CNBC Transcript: JPMorgan Chase Chairman & CEO Jamie Dimon Speaks with CNBC's Wilfred Frost Today

By: Jul. 31, 2018
Get Access To Every Broadway Story

Unlock access to every one of the hundreds of articles published daily on BroadwayWorld by logging in with one click.




Existing user? Just click login.

CNBC Transcript: JPMorgan Chase Chairman & CEO Jamie Dimon Speaks with CNBC's Wilfred Frost Today

The following is the unofficial transcript of a CNBC EXCLUSIVE interview with JPMorgan Chase Chairman and CEO Jamie Dimon and CNBC's Wilfred Frost on CNBC's "Closing Bell" (M-F 3PM - 5PM) today Monday, July 30th. Watch video from the interview on CNBC.com here!

DAVID FABER: FOR NOW, LET'S GET TO OUR BIG INTERVIEW FOR THE DAY. WILFRED FROST IS IN SAN DIEGO. HE IS SITTING DOWN EXCLUSIVELY WITH JP MORGAN'S CHAIRMAN AND CEO JAMIE DIMON. WILF, TAKE IT AWAY.

WILFRED FROST: HEY DAVID, HEY SARA. GOOD AFTERNOON TO YOU BOTH. JAMIE, THANKS FOR HAVING US AGAIN. LET'S KICK OFF WITH WHY WE ARE SPECIFICALLY IN SAN DIEGO. YOU'RE JUST KICKING OFF YOUR ANNUAL BUS TOUR. YOU GO AND VISIT BRANCHES AND MEET LOTS OF YOUR EMPLOYEES. WHAT'S THE BIGGEST THING YOU HAVE LEARNED FROM THAT PROCESS OVER THE YEARS?

JAMIE DIMON: YEAH. YEAH. SO WE DO A BUNCH OF - THERE'S A LOT OF TRIPS. WE MEET PEOPLE, CLIENTS, CUSTOMERS, EMPLOYEES, CALL CENTERS. THIS ONE WE DO BY BUS, KIND OF OFF THE BEATEN PATH. NOT SAN FRANSISCO AND L.A., BUT MALIBU, SAN DIEGO, ET CETERA -- AND BECAUSE, YOU KNOW, THESE ARE BOTH CLIENTS AND EMPLOYEES, WE DO A TOWN HALL LATER. WE LEARN A TREMENDOUS AMOUNT. WHAT WE CAN DO BETTER AS A COMPANY, YOU KNOW, WHAT FOLKS WOULD LIKE TO HEAR FROM US MORE ABOUT. AND WE HAVE A LOT OF FUN, WE GET TO KNOW THE MANAGEMENT TEAMS BETTER. ON THE BUS IN BETWEEN WE TAKE - YOU KNOW, BETWEEN SOME OF THESE BRANCHES, WE TAKE TELLERS AND BRANCH MANAGERS AND ASK THEM TO GIVE - GIVE THEM IMMUNITY AND SAY, "TELL US WHAT WE NEED TO KNOW, SO WE CAN RUN A BETTER COMPANY FOR OUR CLIENTS."

FROST: AND YOU'VE GOT A WARM WELCOME HERE, WHICH I'M NOT SURE HOW MANY CHAIRMAN SO FAR UP THE CHAIN WOULD GET. IS THAT SOMETHING THAT -- THAT YOU TAKE A LOT OF POSITIVITY FROM?

DIMON: YEAH. I MEAN, LOOK, I LOVE OUR PEOPLE. AND, I MEAN, THIS IS OUR - THIS IS THE TENTH ANIVERSARY OF WASHINGTON MUTUAL, WHICH IS WHY WE'RE DOING THIS PARTICULAR STATE, AND THEN WE'RE HEADING UP TO SEATTLE. AND, YOU KNOW, LOOK, BASICALLY A COMPANY IS ITS PEOPLE. THEY DELIVER TO YOUR EMPLOYEES. THEY WANT TO DO A GOOD JOB. THEY WANT HAPPY CUSTOMERS. WHEN WE TALK ABOUT CLIENT OBSESSION, WE MEAN IT. BUT THAT HAS TO START WITH ME, TOO. I HAVE TO TALK TO THE CLIENTS. I HAVE TO THEM - MY LUNCHES AND DINNERS AND TOWN HALLS. AND WE HAVE TO LISTEN TO OUR PEOPLE, BECAUSE OUR PEOPLE ARE THE ONES DEALING WITH OUR CUSTOMERS EVERY SINGLE DAY.

FROST: YOU MENTIONED THE WA-MU ACQUISITION. TEN YEARS AFTER THAT. YOU WOULDN'T HAVE THE FOOTPRINT YOU HAVE HERE IN CALIFORNIA IF NOT FOR IT. BUT YOU'VE ALSO HAVE BEEN A BIT CRITICAL OF THOSE ACQUISITIONS YOU DID DURING THE CRISIS. TEN YEARS AGO, IF YOU HAD THE TIME AGAIN, WOULD YOU DO THIS ACQUISITION AGAIN?

DIMON: ABSOLUTELY. YOU KNOW, WA-MU PUT US INTO CALIFORNIA, WHERE WE REALLY WEREN'T, IN FLORIDA, WE HAD A VERY SMALL PRESENCE, WASHINGTON STATE. AND WE'VE GONE FROM LIKE 1400 BRANCHES TO 1800. WE'VE GONE FROM -- THEY DIDN'T HAVE SMALL BUSINESS FUNDING HERE AT ALL, OR VERY SMALL. WE NOW HAVE $7 BILLION OF LOANS UP FROM SOMETHING LESS THAN A BILLION. SO IT'S BEEN A GREAT THINGS FOR THOSE STATES. AND EVERY COMMUNITY WHERE WA-MU WAS WE NOW HAVE COMMERCIAL BANKING, INVESTMENT BANKING, PRIVATE BANKING, CORPORATE SOCIAL RESPONSIBILITY AND PHILANTHROPY, SO IT'S BEEN GREAT. THE NEGATIVE I'VE ALWAYS TALKED ABOUT IS WE WERE PUNISHED A LITTLE BIT AFTER THE FACT BY THE GOVERNMENT FOR SOME OF THE THINGS WA-MU DID. BUT YOU KNOW WHAT, THAT'S IN THE PAST. WE'RE MOVING FORWARD.

FROST: YOU'RE ONE OF THE FEW BIG BANKS STILL ACTUALLY EXPANDING YOUR BRANCH FOOTPRINT. THAT'S MORE IN NEW GEOGRAPHIES THAN JUST ARBITRARILY HAVING MORE BRANCHES. WHAT'S ALLOWING YOU TO DO THAT? IS IT THE REGULATORY ENVIRONMENT THAT NOW ALLOWS YOU TO PUSH INTO THAT? OR IS IT BECAUSE YOU SEE WEAKNESS IN SOME OF YOUR RIVALS IN THOSE GEOGRAPHIES?

DIMON: IT'S THE REGULATORY ENVIRONMENT. THEY HAD MADE IT CLEAR THEY DIDN'T WANT US TO EXPAND. I DON'T KNOW WHY, I MEAN, IT'S A WONDERFUL THING TO DO. SO OPENING - WE'VE ANNOUNCED 400 BRANCHES PRETTY MUCH BETWEEN WASHINGTON, PHILLY, BOSTON, A FEW OTHERS. AND WE GO TO THOSE TOWNS. WE DO SMALL BUSINESS LENDING. LMI LENDING -- LOWER, MIDDLE INCOME HOUSING LENDING. WE DO, YOU KNOW, WE DO A LOT OF CORPORATE RESPONSIBILITY. SO IT'S REALLY GOOD FOR THE TOWNS. AND REMEMBER WE ALREADY DO BUSINESS IN A LOT OF THOSE TOWNS IN CREDIT CARD, PRIVATE BANKING, MIDDLE MARKET, LARGE CORPORATE INVESTMENT BANKING. SO IT DOESN'T AT ANY INCREMENTAL RISK AT ALL FOR OPEN BRANCHES. SO WE EVENTUALLY WANT TO GO ACROSS THE COUNTRY AND FILL IN SOME OF THE CITIES WE'RE NOT IN.

FROST: LET'S TALK ABOUT THE BROADER U.S. ECONOMY. WE HAD A 4% HANDLE ON THE GDP ON FRIDAY. DO YOU CONGRATULATE THE PRESIDENT ON THAT NUMBER? WAS HE RIGHT TO TAKE A SORT OF VICTORY LAP AFTER IT WAS ANNOUNCED?

DIMON: PRESIDENT'S GET A LOT OF CREDIT, A LOT OF BLAME FOR THINGS THEY DIDN'T DO. BUT THE PRESIDENT HAS DONE THINGS WHICH ACCELERATED GROWTH. SO COMPETITIVE TAXES, WE NEEDED COMPETITIVE TAXES. AND THE WAY THE AMERICAN PUBLIC SHOULD THINK ABOUT IT, FOR 20 YEARS WE'VE BEEN INCREASINGLY UNCOMPETITIVE DRIVING CAPITAL AND BRAINS OVERSEAS. REGULATORY REFORM, AND I'M NOT TALKING ABOUT A BIG BANK, I'M TALKING ABOUT SMALL BUSINESSES. IF YOU SAT DOWN AND JUST DO IT ONE DAY WITH SMALL BUSINESSES, THEY'LL TELL YOU ABOUT THE CRIPPLING BUREAUCRATIC PAPERWORK, LITIGATION, THAT -- WE'VE HAD LESS SMALL BUSINESS IN AMERICA THAN ANY OTHER RECOVERY. YEAH, SO THIS HAS ACCELERATED THE GROWTH. WE'VE HAD 20% OVER TEN YEARS. IT SHOULD HAVE BEEN 40%. THE REASON IT WASN'T 40 WAS BECAUSE A LOT OF THINGS THAT WE DID TO HURT OURSELVES. SO I'M HOPING WE CONTINUE OUR POLICIES AND ACCELERATE GROWTH. AND GROWTH IS GOOD FOR ALL AMERICANS, WHICH IS WHY IT'S SO IMPORTANT TO HAVE SOME KIND OF GROWTH AGENDA.

FROST: IS 4% SUSTAINABLE?

DIMON: I THINK WE COULD DO A LOT BETTER THAN 2%. AND I FIRMLY BELIEVE THE REASON IT WAS 2% IS NOT SOME NATURAL REASON. IT WAS BAD INFRASTRUCTURE, BAD TAXATION, EXCESS REGULATION, WE DON'T GRADUATE KIDS OUT OF INNER-CITY SCHOOLS - 50% DON'T GRADUATE, WE DON'T GIVE KIDS THE SKILLS THEY NEED, WE DON'T LET FELLONS GET JOBS AGAIN, WE HAVE AN OPIOID CRISIS. LIKE TAKE BUREAUCRACY, IT TAKES 12 YEARS TO GET PERMITS TO BUILD A BRIDGE THAT'S ALREADY THERE AND FAILING. AND IT TOOK EIGHT YEARS TO PUT A MAN ON THE MOON. SO THE AMERICAN PUBLIC LOOKS AT THIS STUFF AND SAYS THAT'S WHAT'S HOLDING US BACK, IT WAS US. SO IT CERTAINLY NEEDS TO BE A HELL OF A LOT BETTER THAN 2%. AND I DON'T KNOW IF THE NATURAL RATE IS 3.5% OR 4% OR 3% BUT IT'S NOT 2%.

FROST: LET'S TALK ABOUT THE PRESIDENT'S TRADE POLICIES. WE TALK ABOUT THE U.S. ECONOMY BEING STRONG, BUT CHINA'S GDP THAT JUST CAME OUT WITH 6.7%. IF THAT TRADE BATTLE WITH CHINA CONTINUES TO ESCALATE, WHO WINS IT ULTIMATELY? WHO CAN TAKE --

DIMON: SO RIGHT NOW I'D PUT IT IN THE SKIRMISH CATEGORY, AND YOU KNOW, WE -- THE BUSINESS COMMUNITY IS PRETTY MUCH REPRESENTATIVE TO THE PRESIDENT THAT WE AGREE WITH A LOT OF THE ISSUES RAISED BY CHINA. THE BUSINESS COMMUNITY IN GENRAL WOULD HAVE APPROACHED IT DIFFERENTLY WHICH IS TO GET CANADA, MEXICO, JAPAN AND EUROPE TO HAVE A COMMON FRONT TO PRESENT TO CHINA THE WAY TRADE NEEDS TO BE DONE. IT NEEDS TO BE FIXED. WE WANT IT TO BE FIXED. HE'S TAKEN AN APPROACH WHICH, YOU KNOW, I'M A LITTLE WORRIED COULD CREATE THESE NEGATIVE OUTCOMES. WE'VE TOLD THE PRESIDENT THAT. I'M HOPING HIS METHODS WORK. IF IT BECOMES MORE THAN A SKIRMISH - IF YOU DO $200 BILLION MORE, AND YOU DO THE AUTO TARIFFS, STUFF LIKE THAT, YEAH, I THINK IT COULD OFFSET SOME OF THE BENEFIT WE'VE HAD FROM THE GOOD THINGS HE'S DONE.

FROST: YOU SAID YOU TOLD THE PRESIDENT YOU DISAGREE WITH HIS TACTICS? WHAT WAS HIS RESPONSE?

DIMON: HE OBVIOUSLY DOESN'T AGREE WITH SO. AND SO - BUT I WOULD ALSO TELL THE PRESIDENT THAT HIS - TWO OF HIS ADVISERS TOLD HIM, AND I'M NOT GOING TO NAME THEM, BUT THEY TOLD HIM THERE WOULD BE NO RETALIATION. WE SAID THERE ABSOLUTELY WOULD BE. AND THEY WERE WRONG. SEVERAL PEOPLE SAID THERE WOULD BE NO EFFECT ON CONSUMER SPENDING OR INFLATION AND THEY'RE WRONG. SO THE FACT IS SOME OF THINGS WERE WRONG. I WANT HIM TO DO WHAT HE -- I WANT HIM TO SUCCEED AT HAVING BETTER TRADE. I THINK NAFTA SHOULD BE DONE. I MEAN, THEY'VE BEEN TALKING ABOUT THIS FOR A LONG TIME NOW. IT SHOULD BE DONE BY NOW. MEXICO IS A WONDERFUL NEIGHBOR OF OURS AND WE SHOULD MOVE ON, DO A DEAL, DO A DEAL WITH CANADA AND THEN FOCUS ON CHINA.

FROST: NOW CLEARLY AS YOU ALREADY SAID YOU DISAGREE WITH HIS TACTICS BUT IF WE CONSIDER THE NEWS THAT CAME OUT OF HIS MEETING WITH JOHN CLAUDE JUNCKER LAST WEEK THAT THERE IS PROGRESS BETWEEN THE U.S. AND THE EU, DOES THAT SUGGEST THAT IN THE LONG-TERM HE COULD BE PROVEN RIGHT, THAT THIS COULD ALL WORK OUT FOR THE BEST?

DIMON: HE MAY. I DON'T KNOW BETTER THAN YOU.

FROST: BUT YOU CRITICIZE HIS ADVISERS FOR GIVING HIM WRONG ADVICE ON TACTICS?

DIMON: WELL NO, I THINK THAT - I THINK THERE'S BEEN RETALIATION, AND I THINK IF WE DO IT THERE'LL BE ANOTHER PREDICTABLE ROUND OF RETALIATION. AND THERE WILL BE A MOUNTING UNCERTAINTY AND A REDUCING INVESTMENT AND IT WILL EVENTUALLY SLOW DOWN THE GDP. AND OF COURSE NO ONE WANTS THAT. AND WE THINK THERE ARE JUST BETTER WAYS TO DO IT, BUT OBVIOUSLY WE WANT HIM TO FINISH A TRADE DEAL WITH CHINA THAT DEALS WITH THE IMPORTANT SUBJECTS. YOU KNOW, RECIPROCAL OWNERSHIP, HOW INTELLECTUAL PROPERTY GETS HANDLED, NON-TARIFF BARRIERS AND STUFF LIKE THAT. SO THOSE ISSUES ARE ALL REAL. THEY NEED TO BE RESOLVED.

FROST: IN TERMS OF HIS TEAM, JAMIE, WERE YOU EVER OFFERED A JOB ON HIS TEAM AND GIVEN THAT YOU QUESTION THE ADVICE HE'S GETTING, DO YOU WISH YOU'D TAKEN IT IF YOU WERE OFFERED IT?

DIMON: I'M NOT GOING TO TALK ABOUT CONVERSATIONS -- I'M VERY HAPPY WHERE I AM. I LOVE MY COMPANY, I LOVE MY JOB.

FROST: I KNOW YOU DO. AND WE WILL CERTAINLY BE COMING TO THAT A BIT MORE LATER. JUST ON THE TOPIC OF THE PRESIDENT VERY QUICKLY, THE PRESIDENT SAID IN A PRESS CONFERENCE WITH THE ITALIAN PRIME MINISTER IT WOULD BE OKAY TO HAVE A GOVERNMENT SHUTDOWN. THAT RELATED TO THE FACT HE WANTS TO GET FUNDING FOR HIS BORDER WALL. WHAT WAS YOUR RESPONSE TO THAT?

DIMON: I THINK IT'S BEEN TRIED BEFORE AND HADN'T HAD GOOD OUTCOMES. AND IT HURTS A LOT OF PEOPLE WHO REALLY HAVE NOTHING TO DO WITH THE PROCESS. I THINK THE POLITICAL PROCESS SHOULD LEARN NOT USE THOSE THINGS TO GET WHAT THEY WANT. I UNDERSTAND THE PRESIDENT'S POINT, BUT THIS IS -- THAT IS NOT A WAY TO BE PRODUCTIVE AND CONDUCIVE TO GROWTH.

FROST: LET'S TALK ABOUT THE FED AND INTEREST RATES, JAMIE, IF WE MAY. THE PRESIDENT MADE CLEAR IN AN INTERVIEW WITH CNBC A COUPLE OF WEEKS AGO HE PREFERED LOWER RATES. TALKING ABOUT THE FED HIKES, HE SAID, QUOTE, "I'M NOT THRILLED BECAUSE WE GO UP, AND EVERY TIME YOU GO UP, THEY WANT TO RAISE RATES AGAIN. I'M NOT HAPPY ABOUT IT, BUT AT THE SAME TIME I'M LETTING THEM DO WHAT THEY FEEL BEST." DID HE GO TOO FAR WITH THAT STATEMENT, COMMENTING ON THE POLICY?

DIMON: LOOK THE FED IS GIVEN THEIR MANDATE BY CONGRESS AND THAT MANDATE IS QUITE CLEAR. YOU CAN ARGUE WHETHER IT'S THE RIGHT MANDATE OR NOT. I THINK THE OTHER THING THAT EVERYONE SHOULD THINK IN MIND WHICH IS, WITH INTEREST RATES, IS WHY ARE THEY GOING UP? SO IF THEY'RE GOING UP AND THEY'RE GOING UP GENTLY -- IF THEY'RE GOING UP BECAUSE THE ECONOMY IS STRONG, THAT NETNET'S A VERY GOOD THING. SO IT'S VERY HARD TO LOOK AT INTEREST RATES AND SEPARATE THAT AS ONE FACTOR AND SAY IT DOESN'T RELATE TO HOW THE ECONOMY IS DOING. SO I THINK AS LONG AS RATES ARE GOING UP AND THE ECONOMY IS GOING STRONG, WE'RE GOING TO BE FINE.

FROST: WHEN WE LOOK AT THE SHAPE OF THE YIELD CURVE A LOT OF PEOPLE GET CONCERNED ABOUT THE FACT THAT IT'S FLATTENING. DOES THAT TO YOU SUGGEST THAT THE FED IS GOING A LITTLE BIT TOO FAST? THAT THEY SHOULD TAKE THE FOOT OFF THE HIGH PACE FOR NOW?

DIMON: NO, I THINK THAT'S, AGAIN, A VERY SIMPLISTIC WAY TO LOOK AT IT. THAT'S 1 FACTOR. THERE ARE A LOT OF OTHER FACTORS INVOLVED. AND WHILE IN HISTORY THAT HAPPENED BEFORE - BUT WE HAVE GROWTH. I PERSONALLY THINK THE TEN YEAR BOND IS GOING TO BE GOING UP NOT DOWN. BUT AGAIN, LIKE I SAID, FOR GOOD REASONS - YOU KNOW NATURAL RATE FOR THE TEN YEAR BOND TODAY WITH AN INFLATION OF 2% WOULD BE 4%. AND SO YOU KNOW WE'VE HAD A SUPPRESSION OF RATES FOR THE BETTER PART OF A DECADE AROUND THE WORLD. THOSE THINGS ARE REVERSING. BUT SO FAR IT'S A GOOD EFFECT. WHICH IS GLOBAL GROWTH IS GOING TO BE STRONGER THAN IT'S BEEN IN A LONG PERIOD TIME. IN AMERICA IT LOOKS LIKE IT'S ACCELERATING. SO AS LONG AS THEY'RE RAISING RATES IN THAT IT'S FINE.

FROST: THE MORE I THINK ABOUT YOUR SHARE PRICE, JAMIE, AND FOR ALL OF THE BIG BANKS, IT'S BEEN SO TIGHTLY CORRELATED WITH WHAT THE YIELD CURVE IS DOING. HOW DO YOU THINK ABOUT THAT? IS THAT CORRELATION OVER DONE, WHETHER WE GET A SLIGHTLY FLAT OR SLIGHTLY STEEPER CURVE? DO YOU THINK PEOPLE -- THE SHARE PRICE REACTION TO IT IS OVERDONE?

DIMON: SO WE MAKE A VERY CLEAR DISCLOSURE. WHAT DO INTEREST RATES ALONE DO TO OUR PNL. NOW OF COURSE THAT'S NOT WHAT THE WORLD IS, RIGHT? INTEREST RATES GO UP AND DOWN FOR A REASON. BUT ALONE, RATES GOING UP, SHARE RATES GOING UP HELPS OUR PNL, HELPS OUR PROFIT LINE. SO - BUT I THINK THERE'S AN OVERREACTION TO THAT. I THINK BANKS ARE ALL DIFFERENT. WE'RE GOING TO DO QUITE WELL AS A BANK REGARDLESS. WE DON'T TAKE BETS AND INTEREST RATES. BUT IF YOU THINK THAT RATES ARE GOING DOWN, THE TEN YEAR BECAUSE THE ECONOMY IS WEAKENING, THEN OBVIOUSLY THAT'S GOING TO EFFECT ALL BANKS. I JUST THINK THAT'S NOT WHAT'S HAPPENING OUT THERE.

FROST: NOW IN TERMS OF THE EQUITY MARKET, JAMIE, THERE'S BEEN SOME TECH EARNINGS MISSES THE LAST COUPLE OF WEEKS. FACEBOOK WAS A HIGH PROFILE ONE. THE NASDAQ IS DOWN SHARPLY AGAIN TODAY. WHEN YOU SEE THOSE EARNINGS NUMBERS AND YOU SEE THE MARKET REACTION, DOES THAT TO YOU SUGGEST THE EQUITY MARKET PERHAPS PARTICULARLY THE TECH SECTOR IS LITLLE BIT OVERHEATED RIGHT NOW?

DIMON: NOT REALLY. I THINK SOME OF THINGS ARE COMPANY SPECIFIC. AND OBVIOUSLY COMPANIES THAT HAVE VERY HIGH PE'S, WHEN YOU FORECAST AND THE FUTURE CHANGES A LITTLE BIT IT'S GOING TO DRAMATICALLY CHANGE THE STOCK PRICE. BUT IF YOU LOOK AT STOCKS, IF YOU THINK WE MIGHT HAVE A GOOD ECONOMY FOR A COUPLE YEARS, AND THAT EARNINGS ARE GOING TO GROW 5%, 10% OR MORE, EVEN IF PE'S COME DOWN BECAUSE RATES ARE GOING UP, THAT'S A VERY LIKELY OUTCOME. SO I'M NOT SAYING THAT'S GOING TO HAPPEN. I LOOK AT THE POSSIBILITIES AND PROBABILITIES, BUT THE ECONOMY LOOKS QUITE STRONG. CONSUMERS ARE IN GOOD SHAPE. BALANCES ARE IN GOOD SHAPE. THERE ARE NO POTHOLES OUT THERE, LENDING HAS BEEN PRISTINE. CAPITAL EXPENDITURES HAVE BEEN GOING UP. MORE PEOPLE ARE GOING BACK TO WORK, UNEMPLOYMENT MAY HIT A POST WAR LOW AT ONE POINT THIS YEAR. THOSE ARE ALL POSITIVES. AND WE DON'T HAVE THE LEVERAGE IN THE SYSTEM WE HAD IN '07. THERE'S ALWAYS GOING TO BE SOME KIND OF PROBLEM, BUT THAT IS NOT THE PROBLEM TODAY.

SARA EISEN: LET'S GET BACK OUT TO WILFRED FROST IN CALIFORNIA WITH JAMIE DIMON TO CONTINUE THE CONVERSATION. WILFRED, TAKE IT AWAY.

FROST: THANK YOU VERY MUCH, GUYS. JAMIE, WE WERE JUST TALKING THERE ABOUT THE EQUITY MARKET AND WHETHER THINGS PERHAPS GET OVERVALUED. DO YOU THINK THERE'S A POINT AT WHICH WE'RE GETTING CLOSER WHERE WE'RE DUE ANOTHER SIGNIFICANT PULL BACK? WE SAW ONE IN FEBRUARY, OF COURSE.

DIMON: I DON'T PREDICT THE STOCK MARKET, AS YOU KNOW. YOU'VE GOT TO LOOK AT THE UNDERLYING STUFF. SO IS THERE A CHANCE THE ECONOMY IS STRENGTHENING AND GOING FOR A COUPLE YEARS? ABSOLUTELY. IF THAT'S TRUE, THEN STOCK PRICES ARE JUSTIFIED. IF YOU THINK WE'LL HAVE A RECESSION TOMORROW, NO, THEY'RE NOT JUSTIFIED. BUT I DON'T KNOW. IT LOOKS TO ME LIKE THE RECESSION HAS BEEN PUSHED-THERE WILL BE ONE. SOMEONE JUST ASKED ME IN THE TOWN HALL IS THERE A RECESSION? WELL OF COURSE. I JUST DON'T KNOW IF IT'S 2020, 2021, 2022. BUT IT LOOKS LIKE IT'S NOT 2019. SO THE ECONOMY SEEMS TO BE STRENGTHENING. THAT'S A GOOD THING.

FROST: RECENTLY WE HAD THE CEO OF BB&T ON, KELLY KING, TO TALK A LITTLE BIT ABOUT THE BANKING INDUSTRY DYNAMICS. AND HE SAID THERE NOW THAT REGULATION HAS BEEN EASED FOR BANKS UNDER $250 BILLION IN ASSETS THAT HE IS CONSIDERING SOME CONSOLIDATION AND SOME ACQUISITIONS. DO YOU WELCOME A LITTLE BIT OF CONSOLIDATION AMONGST THE SMALLER BANKS BELOW YOU OR IS IT UNFAIR THAT THE REGULATION HASN'T BEEN EASED FOR YOU, AS WELL?

DIMON: WE'VE ALWAYS SAID THAT THEY SHOULD DO WHAT THEY DID, WHICH IS DEREGULATE FOR THE SMALLER BANKS. AND THEY NEED TO CONSOLIDATE TO COMPETE SO I'M TOTALLY SYMPATHETIC WITH THAT. WE'VE NEVER HELD THAT HOSTAGE TO WHETHER WE THINK SOME OF THE RULES ARE NOT SO FAIR OR UNFAIR. THE REGULATORS ARE LOOKING AT ALL THE VARIOUS RULES. THOUSANDS ARE PUT IN PLACE. PEOPLE POINT OUT ONE. THERE ARE THOUSANDS AND THEY WEREN'T NECESSARILY COORDINATED, WELL THOUGHT THROUGH. THEY MAY HAVE ADVERSE CONSEQUENCES IN THE NEXT DOWN TURN. THEY SHOULD LOOK AT IT AND RECALIBRATE IT. NO ONE IS ASKING FOR DODD/FRANK TO BE THROWN OUT AND WE ARE PROBABLY THE BIGGEST BANK TO SMALL BANKS IN THE COUNTRY SO WE WANT THEM TO DO WELL. IT'S NOT US VERSES THEM AND IT NEVER WAS.

FROST: IN TERMS OF POTENTIAL ACQUISITIONS, YOU WERE LINKED WITH MAYBE MAKING A BID FOR DEUTSCHE BANK, RULED THAT OUT. BUT IS THERE A SORT OF RATIONALE BEHIND WHY ONE OF THE U.S. INVESTMENT BANKS WOULD LOOK TO BUY SOME OR PART OF DEUTSCHE BANK, PARTICULARLY ITS U.S. OPERATION INVESTMENT BANK?

DIMON: I CAN'T ANSWER THAT QUESTION. THERE WILL BE OVER THE NEXT TEN YEARS, IN MY OPINION, NEW COMPETITORS IN THE INVESTMENT BANKING WORLD, INCLUDING, BY THE WAY, FROM CHINA. SOME PEOPLE MAY MERGE TO GET MORE KINDS OF SCALE. I THINK IN EUROPE THEY'RE GOING TO HAVE CONSOLIDATIONS, TOO. BUT BEFORE THEY HAVE THAT, THEY ACTUALLY HAVE TO CHANGE SOME OF THE REGULATIONS THERE AROUND BANKS SO THEY CAN HAVE A PAN-EUROPEAN INSURANCE SYSTEM, A PAN-EUROPEAN REGULATORY SYSTEM. BUT IT MAKES A TREMENDOUS SENSE OF LOGIC, THAT THOSE TAKE PLACE OVER TIME, AS THEY HAVE IN THE PAST. BUT AS YOU KNOW, MERGING INVESTMENT BANKS IS A VERY COMPLICATED BUSINESS.

FROST: SO WE TALKED ABOUT BANK, WE TALKED ABOUT TECH. IF WE JUST GO BACK TO THE BROADER ECONOMY VERY QUICKLY, WHAT IS THE SINGLE BIGGEST RISK TO THE ECONOMY? IS IT POLITICS OR IS IT THE FED OR WHAT?

DIMON: IT'S TRADE IF THE SKIRMISH BECOMES MORE OF A WAR. I WOULD SAY THE REVERSE OF A QE AND I DON'T WANT TO SCARE THE PUBLIC, BUT WE'VE NEVER HAD QE, WE'VE NEVER HAD THE REVERSAL. REGULATIONS ARE DIFFERENT, MONETARY TRANSMISSION IS DIFFERENT. GOVERNMENTS HAVE BORROWED TOO MUCH DEBT, AND PEOPLE CAN PANIC WHEN THINGS CHANGE. SO IT'S CHANGING, WE TELL YOU ITS CHANGING, WE KNOW IT'S GONNA CHANGE OR IT HAPPENS. IT MIGHT HAVE SOME EFFECTS THAT PEOPLE DON'T EXPECT, AND I THINK IT IS BAD POLICIES. BAD POLICIES LEAD TO BAD OUTCOMES. I ALWAYS HOPE THAT PEOPLE DO A BETTER ANALYSIS, LIKE WHAT ARE WE TRYING TO ACCOMPLISH, HOW ARE WE GOING TO GET THERE AND LET'S MAKE SURE WE UNDERSTAND THE EFFECTS OF THESE POLICIES. THE AMOUNT OF UNINTENDED CONSEQUENCES FROM BAD POLICY IS STAGGERING. AND IF I WRITE A BOOK, I MIGHT WRITE ABOUT THAT ONE DAY - HOW WE DIDN'T THINK THROUGH SOME OF THESE POLICIES THAT ARE PUT IN PLACE.

FROST: LET'S TALK ABOUT YOUR HEALTHCARE INITIATIVE WITH BERKSHIRE HATHAWAY AND AMAZON. YOU BANK A LOT OF HEALTHCARE COMPANIES YOURSELF. WHAT HAS BEEN THEIR RESPONSE TO YOU FOR YOU KIND OF MOVING INTO THEIR SPACE AS IT WERE?

DIMON: SOME WERE UNHAPPY BECAUSE THEIR STOCKS WENT DOWN THAT DAY WHICH I THINK IS KIND OF AN OVERREACTION. WE HIRED A GREAT CEO. I EXPLAINED TO THOSE-I SPOKE TO MANY OF THEM, BY THE WAY. I SAID, NO, WE ALREADY BUY INSURANCE FOR 400,000 PEOPLE AND FOR JP MORGAN, AND I WANT TO DO A BETTER JOB. AND WE'RE GOING TO PUT MORE BRAIN POWER AND MORE CAPABILITY TO FIGURE OUT HOW WE CAN MAKE YOU HEALTHIER AND HAPPIER WITH BETTER SATISFACTION. WE'RE TOTALLY ALIGNED WITH JEFF BEZOS AND WARREN BUFFETT, AMAZON AND BERKSHIRE. WE THINK TOGETHER IF WE HAVE THE RIGHT PEOPLE, A LONG-TERM VIEW, WE'RE NOT PROFIT SEEKING, THAT WE CAN DO WHAT WE'RE DOING A LOT BETTER. WE DON'T EXPECT PROGRESS IN IMMEDIATE FUTURE, LIKE A YEAR OR TWO. BUT IF WE COME UP WITH SOME GREAT STUFF, WE'RE GOING TO SHARE IT WITH EVERYBODY. I TOLD ALL THESE COMPANIES HELP US DO IT. YOU KNOW THAT SOME OF THESE THINGS NEED TO BE FIXED. DON'T ACT LIKE WE'RE ENEMY. THE ENEMY IS WE'RE NOW SPENDING ALMOST 20% OF OUR GDP ON HEALTHCARE AND IT'S TOO MUCH AND THE OUTCOMES AREN'T GOOD. IN AMERICA THERE'S SOME OF THE BEST AND SOME OF THE WORST AND SO WE GOTTA JUST DO A BETTER JOB.

FROST: HAVE YOU OR DO YOU EXPECT THAT YOU MIGHT LOSE ANY CLIENTS BECAUSE OF THIS PROCESS?

DIMON: I DON'T EXPECT SO, BUT IF THAT HAPPENS, SO BE IT.

FROST: HAS IT BEEN A MORE TRICKY PROCESS THAN YOU EXPECTED? IS IT PERHAPS LESS WORTHWHILE GIVEN THE GRIEF YOU'VE GOT?

DIMON: NO, THIS IS AN ABSOLUTE CRITICAL ISSUE, AND ALL OF US HAVE A VERY LONG-TERM VIEW. AND WE'VE BEEN THROUGH THE AMOUNT OF MONEY SPENT ON FRAUD, ADMINISTRATION, END OF LIFE, THE MISUSE OF DRUGS, CHRONIC CARE PROBLEMS, WELLNESS PROGRAMS DON'T WORK. LIKE OBESITY AND SMOKING DRIVE A TREMENDOUS AMOUNT OF HEART DISEASE, CANCER, DEPRESSION, STROKE, DIABETES AND WE'VE GOT TO GET AT THIS AS A NATION. AND WE THINK TOGETHER WE MIGHT BE ABLE TO MAKE SOME PROGRESS. WE ALL SAID WE'RE GOING TO GIVE IT OUR BEST SHOT AND WE'RE GONNA BE VERY PATIENT. I REMIND PEOPLE OF JEFF BEZOS, WHEN HE STARTED AMAZON, HE MAY HAVE HAD VISIONS ABOUT THE EVERYTHING STORE, BUT HE STARTED WITH BOOKS AND HE SPENT TEN YEARS GETTING BOOKS RIGHT. SO WE MAY SPEND A BUNCH OF TIME GETTING ONE PIECE OF IT RIGHT BEFORE WE-AND TESTING VARIOUS THINGS TO SEE WHAT WORKS.

FROST: HE OFFERED YOU A JOB, DIDN'T HE? DO YOU WISH YOU'D TAKEN IT?

DIMON: HE DIDN'T OFFER ME THE JOB, BUT HE WAS LOOKING FOR A PRESIDENT AND I FLEW TO AMAZON AFTER I HAD LEFT CITI-I WAS FIRED FROM CITI-AND WE HAD A GREAT LUNCH. WE'VE BEEN FRIENDS EVER SINCE. I HAD THIS VISION THAT I'D NEVER WEAR A SUIT AGAIN, I'D LIVE IN A HOUSE BOAT LIKE TOM HANKS-THAT MOVIE SLEEPLESS IN SEATTLE HAD COME OUT-BUT IT WAS JUST A BRIDGE TOO FAR FOR ME TO MOVE MY WHOLE FAMILY TO SEATTLE AT THAT AGE, AT THAT TIME, TO SOMETHING I DIDN'T FULLY UNDERSTAND AS OPPOSED TO I'VE BEEN IN FINANCIAL SERVICES MY WHOLE LIFE.

FROST: WELL YOUR STOCK OPTIONS AT JP HAVE BEEN PROFITABLE BUT IT WOULD'VE BEEN EVEN MORE SO AT AMAZON. BUT ANYWAY, YOU'RE NOT WEARING A SUIT TODAY SO HOPEFULLY IT ALL COMES TOGETHER.

DIMON: I SEE, AND YOU'RE WEARING CHASE BLUE TOO, BY THE WAY, SO THANK YOU. I SEEL A LOT OF YOUR STAFF OUT HERE IS WEARING CHASE BLUE. I HOPE IF YOU'RE ALL FROM NEW YORK, YOU ALL HAVE CHASE ACCOUNTS, TOO. IF YOU EVER HAVE A PROBLEM WITH CHASE YOU CAN CALL ME DIRECTLY.

FROST: THIS IS "CLOSING BELL" BLUE. BUT JUST WANT TO QUICKLY TALK ABOUT THE ME TOO MOVEMENT. CBS STOCK HAS BEEN DOWN SHARPLY THE LAST COUPLE OF DAYS OVER ALLEGATIONS AGAINST THE CHAIRMAN AND CEO LESLIE MOONVES. SO FAR, ALL OF THESE STORIES THAT HAVE COME OUT HAVE BEEN FOCUSED IN ONE INDUSTRY, MAINLY, IN THE MEDIA INDUSTRY. DO YOU THINK THERE ARE SOME TYPES OF STORIES LIKE THAT TO COME FROM WALL STREET OR NOT?

DIMON: I THINK THERE'S BAD BEHAVIOR EVERYWHERE, OKAY, AND I THINK IT'S IMPORTANT ALL COMPANIES TRY TO ROOT IT OUT WHEREVER IT IS AND THEY HAVE THE RIGHT LISTENING POST UP TO HR. AND HR HAS GOT TO LISTEN, THEY CAN'T JUST ACT LIKE THE COMPANY IS ALWAYS RIGHT. LEGAL. AS I'VE ASKED A LOT OF OUR SENIOR WOMEN - AS YOU KNOW HALF OF MY DIRECT REPORTS ARE WOMEN - I SAY, "YOU ALL SET THE TONE. MAKE SURE WE'RE DOING IT RIGHT." BUT YOU KNOW, OF COURSE YOU WORRY IN ANY BIG COMPANY. WHEN YOU COME TO ANY LOCATION, THAT THAT BRANCH MANAGER OVER THERE WHO'S HOLDING YOUR JOB IN THEIR HANDS, YOU MAY BE AFRAID TO USE ONE OF THOSE HOT LINES. SO WE ARE ALWAYS LOOKING FOR WAYS TO MAKE SURE THAT PEOPLE HERE ARE TRUSTED AND RESPECTED AND NOT MISTREATED. AND WE SHOULD ALL STRIVE TO DO A BETTER JOB.

FROST: I WANT TO ASK YOU A LITTLE BIT ABOUT LLOYD BLANKFEIN IF I MAY, JAMIE. OF COURSE, THE TWO OF YOU, THE ONLY TWO REMAINING CEOS OF THE BIG BANKS FROM PRE-CRISIS TIMES. DO YOU THINK GOLDMAN SACHS WOULD HAVE SURVIVED THE CRISIS IF NOT FOR HIM?

DIMON: OH GOD, I DON'T KNOW. LLOYD IS A FRIEND, I THINK HE IS A WONDERFUL GUY, A GREAT LEADER AND HE DID A GREAT JOB TAKING THAT COMPANY THROUGH A REALLY DIFFICULT TIME.

FROST: YOU JOKED IN A COMMENT TO ME BEFORE THAT YOU HOPE YOU SEE MORE OF HIM GOING FORWARD, JUST SOCIALLY OR IS THERE A JOB FOR HIM?

DIMON: LLOYD AND I SEE EACH OTHER SOCIALLY AND OUR SPOUSES. WE HAVE A GREAT TIME TOGETHER. SO I'M SURE WE'LL CONTINUE TO DO THAT.

FROST: IN HIS STATEMENT WHEN HE ANNOUNCED HIS RETIREMENT, HE SAID THIS ABOUT THE TIMING OF HIS DEPARTURE: "WHEN THINGS ARE GOING BADLY YOU CAN'T LEAVE, WHEN THINGS ARE GOING WELL, YOU DON'T WANT TO LEAVE. SO IF YOU'RE GOING TO GO OUT ON YOUR OWN STEAM, IT IS ALWAYS GOING TO BE THE MOMENT WHEN YOU DON'T WANT TO LEAVE. BY THE WAY, THAT'S WHY PEOPLE SOMETIMES STAY TOO LONG." JAMIE, DO YOU HAVE THE ENERGY TO TAKE JPMORGAN THROUGH THE NEXT RECESSION OR WOULD YOU RATHER STAND DOWN AT THE TOP?

DIMON: TO ME, IT'S GOT NOTHING TO - I AGREE WITH HIS STATEMENT, MOSTLY. BUT I LOVE THIS COMPANY, I LOVE WHAT I DO. WHEN I DON'T HAVE THE ENERGY, I SHOULD STEP DOWN. I THINK IF YOU ARE ON THE PLAYING FIELD, YOU'RE THE QUARTERBACK, YOU BETTER PUT ON THE JERSEY AND GIVE IT YOUR ALL. THE SECOND YOU SAY, "I WANT TO TAKE TEN MINUTES OUT OR SKIP A GAME" - YOU COULD BE PART OF THE TEAM, YOU CAN'T BE THE QUARTERBACK. YOU CAN'T BE ON THE FIELD. BUT I HAVE THE ENERGY. AND TO ME, IT HAS NOTING TO DO WITH A RECESSION, THERE WILL BE THE RIGHT TIME. IT'S UP TO THE BOARD, IT'S NOT UP TO ME. AND I THINK WE HAVE GREAT SUCCESS AT THE COMPANY. WE HAVE SOME OUTSTANDING LEADERSHIP HERE, SO WE'RE TOTALLY COMFORTABLE THAT THERE'S PLENTY OF SUCCESSION, WHETHER I'M HIT BY A BUS OR IT TAKES PLACE IN FIVE YEARS OR SO.

FROST: ON THAT TOPIC, ANOTHER COMMENT FROM LLOYD IN TERMS OF STAYING DOWN. HE SAID, " DAVID IS RIPE AND READY AND HE'S THE RIGHT GUY." IS SOMEBODY BELOW YOU READY TODAY IF NECESSARY?

DIMON: YEAH, I THINK THERE'S SEVERAL. AND MORE IMPORTANTLY, THE BOARD THINKS THAT.

FROST: OKAY, FAIR ENOUGH. HAVE YOU GOT ANY ADVICE FOR DAVID SOLOMON AS HE TAKES OVER THE REIGNS AT GOLDMAN?

DIMON: I CALLED DAVID TO WISH HIM MY BEST. I KNOW HIM A LITTLE BIT AND I'M SURE HE'LL DO GREAT. YOU KNOW, THESE ARE BIG JOBS. IT TAKES A LOT TO NAVIGATE ALL THE DIFFERENT PARTS. THE OTHER THING IS WHEN YOU COME OUT OF ONE PART OF THE COMPANY, YOU REALLY SHOULD MAKE SURE YOU FOCUS A LOT ON THE OTHER PART. YOU KNOW, REALLY WALK IN THEIR SHOES, UNDERSTAND IT DEEPLY. AND I'M SURE HE WILL DO GREAT. GOLDMAN IS CHOC BLOCK WITH TALENT. ALWAYS HAS BEEN. YOU MAY NOT KNOW THIS, I WORKED AT GOLDMAN IN THE SUMMER OF 1981. WHICH IS THE SUMMER I THINK THEY BOUGHT JAYARAM, WHICH BROUGHT LLOYD BLANKFEIN TO THEM.

FROST: AND OBVIOUSLY ON TO CITI AND BANK ONE AFTER THAT. JAMIE, YOU LOVE YOUR COUNTRY. YOU COMMENT ABOUT IT VERY OFTEN, AND INCREASINGLY YOU TALK MUCH MORE ABOUT POLITICS THAN PERHAPS YOU DID IN THE PAST. HAS IT CROSSED YOUR MIND TO RUN IN 2020?

DIMON: NO. I MEAN, LOOK, PEOPLE MENTION IT AND IT CROSSES YOUR MIND. I DON'T THINK I'M A NATURAL POLITICIAN. I DO THINK POLICY IS SO IMPORTANT AND I AM A PATRIOT. THIS COUNTRY HAS THE BEST HAND EVER DEALT OF ANY COUNTRY EVER TODAY - IT IS THE MOST PROSPEROUS ECONOMY THE WORLD HAS EVER SEEN. YOU KNOW, IT SHOULD BE GROWING FASTER. WE SHOULD BE HELPING FAR MORE AMERICANS GET JOBS. FAMILIES BACK TO WORK. WAGES GOING UP. AND I SAID, I MADE THIS LONG LIST OF PROBLEMS THAT WE DID TO OURSELVES. AND SO, I DO TAKE IT VERY SERIOUSLY. AND I THINK THE BUSINESS COMMUNITY HAS TO GET INVOLVED TO DO THE WORK TO HAVE PROPER POLICY, TO CREATE GROWTH WHICH IS GOOD FOR ALL AMERICANS. IT CAN'T BE PAROCHIAL. YOU KNOW, WITH BUSINESSES COMING IN, THE ONE THING THEY NEED TO HELP THEM - YOU KNOW THE AMERICAN PUBLIC AREN'T GOING TO BUY THAT. BUT YOU KNOW, THE BRT, WHICH I AM THE CHARIMAN OF, WE TRY TO FOCUS ON - WE HAVE IMMIGRATION POLICY, TAX POLICY, TRADE POLICY, INNOVATION POLICY, WORK SKILLS. GETTING KIDS - WHETHER IT'S HIGH SCHOOL, COMMUNITY COLLEGE - WHEN THEY LEAVE, THEY HAVE THE SKILLS THAT GIVE THEM A JOB THAT'S WELL PAYING AND THERE ARE TONS OF THEM. AND SO, I THINK IF WE FIX THESE THINGS THEN AMERICA WILL BE FAR BETTER OFF.

FROST: DO YOU THINK THERE COULD BE MORE BUSINESS LEADERS THAT RUN? I MEAN, CLEARLY, THE PRESIDENT WAS A BUSINESS LEADER HIMSELF. DO YOU THINK HOWARD SCHULTZ WOULD BE A GOOD CANDIDATE?

DIMON: YOU KNOW LOOK, I HAVE TO LEAVE IT UP TO HOWARD. I THINK THE ROLE THAT HOWARD - YOU KNOW, I THINK IF YOU WANT TO EMBARK ON A POLITICAL CAREER, IT'S A WHOLE DIFFERENT THING THAN CEO. AND HE'S GOT TO EXPLORE AND FIGURE OUT IF IT MAKES SENSE FOR HIM, BUT I THINK HE'S BEEN AN EXCEPTIONAL LEADER.

FROST: I KNOW YOU TALK A LOT AND CARE ABOUT THE OPINIONS OF YOUR FAMILY, AND YOUR DAUGHTERS IN PARTICULAR. HAVE YOU TALKED TO THEM ABOUT HOW MUCH LONGER YOU WANT TO BE CEO FOR?

DIMON: WELL, OBVIOUSLY, I TALK TO MY WIFE ABOUT IT - HI, JUDY - AND MY DAUGHTERS. LOOK, I LOVE WHAT I DO. SO, TO ME I ALWAYS WORRY ABOUT, WHICH I'VE TOLD THEM, IF YOU SAID TO ME, "DO NOTHING," I'D BE LIKE LOST. I PLAY STUFF, I ENJOY STUFF, I DO A LOT OF STUFF, BUT I LIKE WHAT I DO. IT ISN'T LIKE I REGRET IT EVERY DAY I GO TO WORK. I MEAN, THERE ARE DAYS I REGRET, THERE ARE CERTAIN THINGS I HAVE TO DO THAT I REGRET, BUT FOR THE MOST PART, I LOVE WHAT I DO.

FROST: WELL, JAMIE, WE THANK YOU FOR YOUR TIME TODAY. I KNOW YOU ARE VERY BUSY AND THAT YOU LOVE WHAT YOU DO. SO THANK YOU FOR TAKING THE TIME OUT TO TALK TO US.

DIMON: THANK YOU VERY MUCH.

FROST: AND THANK YOU FOR WEARING YOUR "CLOSING BELL" BLUE SHIRT AS WELL THE CHAIRMAN AND CEO OF JPMORGAN, GUYS.



Videos