JPMorgan’s Dimon Says Brexit Looms While ‘Something’ Wrong with U.S.

In his latest, much perused annual letter to shareholders, JPMorgan Chase & Co. CEO Jamie Dimon gave a mixed assessment of some of the larger issues confronting the United States, touting its strength as a nation even while “it is clear that something is wrong” with this “exceptional country.”

As a new administration settles into Washington, D.C., policy changes may be writ large and small; particularly in Dimon’s own banking industry, his concerns cover expansive ground. Among them, the Millennium has seen funding of wars and debt to the tune of trillions of dollars. He singled out well-educated foreign students schooled in the U.S. being told to depart as a harbinger of pressures to come, even as corporate taxes have been, as he sees it, high enough to move businesses to seek opportunities beyond U.S. borders.

Wrote Dimon, who listed these and other problems, such activities here in the U.S. “can understandably lead to disenchantment with trade, globalization and even our free enterprise system, which for so many people seems not to have worked.”

Dimon has been known for what Bloomberg News has said is an optimistic outlook, and this time around that may not have translated well to the larger picture, manifesting in a shift from his “typical tone.” Brexit, he noted, looms as having, upon the U.K.’s economic departure, potentially “devastating economic and political effects” tied to a “hard exit.” For JPMorgan’s own operations, some changes will be in the offing. As Bloomberg has noted, the firm has been in talks to gain presence in Ireland, via an office building buy.

Looking at bank and financial regulation closer to home, Dimon stated that the Financial Stability Oversight Council, which traces its gestation from the Dodd-Frank Act, should be revamped, adding that corporate taxes in the U.S. are too high and cause “considerable damage,” with the impact of “driving capital and brains overseas.”

Dimon seemed a bit more sanguine on ways to boost financial activity domestically: He noted that changing the mortgage markets via reforms could boost lending by $300 billion annually, lowering borrowing costs by several basis points; the beneficiaries would be first-time homebuyers.

For JPMorgan, the company has been busy funding technology initiatives, and the CEO said in his letter that $9.5 billion left corporate coffers via tech spending and $600 million was earmarked for FinTech projects.