The is our second visit to Mr. Dimon and his letter to shareholders, the first being April 5's "Seize property to build wind and solar farms, says JP Morgan chief".
Again, the Letter to Shareholders from Jamie Dimon, Annual Report 2022 | JPMorgan Chase & Co.:
....Second, an industrial policy, done properly, could drive growth and also protect our national security.
The United States has essentially never had an “industrial policy,” a strategy by which the federal government, through incentives and policies, drives American industry. We have done it indirectly through things like the Defense Advanced Research Projects Agency and NASA’s moon mission but not generally by favoring industries. More directly, the IRA and the CHIPS Act provide specific incentives for EVs, semiconductors, rare earths, alternative energy sources and others. There are two reasons we should develop an industrial policy: 1) specifically to safeguard our national security and 2) to counter unfair economic competition, particularly where our national security is directly concerned. For example, making bicycles would not be part of the second example. But China, using subsidies and its economic muscle to dominate batteries, rare earths, semiconductors or EVs, could eventually imperil national security by disrupting our access to these products and materials. We cannot cede these important resources and capabilities to another country.
Crafting an industrial policy should be done properly and with a tightly restricted scope. If the policy is politically motivated, it will be used to benefit various political benefactors and eventually provoke extreme misallocation of capital and corruption. Managing the economy is extremely complex, and Adam Smith’s invisible hand still prevails — in a way we can never understand. If the government starts to micromanage through an industrial policy, it will not stop, and much of the efficiencies meant to be created will not be realized. Industrial policy should come with twins — very strict limitations on political interference and related comprehensive policy around factors like permitting requirements, which if not drastically improved will inhibit our ability to make investments and allow infrastructure to be built.....
We'll have more on U.S. Industrial Policy this weekend.
Today JPM is up $9.60 (+7.44%) to $138.59 on earnings that blew past estimates and guidance that basically said the Fed is doing exactly what Mr. Dimon dreams of:
....The bank also boosted a key piece of guidance that bodes well for the near future: Net interest income will be about $81 billion this year, about $7 billion more than their previous forecast of $74 billion, CFO Jeremy Barnum said Friday.
The change was mostly driven by expectations that JPMorgan will have to pay less to depositors later this year if the Fed cuts rates, he said....
—CNBC
