At the JPMorgan Healthcare Investment Conference today, Jamie was entertaining and outspoken as usual:
“But for bad policy, this country would be booming.
I’m positive I’m right; I just can’t prove it.”
Are you more bullish than the average economist?
“Not even close. The economists are right only if policy remains bad forever. They say the tech boom was a one-time event. Are they insane? Technology is like dark matter. It’s everywhere. It infuses everything.”
“When I hear people in D.C. complaining, I tell them Washington has been dealt the best hand anywhere, ever. We have a strong military, university system, small, medium and large business environment, the most innovation, the least corruption, and liquid capital markets across the whole mosaic from venture capital to public equities. But I am very worried about the long run, over 30 to 50 years. We don’t have a divine right to continue succeeding. We have to fix immigration and education and have a rational energy policy. We have been profligate and stupid in our use of oil, and now we have been given a second chance. We should use it wisely.”
“I’m still a Democrat, barely.”
“There has been a tsunami of regulations, often misguided. Small banks can’t survive. After five year, we don’t know the mortgage rules yet. The liquidity rules were ridiculous, and they came back to a rational place. I haven’t read the rules yet, but they sound reasonable.”
What can we do to bring the political parties together? “I’m going to say Martini’s man! It’s a social issue, not an intellectual one.”
What did you learn form 2012? “Don’t screw up. [laughter] But we are a better company because of it. We were scared, and we cleaned it up. I have made a lot of mistakes, and will again, but this was a doozy. I hope it was the worst mistake I make. Imagine how many people came into my office crying. Some leaders acted like children. Some asked how they could help. It’s invaluable to find who these people are.”
Who are your living heroes? “Living? I was going to say Lincoln. Ok, so I’d say Nelson Mandela and Jack Welsh.”
Should the government be in the mortgage business? “It depends on how. The government could offer bond guarantees but have industry pay for it. Like FDIC, the government does not fund it, we do. The government should never have a portfolio. They had a huge portfolio of mortgages. That was the biggest financial disaster of all time, bar none. It was given to us by the government who then blamed the banks.”
Is the Euro crisis behind us? “God no. It’s like a roller coaster. You have not heard much about it recently, but something will happen in the next three months that will scare the hell out of you. Why do we have the EU? One, it’s a political union to avoid wars. And two, it’s a common market. They can’t exit without going into depression. So it will be a roller coaster and it will take years to work out. They might have modest growth through that period.”
Will the U.S. follow the same course as France, Spain, Italy? “We don’t have the same values. While there was disagreement before, no one denies the fiscal problem today. We are a democracy. Countries and individuals may not want to work hard. To work 30 hours a week,. That is a choice that can be made, and it’s not immoral. Maybe they don’t want the stress. They will be sub-par economically, and they have to be OK with that. They can’t say that the answer is to transfer wealth from those who do work hard.”