0:00

From the Bloomberg Interactive Workers Studios.

0:02

This is Bloomberg day Break for Wednesday, May

0:05

thirty. First coming up today.

0:07

The debt ceiling deal clears its first major

0:09

hurdle and heads for a House vote.

0:11

Tonight, JP Morgan holds its Global

0:13

China Summit in Shanghai. We have an exclusive

0:16

interview with Jamie Diamond.

0:17

Elon Musk meets with government officials

0:19

on the second day of his China trip,

0:21

and here.

0:22

What Campy Woods says is the next

0:24

to capitalize on the AI frenzy.

0:26

There is an arrest in the shooting death of a New

0:28

Jersey councilwoman. Plus North Korea's

0:30

attempt to launch his first spy satellite

0:32

ends and failure. I'm Michael barr More

0:35

aheam.

0:35

John stanstowerds War. It's another ten run game

0:37

for the Yankees.

0:38

That a win at Seattle Code I Sanga pits

0:40

the Mets to a shutout of the Philly.

0:43

That's all straight ahead on Bloomberg

0:45

day Break, the Business news You need

0:48

to starn your day in just one fifteen

0:50

minute podcast each morning on Apples,

0:52

Spotify, the Bloomberg Business app

0:54

and everywhere you get your podcasts.

1:00

Good morning, I'm Nathan.

1:01

Hager and I'm Karen Moscow. Here

1:03

are the stories we're following today.

1:05

Let's get you the latest on the debt ceiling deal.

1:07

The agreement between President Biden and House Speaker

1:10

Kevin McCarthy has cleared its first hurdle

1:12

on Capitol Hill after a narrow vote through

1:14

the House Rules Committee. Now the bill heads

1:16

to the full House for final passage as soon

1:18

as tonight. House Majority Leader Steve

1:20

Scalise thinks it will have enough support to cross

1:23

the finish line.

1:23

We have a seventy two hour minimum

1:26

that we allow every member to read the bill, and the

1:28

more that people read in this bill, the more

1:30

they find in terms of real

1:32

conservative victories.

1:34

But conservatives like Texas Congressman

1:36

Chip Roy are standing firm against

1:39

the deal.

1:39

We will continue to fight it today tomorrow,

1:43

and no matter what happens, there's going

1:45

to be a reckoning about what just occurred

1:48

unless we stop this bill.

1:49

One other conservative, Dan Bishop of North

1:52

Carolina, is calling for a vote to oust

1:54

Kevin McCarthy, a speaker over this deal.

1:56

Asked whether he's worried about that, McCarthy

1:58

answered simply.

2:00

Nope, Nathan, So where will the

2:02

votes to pass the bill come from will. House

2:04

Minority Leader Hankeing Jeffries says Democrats

2:07

will deliver enough conbind with the Republicans

2:09

to guarantee House passage of the deal.

2:11

We as Democrats are going to make sure that

2:14

we do not default on our nation's

2:16

debt. America should always pay our bills, but

2:19

it's important for Republicans to keep

2:21

the promises that they've made.

2:23

And House Minority Leader Hankeing Jeffries spoke

2:26

with Joe matthew And and Marie hor Dern on

2:28

Bloomberg's Balance of Power. Catch the program

2:30

weekdays at five pm Eastern on Bloomberg

2:32

Television.

2:33

Well, the debt ceilings getting most of the attention Karen,

2:35

relations with China are also in the

2:37

spotlight this morning. Despite their differences,

2:40

Secretary of State Antonine Lincoln says he

2:42

wants a working relationship with China.

2:44

We are not looking for a new Cold

2:46

War. We're not looking to contain China. I

2:48

think there's a demand signal

2:51

from countries around the world that both

2:53

China and the United States manage the relationship responsibly,

2:56

that we take every

2:59

reasonable step to make sure that the

3:01

competition that we're in does

3:04

not veer into conflict.

3:06

Secretary of State Anthony Blincoln made the remarks

3:08

in Sweden at the EU US Trade

3:10

and Technology Council earlier this week.

3:12

China declined a US request for the country's

3:15

heads of defense to meet in Singapore, Nathan.

3:17

Two of the world's highest powered CEOs

3:20

are in China this morning. Jamie

3:22

Diamond is a JP morgan'st China summit

3:24

in Shanghai. He says the bank will

3:27

be in China for both good times and bad.

3:29

Speaking exclusively to Bloomberg, Diamond

3:31

also says he does not think the US

3:33

will decouple from China.

3:35

Have you asked me over time? Yeah, there'll

3:37

be less trade. You know, it'll

3:40

take years for these things to take place, but

3:42

it won't be a decoupling and the

3:44

world will go on. I think, like I said,

3:46

I think far more important is what's happening

3:49

in Ukraine right now.

3:50

And stay with us for more of our exclusive interview

3:52

at JP Morgan's CEO Jamie Dimond

3:55

that's coming up shortly on Bloomberg Daybreak.

3:57

Along with Diamond, Karen Elon Musk

3:59

is in China as well. The Tesla on Twitter

4:01

CEO is wrapping up the second day of his trip

4:03

to the country where he's been meeting with government officials,

4:06

and we get the details now from Bloomberg's John Tucker.

4:08

John, and Musk is just the latest auto

4:11

big wig to say decoupling from China

4:13

isn't in the cards. In a meeting with the Chinese

4:15

Foreign Minister, Tesla's founders of the interests

4:17

of China and the US are intertwined.

4:20

A government statement cited moss Is saying he's

4:22

ready to keep expanding in that country. The

4:24

comments run counter to efforts by leaders,

4:27

including President Biden, to help d risk

4:29

supply chains and wean the auto industry

4:32

off its heavy reliance on China for electric

4:34

vehicle components. Mosk and other

4:37

auto execs apparently didn't get that memo.

4:39

Just last week, the General Motor CEO Mary

4:41

Barras said she was looking forward

4:43

to working with local partners in China.

4:46

You know, York, John Tucker, Bloomberg Daybreak.

4:48

Right, John, thank you about disappointing economic

4:51

news out of China this morning. Manufacturing

4:53

activity contracted at a worse

4:55

page than in April, while services

4:57

expansion eased. Major average

5:00

in Asia all dropped at least one

5:02

percent.

5:02

Well back here in the US, Karen were just two weeks

5:04

away from the Federal Reserve's next interest rate

5:07

decision. In an interview with The Financial Times,

5:09

Cleveland FED President Loretta Mester said

5:11

there's no compelling reason to pause interest

5:14

rate increases. At the same time, Richmond

5:16

FED chief Thomas Barkin says he needs

5:18

signs that demand is cooling to be convinced

5:21

that US inflation will ease. I

5:23

believe you need to bring inflation

5:25

down by bringing demand down.

5:26

I'm looking to be convinced that demand

5:28

is in fact coming down and that that will then start

5:31

to bring inflation down.

5:33

Richmond FED President Thomas Barkin did not

5:35

comment on what move he's likely to favor at

5:37

the upcoming policy meeting.

5:39

Well, we turned to the markets now, Nathan, and we saw

5:41

in Video's market valuation cross

5:43

the one trillion dollar threshold

5:46

that happened yesterday before the stock went on

5:48

to pair gains. No company embodies

5:50

Wall Street's current obsession with artificial intelligence

5:53

more than in Vidia, but investor Kathy

5:55

Woods says, watch for software providers

5:58

to be the next winner in the AI friends.

6:00

We're onto the next thing.

6:03

Nvidia is a hardware stock. Ensure

6:05

it has some software, but

6:07

the history of hardware and software

6:10

is the bigger beneficiary

6:13

over time is

6:15

going to be software.

6:16

And Kathy Woods flagship Arc Innovation

6:19

ETF cut it's holding it Nvidia on January

6:22

and has missed out on the massive rally.

6:27

Time now to take a look at some of the other stories making

6:29

news in New York and around the world. For that, we

6:31

turned to Bloomberg's Michael Barr.

6:33

Good morning, Michael, Good morning, Nathan. There

6:35

is an arrest in the February first

6:37

deadly shooting of a New Jersey

6:39

consulwoman. Police in Portsmouth,

6:42

Virginia arrested twenty six year

6:44

old Rashid Ali Binam with

6:46

the death of Sayerville council member Eunice

6:49

Juomfor prosecutors say jumfar

6:51

and bid them we're connected through their church. Middlesex

6:54

County Prosecutor Julanda Secone,

6:56

the.

6:56

Murder has shaken the community and

6:59

no arrest.

7:00

We'll bring back the late councilwoman.

7:02

Prosecutor Sacone says surveillance,

7:04

video, cell phone, DEBTA and electronic

7:07

toll information helped them trace

7:09

Bynum's route from his home in Virginia

7:12

to New Jersey and back. So

7:14

far, there is no word on a motive North

7:17

Korea says its attempt to put

7:19

the country's first spy satellite

7:21

into space failed and the rocket

7:23

crashed into the sea. It sent

7:25

people in Japan and South Korea

7:28

scrambling for shelter, fearing it was

7:30

a missile. North Korea vowed to conduct

7:32

a second launch. Republican Florida

7:35

Governor Rond De Santis begins a full day

7:37

of campaigning today with the four

7:39

stop blitz through Iowa. Last

7:42

night, the Santas kicked off his twenty twenty

7:44

four presidential campaign at a

7:46

mega church in Des Moines. He was

7:48

asked about the latest debt sealing deal.

7:50

I can tell you this.

7:51

Our nation was careening towards bankruptcy

7:54

before the debt deal, and it

7:56

will still be careening towards bankruptcy

7:59

after this debt deal.

8:01

DeSantis also fired back at Donald

8:03

Trump after the former president said

8:05

that then New York Governor Andrew Cuomo

8:08

handled the pandemic better than the Florida

8:10

governor. The family of an eleven

8:13

year old Mississippi boy who called police

8:15

to help his family and then was shot

8:17

by an officer is now suing the city

8:19

of Indianola for five million

8:22

dollars. According to the family

8:25

Darrant Murray called the police

8:27

in regards to a domestic dispute,

8:29

but was shot by a responding officer

8:32

in his home. Family lawyer Carlos

8:34

Moore.

8:35

My client, Darren Murray did

8:38

everything right and nothing wrong,

8:40

and yet he still was

8:43

shot aunt blank sent

8:45

Arrange in the chest.

8:47

Family lawyer Carlos Moore called it

8:49

the most egregious case of excessive force

8:52

in his twenty one years of law practice.

8:54

Global News twenty four hours a day, powered

8:57

by more than twenty seven hundred

8:59

journalist natal us in over one hundred and twenty

9:01

countries. Michael Barr and this is

9:03

Bloomberg, Nathan.

9:04

Thank you, Michael.

9:10

Time enough of the Bloomberg Sports Update with John

9:12

Stashauer.

9:12

Thanks Nathan hard delusion. It put up ten

9:14

runs. Yankees won Sunday at the

9:17

Stadium over San Diego ten

9:19

to seven. They went to Seattle and won

9:21

Monday ten to four, and last night it

9:23

was ten to two over the Mariners three runs

9:26

of the first inning and Anthony Volpe

9:28

three run homer in the third, Greg Allen Homard

9:30

and the fourth and Aaron Judge in the seventh

9:32

eighteenth of the season. For Judge Isaiah

9:35

Kiner Fileffa with a big night four

9:37

hits for RBIs Nester Cortez got the winners.

9:39

The Yanks move a season high eleven

9:41

games over five hundred.

9:42

Tampa Bay lost.

9:43

The Yanks are five games behind Mets.

9:46

Back home.

9:46

They lost their last two in Colorado, giving up

9:49

twenty one runs. At City Field, they

9:51

gave up two hits, a two nothing went

9:53

over the Phillies with superb pitching

9:56

from Codei Senga and seven innings.

9:58

Senga allowed one hit, no walks,

10:00

struck out nine. While the Yankees

10:02

were winning in Seattle, so where the Liberty.

10:04

It was the return of Breonna Stewart. She left

10:06

Seattle as a free agent that signed with New York. She

10:09

scored twenty five points against her comer team.

10:11

Upset at the French Joe for the two seed danil

10:13

medvand had lost five sets to a qualifier

10:16

ranked one hundred and seventy second top

10:18

seed Carlos Alcarez playing his second round

10:20

match today, as well as Novak Djokovic.

10:23

While the Rangers continue to look for a new coach,

10:25

two teams made hires, Washington naming

10:27

Toronto assistant Spencer carverret Nashville

10:30

going with Devil's assistant Andrew Burnette.

10:32

Golden State Warriors in a new GM.

10:34

Bob Myers put together teams that won four

10:36

championships. He's resigned after eleven

10:38

years on the job. The NBA Finals

10:40

beginning tomorrow in Denver, and Miami's

10:43

Tyler Hero, who's been out since mid April.

10:45

The Broken Hands, says he expects to play in

10:47

the series. Hero average twenty points

10:49

a game in the regular season. John Stashellen

10:52

Bloodberg sports.

10:55

From coast to coast, from New York

10:57

to San Francisco, Boston to Washington,

10:59

d nationwide on Sirius

11:01

Exam, the Bloomberg Business Appen Bloomberg

11:04

dot com.

11:05

This is Bloomberg Daybreak. Good

11:08

morning, I'm Nathan Hager. Jamie Diamond

11:11

is in Shanghai today for JP Morgan's

11:13

China Summit. It's the first time the bank's

11:15

flagship event is being held in person

11:18

since twenty nineteen. It comes

11:20

as China reopens following strict

11:22

COVID controls, and as tensions

11:24

appear sky high between the US

11:27

and China. Against that backdrop, we

11:29

sat down for a wide ranging exclusive

11:31

interview with JP Morgan CEO

11:34

Jamie Dimond. He spoke exclusively with

11:36

Bloomberg Stephen Engel early this morning.

11:38

Let's listen in to that conversation.

11:40

Now, obviously it's been a few

11:42

years since you've held this in person

11:44

summit. The last time you and I talked

11:46

was at the last time you held one in person in

11:49

Beijing in twenty nineteen.

11:50

A lot has changed. Why

11:53

are you willing to go high.

11:54

Profile as a major CEO of

11:56

a company from America when others

11:59

they want to stay a low profile and keep their

12:01

heads low. How do you assess the US

12:03

Chinel relationship and the impact it's having on

12:05

business?

12:06

Okay, well, for all thrilled to be back again

12:08

after all this time. And it's

12:11

important for CEO to visit their people and their

12:13

clients around the world, particularly

12:15

in when you think times a little more complicated,

12:18

et cetera. But I think it's important for the

12:20

viewership to understand there are like three

12:22

thousand investors here from around the world. There

12:24

are hundreds of companies of Chinese

12:27

and non Chinese companies learning about

12:30

the world. We do research on five hundred

12:32

companies. That research circulates the world and

12:34

hopefully business could be a you know, could be

12:36

for good to help countries lift up. I

12:39

have enormous respect for the Chinese people.

12:41

The Martization's countries has been extraordinary,

12:43

and yes there are some very complex issues that

12:46

have to be dealt with.

12:47

At what point does Jamie Diamond have to become

12:49

the diplomat? Look, Joe Biden has

12:51

not spoken to siegen Ping since November,

12:53

the Bali meeting. Military to military

12:55

discussions are being rebuffed

12:57

and not even happening. Business to business

13:00

is tenuous at best. What

13:02

role can you and should you play while you're

13:04

there?

13:05

Yeah? No, I think I look at a little bit differently.

13:07

So there are conversations took place recently

13:09

that you know have been in the press, which I think you're great.

13:11

I mean it's hard to resolve issues when

13:13

you have the echo chain in your own brain telling

13:16

yourself what you already think. And I think business

13:18

could be a force for good. But I don't

13:20

represent the government. But you know, everyone knows I'm

13:22

an American patriot, so I'm sitting here in China.

13:24

But I'm a red blooded, full throated

13:27

free enterprise capitalist. And so

13:30

the governments have to talk. Every

13:32

government has national security in mind, and

13:34

how do they get better announced

13:36

security? And I should point out

13:39

is that this globe of ours has benefited

13:41

from trade. You know, it's benefited from

13:43

all these things taking place, and so it's

13:46

lifted and even taking this country.

13:48

You know, they have benefited.

13:50

I know this criticism about the American global

13:52

system, but that American global system

13:54

has done an extraordinary It's not American. You

13:57

know, if you go to America, a lot of Americans complain

13:59

about NATO and WTO and WHO

14:01

and the United Nations, but it's lifted

14:03

up. Look what it's done for China. I think that

14:06

the global system has been fabulous

14:08

for China. And they may have complaints

14:10

about it, just like the restros have complaints. But I'm

14:13

thrilled to be here again. You know, you

14:15

have to go see your people and thank your people what

14:17

they've done, particularly through this terrible time

14:19

of COVID, which I think has done a lot of damage

14:22

to the world in a lot of different ways. So getting

14:24

out is the right thing to do.

14:26

Yeah, what is your calculus?

14:28

Has it changed over these four years

14:30

on how you want to expand in China?

14:32

Obviously you're fully licensed up now.

14:34

You are very productive. During the pandemic,

14:37

you got full jvs and full

14:39

ventures in securities and

14:41

the mutual funds and futures. You're

14:45

pretty much well established

14:47

on the mainland, which was your goal, but.

14:49

The things have changed.

14:50

China is not necessarily the be all end

14:52

all anymore. We've had simultaneous

14:55

crackdowns domestically on the platform

14:57

economy, on property, on the online

14:59

game, on online education, not

15:01

to mention COVID zero, you have a

15:03

crackdown on consultancies.

15:06

There's lots of pressure.

15:07

I mean, are you recalculating your

15:09

growth projection and the capability

15:11

of that growth in China?

15:14

You went through a long list there, which I may

15:16

not wint agree with all of it, but I think

15:18

when we do business the country, and we do

15:21

business one hundred countries around the world, we are there

15:23

for the systems of the country, and we're

15:25

there hopefully through good times and bad times.

15:27

We tend not to leave other than there's war,

15:29

civil war, and so we're not predicting

15:31

any of that here. You know, obviously it's become a

15:34

far more complex situation. You

15:36

know, for some for good reason, some not

15:38

for good reason. And you know there's risk.

15:40

There's always going to be risk, and I think you'll see

15:43

companies react to different things for different

15:45

reasons.

15:45

Some of their own resiliency.

15:47

Some is obviously national security,

15:49

you know, will trump all other things. So you

15:52

know, our government tells us do AB and C. We're gonna

15:54

do a B and C and support

15:56

it. And I think there's there's a

15:58

risk in China itself that you know,

16:00

I've met with several people

16:02

here. If you have more uncertainty

16:05

somewhere caused by the Chinese government, well

16:07

of course it's gonna not just change foreign

16:09

direct investment, which has gone up a

16:11

little surprisingly, and I don't think they should

16:13

assume that's continue, but it's going to change

16:15

the people here, their own confidence, their own ability

16:17

to invest and do things, and so, like

16:21

I said, if people have deep conversations,

16:23

respect each other, engage

16:25

properly. I think the American government said

16:28

all the right things recently, which isa. You heard

16:30

it from Treasury Secretary Yellen, You've heard

16:32

from President Biden, You've heard it from National

16:34

Security Advisor Jake Sullivan.

16:36

You heard it from Secretary as day Tony.

16:37

Blincoln, that this is not decoupling,

16:40

this is de risking.

16:41

The world's changed a little bit.

16:43

Obviously, they are concerned about the war in

16:45

Ukraine.

16:45

They should be.

16:46

I think that is probably one of the most serious things affecting

16:49

the future of the globe, and I mean the future of glow for

16:51

the next fifty years. And I think they're doing

16:53

the right things. I'm completely supportive of that. And

16:55

so you know, China's obviously going to do what

16:57

they think is good for itself. And business

16:59

might be a positive attribute, but

17:01

but national security will trump

17:04

all our issues.

17:05

Now.

17:05

I was just at G seven where we heard a

17:08

lot of that rhetoric where they're de risking,

17:10

not decoupling. But again,

17:13

you know, the Chinese say it's one

17:15

and the same. It's it's America trying to limit

17:17

China's rise, and you've

17:19

seen that bifurcation.

17:21

There's more jargon.

17:22

Not to over emphasize all this jargon

17:24

that's going out there, but again, do you see

17:27

d risking being different from decoupling

17:31

totally?

17:32

I mean, look, you know, Stevie, I look at the fact trade

17:34

actually went up and last

17:36

year, and and I think D risky

17:39

means national security.

17:40

Everyone's gonna do. Every country's gonna turn out their

17:42

own way. You know.

17:43

Now we're talking about very advanced chips, but kind

17:45

of reasonable, you know, not to help non

17:48

allies have things that can help their military. You

17:50

know, obviously there are you know, rare earths and

17:53

things like that, so America's going to look at that. They

17:55

were very clear, they tumbautic. They used

17:57

the word, you know, a small garden

17:59

with high walls as opposed to everything,

18:02

and we should hope that let's not make it everything.

18:04

I think the business Comunity is trying to help advise them, and that

18:06

then there's going to be companies doing things just

18:08

for their own resiliency. That's a perfectly

18:11

reasonable thing to do too. And then there's

18:13

the big one, which is also this constant

18:15

negotiate about trade on fair trade,

18:17

free access, fair access that's been going

18:19

on with for my whole life about every

18:21

country, and the countries should learn about

18:24

when they're legitimate concerns and when

18:26

they're not legitimate concerns, and like listen to

18:28

each other deeply and adjust

18:30

accordingly. So if you ask me, over

18:32

time, yeah, there'll be less trade.

18:35

You know, it'll take years for these things to take place,

18:37

but it won't be a decoupling and the

18:40

world will go on. I think, like I

18:42

said, I think far more important is what's

18:44

happening in Ukraine right now, and

18:46

so hopefully this will sort

18:48

out, and it will never sort out if people don't talk.

18:51

So I urge people you have some real

18:53

deep conversation. You get to know each other a little bit,

18:55

a little bit each other's concerns about some of these issues,

18:58

and things would be better we

19:00

had that.

19:02

Well, do you have these conversations as well,

19:04

because a lot of people do

19:06

try to extrapolate what's happening in Ukraine

19:08

with the potentiality in East

19:10

Asia with Taiwan. We know Warren

19:13

Buffett has divested completely

19:15

its investment Berkshire Hathaway's

19:17

investment in Taiwan's semiconductor. There's

19:20

nervousness and that creates hesitancy

19:22

for investment and fun flows which

19:24

are down. Obviously trade deals

19:27

are down. Do you see the direct correlation

19:29

of the risks that have risen

19:31

in East Asia because of Taiwan

19:34

because of what's happening in Ukraine

19:36

exacerbating that.

19:38

Yeah, I think I'm not an expert on

19:41

Taiwan, and I would defer

19:43

to Bob Gates and Henry Kissinger about

19:45

how to de escalate that situation and

19:47

obviously as to the tension things like that.

19:50

But remember this is a world issue,

19:52

but all the country around the world would

19:54

be concerned about Taiwan.

19:56

And the outcome of that.

19:57

I think when Ukraine showed people is

19:59

that the world wasn't safe that you

20:01

know, oil and gas supply chains aren't safe, food,

20:03

the supply lines aren't safe. You know, everyone's

20:06

starting to relook at what is national security?

20:08

Had Germany important?

20:09

I think it was half of their natural gas from Russia,

20:11

So I think that did cost people. Look at what

20:14

are their alliances, what are their trade what

20:16

are the things? And obviously it's causing a

20:18

lot of confusion and a lot of issues. But hopefully

20:22

we'll make a lot of progress on it. Like I said, that

20:24

comes with engagement, and that comes with you

20:26

know, the don't want the American government and

20:29

other folks, you know, city down.

20:31

Yeah.

20:31

I don't want to keep on harping on the negative side

20:33

of it, but is there any scenario, the worst

20:36

case scenario that would make

20:38

your investment, and look, it's a sizeable

20:40

investment in China, make it untenable

20:43

for you?

20:43

You know, Steve, you're

20:45

going here, You're going to repeat yourself over and over.

20:48

We're here, We're going to support the Chinese

20:50

people, of the Chinese governments. We do

20:53

business with a thousand companies here. Half

20:55

are multinationals coming in half

20:57

are local companies. You

21:00

know, we always have managed our risk that

21:02

we can handle almost whatever happens around

21:04

the world. And I am an American patriot.

21:07

I will do what my government tells me. I'm going to salute

21:09

like anybody else. But I can tell them what

21:11

I think, and you could imagine that I've been

21:13

very clear when I sit down with them what I think and

21:16

what we think matters. And like I said, a lot of the business

21:18

community think could be very helpful in that this

21:20

is not a simple matter, and sometimes

21:22

we oversimplify things in a way which actually

21:24

damage, you know, the ultimate outcomes.

21:27

Will you have an opportunity, Can you reveal

21:29

whether you're going to meet with Lee Cheung,

21:32

the premier, or any of the other senior

21:34

Chinese leaders, and what would you like to get from

21:36

them.

21:38

I'm me with a very limited

21:40

amount of Chinese leaders. I met with one,

21:42

but I'll keep that conversation private. And like

21:45

I said, you know, I'm here for our people.

21:47

I'm here for these clients. I think it's great

21:49

that this is taking place. I think humanity is

21:52

better off this type of thing, and obviously

21:54

national security will reign supreme and

21:56

so. But but you don't stop doing

21:58

one because of the other. And so, like

22:01

I said, I'm thrilled to be here. And it's amazing,

22:03

which what I've seen take place in

22:05

China the last twenty five years partially

22:08

because of the global system, and I

22:10

think they should be clear about that. And you

22:12

know, they have their own problems

22:14

here. You know, twenty percent of employment on youth.

22:16

I mean, that's a scary number. And so you know, growth,

22:19

they need growth too, and confidence is

22:21

very important for growth.

22:23

When do you see cross border deal making picking

22:25

up? It's been quite a nator

22:27

on that front.

22:31

Course, border between China and other people are

22:33

just globally.

22:34

Right, Well, let's let's

22:36

talk about China, say China US or

22:39

outbound from China and the like.

22:45

Outbound you know, I don't know the answer

22:47

to that. I think there are always a lot of

22:49

more conversations, you think, and obviously

22:51

it's been damped a little bit. I think America

22:53

is still open for business. You know, Chinese

22:55

comans is gonna be a little concerned. You know, we've we've had

22:57

siphias for a long time now. But I would

22:59

say we're still joint over for business.

23:02

And if you're in a Chinese company you want to do something,

23:04

you know, look at it, don't

23:06

back off just because you're afraid of something, and

23:08

you get some advice and help and how you go about that

23:10

the right way. But America is still

23:12

open for business, and I think you've heard that from

23:15

Secretary Yellen, Secretary

23:17

Blinking and all those

23:19

we still believe in, you know, open and Philly free

23:22

markets.

23:23

Let's pivot to what's happening in the United States.

23:25

Obviously, the debt ceiling impasse

23:27

is coming to a head, perhaps with a House

23:30

vote coming up.

23:31

Can you kind of tell me.

23:32

What your war room, your debt ceiling warroom is

23:34

advising you on the unintended consequences

23:37

a of a default or even b the

23:41

ramifications even if a deal

23:44

is done in Congress, on whether

23:46

that could mean you know, higher rates, as

23:48

well as we head towards a possible mild

23:50

recession.

23:51

So I, first of all, I think Kevin

23:55

McCarthy, King,

23:57

Jefferies, the President, Chuck

24:01

Schumer, mission mcconna all

24:03

did a great job. And I think it's

24:05

great. This is this is democracy and

24:07

bipartisanship, and I think they did the right thing, and

24:09

I think it's going to happen. If I thought it wasn't going to

24:11

happen, I probably wouldn't be here right now. Uh

24:14

So, And obviously it's got to get through a couple of votes

24:16

in Congress, and our people pretty

24:18

comfortable will happen. You know, I've

24:20

been We've been public for years. If if

24:22

you actually an actual default, it's not good.

24:25

You know, America, the financial system America

24:28

and the economic economy of America. It's

24:30

still the most prosperous and largest economy of the world

24:32

I've ever seen, the most innovative, the most growing,

24:34

and the rest of the world relies on it, you

24:37

know, So I think we shouldn't create any instability

24:39

there. So I wish one day we'd

24:41

get rid of the whole debt ceiling thing. But I understand,

24:44

when you know, it's a democracy, people have different

24:46

opinions about what we should be doing, and it's

24:48

just one tool for one party to you

24:50

know, get the other.

24:51

Part of the table.

24:52

So I'm quite optimistic there, and

24:54

I really do applaud the fact that they all sat down

24:56

and spoke got something done.

24:58

What's your read on inflation?

24:59

On when whether the Fed will go beyond

25:01

the pause and hike again.

25:04

You know, my simple view is

25:06

that their right to pause at this

25:08

point has been a big increase, you know, five hundred

25:11

basis points to so take a pause.

25:13

But I do think it's possible they're

25:16

going to raise a little bit more. Then the inflation

25:18

is kind of stickier. I think people are coming

25:20

around to that, which means race may have to go up a little bit

25:22

more. People should be a little prepared

25:24

for that. There's just as a matter of manage

25:26

your own business, be a little prepared for that, whether

25:28

you're a financial company or a real estate

25:31

company, et cetera. I think the other thing

25:33

I'd be a little prepared for is the volatility that might

25:35

very well be created by quantitative tightening. We've

25:37

never really had quantitative easying, which we've

25:39

had now for the better part of fifteen

25:42

years, and now you're going to see quantitative tightening,

25:44

and I think the effects may be a little harsher

25:46

than people expect, but hopefully we'll

25:48

get through all of that and be okay.

25:51

How would you assess the banking crisis whether

25:54

we're still facing a banking crisis?

25:56

Obviously you come from a very interesting

25:59

purche having taken over a first Republic,

26:01

do you see more pain coming down to what needs

26:03

to be done on the regulatory front to prevent this

26:05

from happening again.

26:07

Yeah.

26:08

So the first thing is it's nothing

26:10

like oh wait, there's nothing like that.

26:12

Leverage in the system.

26:13

The private the private companies are

26:15

in actually very good shape. The banking

26:17

system is in pretty good shape. You've seen regional

26:19

banks just report very good numbers. The

26:22

deposits didn't run out like people are talking

26:24

about. This is nothing like that. There

26:26

are a couple of banks that are offside this. That off

26:28

side is an industraight exposure and things

26:31

like that, First Republic being one of them. We

26:33

were asked by our government to step in and we did and

26:35

we were able to handle it. I'm extremely

26:37

proud. I hope Jen Peepzak and Marion

26:40

Lake will look at me now like what you all have done. Get

26:42

an airplane Sunday night to fly out talk

26:44

to people. You know, obviously it's a lot

26:46

of work and you know, hard for people,

26:48

but we're trying to show real humanity, you

26:51

know, using redeployment of anyone

26:53

who lose their job is trying to find other jobs. At

26:55

JP Morgan or elsewhere

26:57

we had the cability to handle it. I think it's also

26:59

a side by the way, because we totally

27:01

support community banks, we totally support

27:04

regional banks. I would be carefully

27:06

taking what regulations have to be done as opposed

27:08

to supervision, and we want

27:10

them to do well. So I want to be very

27:12

quite careful people go about that. So these

27:15

this banking system, you know, we acknowledge their community

27:17

banks do a lot of things we can't do. And

27:19

so I think there are a critical part of the system.

27:22

But so is a JP Morgan. You know, we bank

27:24

small companies, large companies. We bank the IMF,

27:27

the World Bank, We bank cities, stools,

27:29

states, hospitals, We bank companies in thirty

27:31

countries, you know, And so there's a reason

27:33

that you have both large and small

27:35

and all different types. And so I

27:38

think we're over this part of it for the

27:40

most part. There may be something else, but

27:43

rising rates, if they get high

27:45

enough, it careers uglyhead again. And so

27:47

I think, like I said, it's not just banks. People should be prepared

27:49

for slightly higher rates than they've been used

27:51

to in the past fifteen years.

27:54

Are there further redundancies necessary associated

27:56

with First Republic. We knew we were going to get a

27:58

plan from you guys by the end of the month. It's the

28:01

end of the month. We know, maybe a thousand

28:03

jobs cut, but there's seven thousand employees.

28:05

There is there anything you.

28:07

Can reveal on what further tightening

28:09

is necessary as you integrate that bank.

28:12

No, you know, they I think the thousand bud it was less

28:14

than what they had planned to do on their own. And

28:16

we need a lot of people, and we know we have a

28:18

lot of you know, we hire a lot of people to hear, so I

28:20

use the word redeployment. We're hoping

28:22

that almost everyone who might lose their

28:24

job, you know, and there might be some more, but almost

28:27

everyone, we could say, hey we have this other job

28:29

for you in the same city, you know, or

28:31

something like that. So you know, we're pretty good

28:33

at that and hopefully we can provide opportunity.

28:36

You know, we welcome the.

28:37

First First Republic people of

28:39

a company. We're treating them with great humanity. I hope

28:42

we're going to learn a lot from them. You know, very often when you

28:44

have to do a do like this, you know, people are angry.

28:46

We're not.

28:47

I've never been part of a company. We didn't buy

28:49

someone to merge someone where you don't learn somebody from

28:51

both sides, and so you know they have this wonderful

28:53

wealth uh business, you know, uh in

28:56

banking and wealth management, and you know we're

28:58

we have a few things to learn to do. I

29:00

mean, I've never seen I've gotten so many emails

29:02

from very happy customers and

29:04

that's a great thing.

29:05

So what can we learn and what can we do better? For JP?

29:07

Morgan Jayson?

29:08

Now, Jamie, I know last week you talked

29:10

a lot about succession or about your

29:13

position, that you're not talking about retirement

29:15

right now. I do need to ask you though, And your

29:17

name has been bandied about for years

29:20

about public office. I

29:22

mean, I don't think Wall Street's too pleased about the potential

29:24

Trump versus Biden runoff next year.

29:28

Is it any has that scenario

29:30

ever crossed your mind that you would run

29:33

for public office or even accept a cabinet

29:35

position.

29:37

You know, obviously it's crossed my mind because

29:39

people mention things to you and stuff like that.

29:42

I love my country and maybe one day I'll serve

29:44

my country in one capacity or another.

29:46

But I love what I do.

29:47

I think Jadie Moore can do a great job for

29:49

helping Americans, helping countries around

29:51

the world.

29:52

And this is my job.

29:53

This is what I'm going to do, and I'm quite happy doing

29:55

it. I still have the energy to do it. I mentioned you

29:58

know that when you don't, I think people should

30:00

give up the job if you've got a fabulous management

30:02

team where I really enjoy working with.

30:06

So now I'm here, David

30:08

Diamond, thanks so much for your time.

30:10

I'm Bloomberg.

30:11

Thank you.

30:13

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