Jamie Dimon Tells FBN, "I Hope They Raise Rates" In 2016

JPMorgan Chase Chairman and CEO Jamie Dimon spoke with FOX Business Network’s (FBN) Maria Bartiromo about the whether he thinks the Federal Reserve will raise rates in 2016 and about the stock market. When talking about the Federal Reserve Dimon said, “I hope they raise rates because I think normalization is a good thing, not a bad thing.” Dimon also commented on the stock market saying, “I’m not worried as people are really worried” and “if you look at the world, in the United States, the economy’s still chugging along. I wish it was going faster, but it’s strong.”

Jamie Dimon on the stock market:

“I’m not worried as people are really worried, but — look, if you look at the world, in the United States, the economy’s still chugging along. I wish it was going faster, but it’s strong. It’s very broad based. Consumers are in good shape. Household formations are going up. Businesses are in good shape. Credit’s in good shape. The financial system is very strong. I think it’s all China, you know? China had uninterrupted growth for 20 years, 10 percent like clockwork. And, as they go to this, kind of, transformation to a market driven economy, reducing corruption, it’s going to be more turbulent, and I think what the world’s learning right now, China’s going to be slower growth, but, you know, more volatility. It’s making people a little nervous.”

Jamie Dimon on whether he thinks the Federal Reserve will raise rates again in 2016:

“Yeah, so, I think there’s so much focus on that rate rise. They raised the rates and didn’t actually mean that much. You have to ask the question, why are they raising rates, and the reason has been because the American economy has strengthened. That is a good thing. So, the more the economy is strengthened, the more they raise rates, together that’s a good thing…. If they have to reduce them again because our economy is, you know, going back into some kind of recession, that would be terrible. But, like I said, the economy seems to be OK. The Fed does forecast for rate raises, if you look at their dots. The market has too. It’s probably a pretty huge discrepancy in such a short period of time. No one really knows what’s going to happen down the road… So, I hope they raise rates because I think normalization is a good thing, not a bad thing.”

Jamie Dimon on Goldman Sachs out with a report on downgrading JPMorgan:

“Goldman Sachs. You know, listen, I saw that. He said they accomplished, and you had the benefit where we said what they were going to do, and I think they think that we’re quite a good company, so…You know, look, analysts have their opinions, and some of them want to buy, and some want to sell, and that’s what makes a market.”

Jamie Dimon on why we are so nervous about China:

“It was predictable, and it’s become less predictable. So, you know, if we have the second largest economy in the world becomes less predictable, that just makes everyone a little skittish.”

Jamie Dimon on corporate lending:

“Good question to answer. So, if you — small business, and middle market is — they’re still borrowing. Credit is very, very good. They’re not doing what you and I would call bull market, kind of, capital expenditures, but they’re still doing capital expenditures. Big companies, it looks like, capital expenditures are disappointing. And, I think that’s disappointing because growth has been slower, you know?”

Jamie Dimon on whether there is another area of the world that he sees attractive right now:

“Yeah, I mean, in China we still — you know, our view in China is that 20 to 30 years from now, the likely outcome is that they will house, you know, 30 percent of the global fortune 2,000, and, you know they have a lot growth to go. It may be rocky times in the meantime, but the big difference is that that is — that’s still the likely outcome. So, we want to manage the turbulence, but make sure we invest properly. You know, if you — if you, if we were at risk committee meeting, I think it was in India, and people are talking about the risk, and the corruption, and the problems, and the low growth, and it was a year or two ago. I said, you know, if you were having a risk committee meeting about America in 1870, you would have said the same thing, you know? It just had a civil war, it had a racial problem, there’s, like, tons of corruption, it’s polluted, you know? And, people were shipping money to the United States to industrialize it, and it was coming from Europe, OK?And, so, you got to keep your eye on the long ball too. And, you know, we are in the stock market, and then when we’re there for people, for your company, we’re there for good. We’re working for good with them, we want to do it everywhere. As you grow, we grow, we serve you in different countries, and so, that’s kind of our view. And, then, we manage through the weeks, and the months, and the years.”

Jamie Dimon on the impact of the drop in oil:

“Yeah, so, you know, there’s an industry where, obviously prices have changed. Remember, commodity prices change like this all the time, and all different commodities, so you should somewhat be prepared for it… I think we told the world that if oil goes to $30 dollars and stays there for 18 months it would cause us to increase reserves by something like $500 million dollars, you know? Which is fine, we’re still going to help our company — these companies get through it, our clients. It’s important that they — by the way, that we’re there in good times and bad. You can’t be a bank, and the second something goes wrong you go running. So, the beneficiary of lower oil prices, right? So, it’s bad for Brazil, it’s good for India. So, it causes different flows in the countries around the world, but it’s good for consumers, and businesses. So, all those who consume energy are paying lower prices. We think, you know, we have JPMorgan Chase Institute which uses real data that they are spending 80 percent of the gas increase — decrease. And they’re spending it in T&E, maybe, maybe bigger SUV’s and houses, but it’s very — kind of the benefit is a little bit — it’s better because a lot of things as opposed or two which is being, you know, badly hurt. It’s good for the American consumer. Gas is at $2 dollars, and if you adjust for inflation it’s kind of the same price is was at 1960, I’m told.”

Jamie Dimon on whether credit quality is OK right now:

“Well, that’s the other thing, this — the average consumer has another $700, $800 dollars in their pocket every year, that’s good for consumer credit too. So, you know the benefit, like I said, it’s a little bit everywhere, as opposed to a very narrow slice that’s being hurt, or helped.”

Jamie Dimon on cost cutting:

“We never actually do what are called cost cutting. I mean, we’re always adjusting, trimming our sales, and trying to — I call it waste cutting. Get rid of the things you don’t need, get rid of them all the time. We would never stop doing the things we need, technology, marketing, you know? People in certain countries, and areas so. What we showed the world are our cost would be coming down, and we’re meeting — pretty much meeting or exceeding what we told the world we’d do. But, we’ll always be investing in the future. We find opportunities investing, and we’re going to do that too.”