i would put that on the list of things that need to be done, so my own view, we should have a strong relationship with nato. it has been dramatically weakened over these years. american troops to be side-by-side in the middle east, -- defend, take europe, not just american boys out there. as jack mcdonald was talking about, if you listen to him. the transatlantic group should all that means is he cannot go anywhere in the e.u., and my own negotiatedan have a
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settlement of new crane. it is probably -- of ukraine. it is probably doable at some point. he wants to become important in the world, become an acceptable leader, so we will see what happens with russia. megan: there has been a lot of reshuffling in the banking industry in the recent weeks, and leadership. you are not going to be the treasury secretary. you would be advising the administration. when you look at your legacy moving forward with detroit a part of it, what is it that you want to be remembered for? what is it you want to have achieved? ceoe: when i was the young the company came to me and said, you have to make a mark, do one boat thing -- big thing. i think if a ceo talks about one hing, build the stock. we have got to do it all right, just like the mayor is doing.
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technology right, culture right, people write, i have got to do it right in every country so i have got to get the whole mosaic. one thing people are going to say, i'm going to miss that son itch.b i am not looking for any other legacy. i am so proud of my company, by the way. we have unbelievable capability. i want to make sure it is one of the best banks in 20 years and i'm glad to be part of the place. megan: is there going to be a second act when you leave? any hint? said, one of my partner you need to do one last big thing. like what? turnaround g.m. for the government. i live and breathe j.p. morgan.
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it is for this company. i want to make this place that are and i will give it everything -- better and i will give it everything while i am here. if i cannot, i should not be the ceo. if you are going to be the quarterback or head coach, you have got to give it your all. when i leave i will probably teach a little bit, i will write. i may write a book. i have a lot to share. business -- in have never been on boards. i would go on public company boards, go on a not-for-profit. i'm going to do a lot of stuff. megan: last question -- if donald trump did call you in a years time or two years if we saw the economy teetering of it and felt like things were slipping back into recession, would you take that call? jamie: i would never not take a
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call from the president of the united states and listen and consider what he has to say i ar it. if you convinced me i was the only one who could do that, i would consider it a patriotic duty, but i doubt that will be the case. ♪
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bailout, billions on a
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the european central bank sees monte dei paschi needing 8.8 billion euros to bolster its balance sheet and shares remain suspended. obama said he could have beaten trump in the election and hillary clinton played it too safe. trump says no way. the shubert may have to write down several billion dollars related to u.s. nuclear -- toshiba may have to write down several billion dollars related to u.s. nuclear units. i am francine lacqua in london, michael mckee in new york. the and 27th of november means the stocks in london are closed and hong kong is closed. we can take stock of what we want for 2017. i love president obama saying he ten donald bea trump and trump saying no way. michael: trump did


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