RobinHood Conference: Dimon Warns China To Prepare For Recession

We are posting Robinhood Conference notes so please stay tuned for much much much more. Below is the talk between Jamie Dimon and Lee Ainslie on politics, bubbles, fed policy, China and much more. Note this is not a verbatim transcript and is for information purposes only. We will be creating a PDF version of this document for our premium members.

Also see more Q3/Q4 hedge fund conferences and letters

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FIRESIDE CHAT WITH JAMIE DIMON
Speaker: Jamie Dimon (CEO of JPM) with Lee Ainslie (Founder of Maverick Capital)
A collaborative relationship between the banks and Federal Reserve would be appreciated. All Federal reserve candidates being floated would do a better job.
Tightening will continue although it may not be a benign environment.
Jamie expects the rates to be more volatile. While the rates are expected to go up, it will happen slowly and not as fast as people anticipate.
The most significant risks for the next bubble according to Jamie are:
If you believe the next few years will be good, then low spreads are justified. However, if you think that there will be a recession, then they are not justified.
Quantitative Easing
Trade in general. There will be more trading in China instead of using the North America Free Trade Agreement.
Imbalances in the area have built ways people are not prepared for.
There is always a risk when it comes to geopolitics.
There is faith that China can sustain growth even if they might face banking problems.
Jamie believes that China can sustain growth.
They can recapitalize their banks and overcome the debt problem they have.
Shortly, the country will go through a recession eventually even though he has no idea when that will be. What we do know is that China is not prepared for one.
Jamie’s advice for China is:
They should make their financial system more transparent.
They should merge the State-Owned Enterprises and change the Business Operating Division. You cannot have massive, insufficient SOEs and support local businesses and expect to have an efficient economy.