Dimon On Regulation And Why He Won’t Fight It

If there’s one word that doesn’t describe JPMorgan Chase CEO Jamie Dimon it’s “shy.”

Particularly when it comes to talking quarterly earnings, Dimon has had his fare share of one-liners. Like when he once said during a quarterly earnings call: “I’d like to stop stepping in dog****, which we do every now and then.”

And while Dimon’s most recent comments to Bloomberg about quarterly earnings weren’t quite as salacious as those colorful comments, they certainly got their fair share of coverage from the mainstream media about what he really thinks about quarterly financial reports.

“Don’t make earnings forecasts. You don’t know what’s going to happen every quarter. I don’t even care about quarterly earnings,” Dimon said in the interview with Bloomberg.

While it’s easy to jump to conclusions about what this bullish CEO rattled off on the news show, there’s a bit more context that not every story focused on. What Dimon also said about earnings calls is that some CEOs “start making promises they shouldn’t make.”

The interview — which discussed everything from earnings to economic growth China and Europe — also dove into what Dimon had to say about big banking regulation post-financial crisis. Which, to him, means abiding to what the regulators have to say, regardless of what the bank thinks is best.

“It’s impossible for a bank to fight the United States government,” Dimon said. The alternative would be to do battle in court and have to pay anyway, he said.

He also spoke to the concept of a unified regulatory system, which he said would be a good move for big banks like JPMorgan. He recognized that the financial crisis tainted some consumers’ views of the financial industry, and emphasized that all he can do is be honest, and follow the regulations thrown at his bank.

“When the narrative was that all the banks were bailed out, that became the narrative and you can’t battle that,” Dimon said in the interview. “All I can really do is tell the truth.”

For Dimon, he’s not about to let the details bog him and his vision for JPMorgan down. This means everything from regulation to earnings.

When it comes to earnings, Dimon said he’s focused more on long-term growth than crunching numbers quarters at a time. As for analysts, Dimon suggested that corporate leaders should be cautious on their earnings guidance, particularly because he said long-term performance means more for a bank’s overall health than a few months outlook at a time.

Adding to that point, Dimon noted that the bank’s shareholders “completely appreciate” having a long-term financial perspective on their investments. Alternatively, that doesn’t stop some from reacting to short-term earnings results strongly, which he emphasized is the wrong approach to take.

Dimon also said that when it comes to quarterly earnings, he’s had little impact on the most recent quarters, remarking: “As a matter of fact our quarterly earnings are based upon decisions that have been made over the last five or 10 years.”

 

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