Billionaire investor Ray Dalio says his comments on China’s disappearances were misunderstood – after he said Beijing was being a ‘strict parent’

Ray Dalio on the Forum stage during day two of Web Summit 2018.
Ray Dalio has raised $1.3 billion for a private fund in China, according to Bloomberg.

  • Ray Dalio said he “sloppily answered” a question on Chinese human rights, which led to a misunderstanding.
  • Last week, the billionaire investor likened Beijing to “strict parents” when asked about China’s record.
  • The Bridgewater boss is making big moves in China, and is one of many caught up in a debate about investing there.

Billionaire investor Ray Dalio said he answered a question on China’s human rights record “sloppily,” which led to a “misunderstanding” of his views, speaking as he defended his investments in the country.

After coming in for criticism for comments made to CNBC last week, Bridgewater Associates boss tried to clarify his position in Twitter thread and a post on LinkedIn over the weekend.

“I sloppily answered a question about China from Andrew Ross Sorkin that created a misunderstanding of my views,” Dalio tweeted Sunday evening.

He added: “I’m sorry my answer lacked that nuance and caused confusion.”

Last week, Dalio was asked about China’s human rights record by CNBC’s Andrew Ross Sorkin, in light of the disappearance of top tennis player Peng Shuai from the public eye.

In response, the investor said he “can’t be an expert in those things,” but went on to compare Beijing to a “strict parent.” 

Those comments drew a strong backlash, with Senator Mitt Romney saying Dalio’s investments in China were “a sad moral lapse.”

Dalio, the founder and chief investment officer of Bridgewater Associates, the world’s biggest hedge fund, raised $1.3 billion for a new Chinese private fund, according to Bloomberg.

Romney tweeted last week: “Ray Dalio is brilliant and a friend, but his feigned ignorance of China’s horrific abuses and rationalization of complicit investments there is a sad moral lapse.”

At the weekend, the American investor said he was attempting to explain what a Chinese leader had once told him about Beijing’s approach to governing.

“Confucianism is based on the family, and that extends into their governance, which is a more autocratic approach,” he wrote. “I was not expressing my own opinion or endorsing that approach.”

He explained his investments in China by saying Bridgewater’s clients “​​rely on us to invest in the best possible ways in all the countries.”

In addition, he said he weighs the pros and cons of investing in China in light of human rights issues, although he did not directly address Beijing’s alleged activities.

The Chinese government has long been accused of stamping down hard on dissidents, including the removal of high-profile figures from public view.

Most recently, human rights groups, governments and the Women’s Tennis Association have raised concerns about the fate of Peng Shuai. The tennis player accused a senior member of the Chinese Communist Party of sexual misconduct, and was then not seen for about three weeks.

Many investors and institutions are grappling with the thorny issue of China. Hedge fund titan George Soros slammed BlackRock earlier this year, saying the asset manager’s big push into China is a “tragic mistake.”

JPMorgan boss Jamie Dimon apologized in November for making a joke that his bank would outlast the Chinese Communist Party.

Read more: China’s regulatory crackdown has been squeezing hedge fund favorites like Didi and JD.com. Here’s how billionaire investors like Philippe Laffont are playing the chaos.

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Jamie Dimon says he ‘regrets’ his joke that JPMorgan would outlast China’s Communist Party

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JPMorgan CEO Jamie Dimon

  • Jamie Dimon apologized for a joke he made about JPMorgan outlasting China’s Communist Party.
  • “I regret and should not have made that comment. I was trying to emphasize the strength and longevity of our company,” Dimon said in a statement. 
  • Dimon made the joke in reference to the the hundredth anniversary of China’s Communist Party. 
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Jamie Dimon on Wednesday apologized for a joke he made about JPMorgan outlasting China’s Communist Party.

“I regret and should not have made that comment. I was trying to emphasize the strength and longevity of our company,” Dimon said in a statement that the bank emailed to Insider. 

Hours after, the CEO apologized again via a spokesperson.

“I truly regret my recent comment because it’s never right to joke about or denigrate any group of people, whether it’s a country, its leadership, or any part of a society and culture. Speaking in that way can take away from constructive and thoughtful dialogue in society, which is needed now more than ever.”

The spokesperson added that Dimon strongly supports a constructive and detailed economic dialogue with China and is committed to the superpower. 

On Tuesday, the bank’s chief executive made a comment at a Boston College event in Hong Kong where he compared the longevity of his bank to the Chinese party. 

“The Communist Party is celebrating its 100th year. So is JPMorgan. And I’ll make you a bet we last longer,” he said.

JPMorgan has been operating in China since 1921. The Communist Party was founded in the same year. 

Dimon’s comment came after a one-day trip to Hong Kong where he was exempted from the restrictive three-week hotel quarantine requirement for travelers coming from the US. Dimon visited the bank’s over 4,000 employees. 

Dimon has made off-the-cuff comments in the past only to take them back. These include saying he was smarter than former President Donald Trump in 2018. 

In August, Dimon’s bank received Beijing’s approval to gain full control of its securities business in China — the first firm on Wall Street to do so. Dimon said the expansion would serve both the investment bank and other US companies.

 

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JPMorgan CEO Dimon joked that his bank will outlast China’s Communist Party

jamie dimon jpmorgan
JPMorgan Chase and Co’s Chief Executive Officer Jamie Dimon joked that his bank would last longer than China’s Communist Party while speaking in Boston Tuesday.

  • JPMorgan has been operating in China since 1921, the same year the Communist Party was founded there.
  • Earlier this year, JPMorgan won approval from regulators to fully own its China securities venture.
  • JPMorgan CEO Jamie Dimon reiterated his bank’s commitment to doing business in China.

While reiterating his bank’s commitment to doing business in China, Dimon said: “I made a joke the other day that the Communist Party is celebrating its 100th year — so is JPMorgan. I’d make a bet that we last longer.”

Dimon added: “I can’t say that in China. They are probably listening anyway.”

JPMorgan has been operating in China since 1921, the same year the Communist Party was founded there. Earlier this year, it won approval from Chinese regulators to fully own its China securities venture.

Speaking as part of a Boston College series of CEO interviews, Dimon offered his views on a broad range of topics.

Dimon expects inflation from supply chain issues will prove fleeting but that higher oil prices and wages will not go away, he said. He anticipates a percentage point or two of the recent 5% U.S. inflation pace will fade as prices for items such as used cars and lumber stop rising.

“There are other things which are probably not that transitory,” Dimon said. “I don’t think oil prices are going down.”

Dimon estimated there is about a one-third chance that inflation would be slight enough to bring on moderate increases in market interest rates that do not push the economy into recession. There’s an equal chance that inflation will go higher and push the Federal Reserve to withdraw support for the economy, perhaps causing a mild recession, he said.

Dimon also described the U.S. economy as “booming.”

“Consumers and businesses are in good financial shape and there is still more monetary and fiscal stimulus coming,” he said.

Asked about cryptocurrencies, Dimon repeated prior warnings to buyers. “It is not really a currency,” Dimon said, calling them “crypto tokens” with no intrinsic value that have run up in price on speculation fueled by government stimulus payments.

“It is hysteria,” he said.

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Elon Musk reportedly threatened to give JPMorgan a ‘one star review on Yelp’ if it doesn’t withdraw its lawsuit

Elon Musk
Elon Musk

  • An ongoing legal dispute between JPMorgan and Tesla led Elon Musk to fire back at the bank in a recent WSJ article.
  • “If JPM doesn’t withdraw their lawsuit, I will give them a one star review on Yelp,” Musk said.
  • JPMorgan says Tesla owes the bank $162 million from a warrant trade dating back to 2014.

An ongoing legal dispute between JPMorgan and Tesla has elicited a memorable response from Elon Musk, according to a report from The Wall Street Journal.

“If JPM doesn’t withdraw their lawsuit, I will give them a one star review on Yelp. This is my final warning!” Musk told The Wall Street Journal. On Twitter, Musk also said regarding the matter, “serious allegations deserve serious responses,” and “I will talk to their [JPMorgan’s] manager!”

The dispute revolves around Tesla warrants JPMorgan received in 2014 for helping the EV maker set up a trade. The warrants, which were incredibly profitable given Tesla’s recent ascent to a $1 trillion valuation, gave the bank the right to buy shares of Tesla at a pre-determined strike price.

According to the contract related to the warrants, JPMorgan had the right to change the strike price if Tesla announced it was exploring a sale, as that would impact the value of the warrants. JPMorgan went ahead and lowered the strike price of its warrants in 2018 after Musk tweeted “funding secured” at $420 per share, according to the lawsuit.

Once the deal announced by Musk didn’t materialize, JPMorgan raised its strike price higher, but not all the way back to the original strike price. When the warrants expired in June of this year, Tesla paid JPMorgan based on the original strike price rather than the adjusted strike price made by the bank.

Tesla would owe JPMorgan an additional $162 million if it paid the bank based on the adjusted strike price.

The strike price changes were “unreasonably swift” and “opportunistic,” Tesla said in the lawsuit, adding that it was the only bank to make such an adjustment. JPMorgan responded that other banks might have declined to adjust their warrant strike prices “for business reasons having nothing to do with the contractual terms.”

JPMorgan’s relationship with Tesla seems to have always been on edge. While the bank helped the company go public in 2010, it was ranked behind other banks like Goldman Sachs and Morgan Stanley. Tesla has paid JPMorgan about $15 million for advice and capital markets work over the past decade, well behind the $90 million it has paid to Goldman Sachs, according to Dealogic.

And JPMorgan’s consumer bank was initially hesitant to finance electric vehicles from Tesla due to concerns about the long-term value of electric vehicle batteries, The Wall Street Journal reported. How Tesla and JPMorgan can settle their ongoing dispute remains to be seen, though tweets from Musk may provide some insight. 

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How JPMorgan is battling to beat fintechs at their own game

JPMorgan Chase & Co. CEO Jamie Dimon speaks during the Business Roundtable CEO Innovation Summit in Washington, DC on December 6, 2018.
Jamie Dimon has been CEO of JPMorgan since 2005.

  • JPMorgan, headed up by CEO Jamie Dimon since 2005, is the biggest US bank by assets.
  • Dimon has said the bank will spend as necessary to compete with threats like buy now, pay later.
  • The bank has also been on a spree of buying and partnering with fintechs. 
  • Visit Business Insider’s homepage for more stories.

JPMorgan is the biggest US bank by assets and a bellwether for the global financial system — so when the firm’s senior leaders talk, Wall Street pays attention. 

On the bank’s third-quarter earnings call in October, analysts asked leaders how JPMorgan was responding to the threat posed by fintechs and buy now, pay later players like Affirm and Klarna. CEO Jamie Dimon said the firm would spend “whatever it takes” to beat the competition, adding that as companies expand beyond just BNPL into other offerings like debit cards, they become even more of a threat. 

“These are all different forms of competition which we have to respond to,” Dimon said. 

The bank has taken steps in this direction through several consumer-facing acquisitions so far in 2021. That buying spree included a deal for The Infatuation, a restaurant-review website that owns Zagat, which will be incorporated into the bank’s cards-rewards business. And JPMorgan has a $12 billion annual budget for internal tech development.

Read more about JPMorgan’s battle with fintechs:

Inside JPMorgan’s massive tech org 

Lori Beer JPMorgan Chase
Lori Beer, JPMorgan’s global chief information officer

JPMorgan has a $12 billion annual tech budget, employs 53,000 technologists, and houses 500 petabytes of data. Underpinning all of that is Lori Beer, JPMorgan’s global chief information officer, and her team of top tech brass.

Beer joined JPMorgan in 2014 as the CIO of corporate and investment banking. In 2017 she was named global CIO and joined the bank’s operating committee, reporting directly to Jamie Dimon, the CEO and chairman.

Insider mapped out the key tech executives at JPMorgan who report to Beer and help her lead the bank’s massive tech org. Many on her team are focused on specific business lines. There are chief information officers appointed to divisions like corporate and investment banking, asset and wealth management, and consumer and community banking. Some executives work across the bank, focusing on areas like employee experience and technology architecture.

Keep reading: 

A leadership reshuffle puts Allison Beer in the spotlight.

Allison Beer
Allison Beer is the the new CEO of Chase’s card business.

JPMorgan announced in September that Alison Beer would take over as CEO of cards for Chase, its consumer-banking division. She’s the third woman in a row to run the bank’s cards business, and she stepped into the role after Marianne Lake was promoted this spring to co-lead the firm’s massive consumer and community banking business alongside Jennifer Piepszak. 

Most recently, Beer was Chase’s chief product officer, and she’s held multiple roles since joining the firm in 2017: head of customer experience and digital; head of corporate development for banking and payments; and head of payments partnerships for Chase digital.

Her promotion comes after months of leadership reshuffling at the firm, which kicked off with the promotion of Lake and Piepszak this spring. The pair took over running CCB from Gordon Smith, who is retiring at the end of the year from his roles as co-president and co-chief operating officer of the firm and CEO of CCB, leaving Dan Pinto to be JPMorgan’s sole president and COO.

All had been rumored to be potential CEO successors to Dimon, who at 65 is Wall Street’s longest-serving CEO of a big bank. JPMorgan this summer granted Dimon a big stock award that pays off as the firm’s shares rise, and he has to stay around five more years to collect it. Dimon’s long-term stewardship, management-succession planning, and JPMorgan’s strong performance since 2005 were some of the factors considered in granting the award, the bank said in a filing. 

Read more: 

Other recent JPMorgan news:

Read the original article on Business Insider

JPMorgan is battling to beat fintechs at their own game

JPMorgan Chase & Co. CEO Jamie Dimon speaks during the Business Roundtable CEO Innovation Summit in Washington, DC on December 6, 2018.
Jamie Dimon has been CEO of JPMorgan since 2005.

  • JPMorgan, headed up by CEO Jamie Dimon since 2005, is the biggest US bank by assets.
  • Dimon has said the bank will spend as necessary to compete with threats like buy now, pay later.
  • The bank has also been on a spree of buying and partnering with fintechs.
  • Visit Business Insider’s homepage for more stories.

JPMorgan is the biggest US bank by assets and a bellwether for the global financial system – so when the firm’s senior leaders talk, Wall Street pays attention.

On the bank’s third-quarter earnings call in October, analysts asked leaders how JPMorgan was responding to the threat posed by fintechs and buy now, pay later players like Affirm and Klarna. CEO Jamie Dimon said the firm would spend “whatever it takes” to beat the competition, adding that as companies expand beyond just BNPL into other offerings like debit cards, they become even more of a threat.

“These are all different forms of competition which we have to respond to,” Dimon said.

It’s not the first time Dimon has sounded an alarm on the threat fintechs pose to traditional Wall Street banks. During JPMorgan’s year-end earnings call in January, Dimon said that the firm should be “scared shitless” about the growth in fintech.

“I expect there to be very tough, brutal competition in the next 10 years,” Dimon said in January. “I expect to win. So help me, God.”

The bank has taken steps in this direction through several consumer-facing acquisitions so far in 2021. That buying spree included a deal for The Infatuation, a restaurant-review website that owns Zagat, which will be incorporated into the bank’s cards-rewards business. And JPMorgan has a $12 billion annual budget for internal tech development.

Read more about JPMorgan’s battle with fintechs:

Inside JPMorgan’s masssive tech org

Lori Beer JPMorgan Chase
Lori Beer, JPMorgan’s global chief information officer

JPMorgan has a $12 billion annual tech budget, employs 53,000 technologists, and houses 500 petabytes of data. Underpinning all of that is Lori Beer, JPMorgan’s global chief information officer, and her team of top tech brass.

Beer joined JPMorgan in 2014 as the CIO of corporate and investment banking. In 2017 she was named global CIO and joined the bank’s operating committee, reporting directly to Jamie Dimon, the CEO and chairman.

Insider mapped out the key tech executives at JPMorgan who report to Beer and help her lead the bank’s massive tech org. Many on her team are focused on specific business lines. There are chief information officers appointed to divisions like corporate and investment banking, asset and wealth management, and consumer and community banking. Some executives work across the bank, focusing on areas like employee experience and technology architecture.

Keep reading:

A leadership reshuffle puts Allison Beer in the spotlight.

Allison Beer
Allison Beer is the the new CEO of Chase’s card business.

JPMorgan announced in September that Alison Beer would take over as CEO of cards for Chase, its consumer-banking division. She’s the third woman in a row to run the bank’s cards business, and she stepped into the role after Marianne Lake was promoted this spring to co-lead the firm’s massive consumer and community banking business alongside Jennifer Piepszak.

Most recently, Beer was Chase’s chief product officer, and she’s held multiple roles since joining the firm in 2017: head of customer experience and digital; head of corporate development for banking and payments; and head of payments partnerships for Chase digital.

Her promotion comes after months of leadership reshuffling at the firm, which kicked off with the promotion of Lake and Piepszak this spring. The pair took over running CCB from Gordon Smith, who is retiring at the end of the year from his roles as co-president and co-chief operating officer of the firm and CEO of CCB, leaving Dan Pinto to be JPMorgan’s sole president and COO.

All had been rumored to be potential CEO successors to Dimon, who at 65 is Wall Street’s longest-serving CEO of a big bank. JPMorgan this summer granted Dimon a big stock award that pays off as the firm’s shares rise, and he has to stay around five more years to collect it. Dimon’s long-term stewardship, management-succession planning, and JPMorgan’s strong performance since 2005 were some of the factors considered in granting the award, the bank said in a filing.

Read more:

Other recent JPMorgan news:

Read the original article on Business Insider

Jamie Dimon is just one finance leader not buying the bitcoin hype as it heads back to its record high. Here are 18 other skeptics.

jamie dimon jpmorgan
JPMorgan CEO, Jamie Dimon.

  • JPMorgan boss Jamie Dimon is well-known for his skepticism towards bitcoin.
  • That is despite heavy institutional adoption of cryptocurrencies, especially in bitcoin and ethereum.
  • Jerome Powell, Michael Burry and Jack Ma are among the financial leaders who might agree with him.

While more and more Wall Street firms and retail investors are embracing bitcoin and other cryptocurrencies, JPMorgan boss Jamie Dimon isn’t playing along with the crypto mania.

He recently slammed the digital asset as “worthless,” and questioned whether its supply can in fact be capped at 21 million. Previously, he’s said he wouldn’t care even if bitcoin’s price soars tenfold.

Bitcoin tested $60,000 in the week to October 15, nearing its record high of $64,863, and is up 104% so far this year.

Meanwhile, institutional adoption of digital assets has strengthened as long-term term investors continued to buy into bitcoin and ethereum.

Many influential tech billionaires – such as Elon Musk, Mark Cuban, and Mike Novogratz – have heaped praise on cryptocurrencies for their potential. In the financial world, the picture is different, and there are several leaders who can’t find a good word to say about digital assets.

Here are 18 big financial players who are also big bitcoin skeptics.

1. Jerome Powell

Jerome Powell
Fed Chairman Jerome Powell.

“They’re highly volatile — see bitcoin — and therefore not really useful as a store of value and are not backed by anything.”

“It’s more a speculative asset that’s essentially a substitute for gold rather than for the dollar.”

March 2021

Source: CNBC

2. Michael Burry

Dr. Michael Burry
‘Big Short’ investor Michael Burry

“$BTC is a speculative bubble that poses more risk than opportunity despite most of the proponents being correct in their arguments for why it is relevant at this point in history.”

March 2021

Source: Insider

3. Janet Yellen

Janet Yellen
Treasury Secretary Janet Yellen

“I don’t think that bitcoin is widely used as a transaction mechanism.”

“It’s an extremely inefficient way of conducting transactions, and the amount of energy that’s consumed in processing those transactions is staggering.”

February 2021

Source: Insider

4. Warren Buffett

Warren Buffett
Berkshire Hathaway CEO Warren Buffett

“Cryptocurrencies basically have no value and they don’t produce anything. They don’t reproduce, they can’t mail you a check, they can’t do anything.

“And what you hope is that somebody else comes along and pays you more money for them later on, but then that person’s got the problem.”

“In terms of value: zero.” 

February 2020

Source: Insider

5. Neel Kashkari

Minneapolis Fed President Neel Kashkari speaks during an interview at Reuters in New York, United States on February 17, 2016. REUTERS/Brendan McDermid/File Photo
Minneapolis Fed President Neel Kashkari.

“I was more optimistic about crypto or bitcoin about five or six years ago. So far, what I’ve seen is 99% … let me be charitable, 95% fraud, hype, noise and confusion.”

August 2021

Source: Insider

6. Bill Gates

Bill Gates on panel January 2021.JPG
Microsoft co-founder Bill Gates

“I do think people get bought into these manias, who may not have as much money to spare, so I’m not bullish on bitcoin, and my general thought would be that, if you have less money than Elon, you should probably watch out.”

February 2021

Source: Insider

7. Christine Lagarde

Christine Lagarde European Central Bank ECB
President of the European Central Bank Christine Lagarde

Bitcoin is a “highly speculative asset which has conducted some funny business and some interesting and totally reprehensible money laundering activity.”

January 2021

Source: Insider

8. Charlie Munger

charlie munger
Vice Chairman of Berkshire Hathaway, Charlie Munger.

“I don’t welcome a currency that’s so useful to kidnappers and extortionists, nor do I like just shoveling out a few extra billions and billions of dollars to somebody who just invented a new financial product out of thin air.”

May 2021

Source: Insider

9. Peter Thiel

Partner at Founders Fund Peter Thiel participates in a panel discussion at the New York Times 2015 DealBook Conference at the Whitney Museum of American Art on November 3, 2015 in New York City.
Billionaire tech investor Peter Thiel.

“Even though I’m a pro-crypto, pro-bitcoin maximalist person, I do wonder whether at this point bitcoin should also be thought of in part as a Chinese financial weapon against the US.”

“It threatens fiat money, but it especially threatens the US dollar and China wants to do things to weaken it.”

April 2021

Source: Insider

10. Ken Griffin

ken griffin citadel
Citadel Securities founder Ken Griffin.

“I wish all this passion and energy that went to crypto was directed towards making the United States stronger.”

“It’s a jihadist call that we don’t believe in the dollar. What a crazy concept this is, that we as a country embrace so many bright, young, talented people to come up with a replacement for our reserve currency.”

October 2021

Source: Insider

11. Gita Gopinath

Chief Economist and Director of Research Department at the IMF, Gita Gopinath, speaks during a news conference at the World Bank/IMF Spring Meetings, in Washington, Tuesday, April 9, 2019. (AP Photo/Jose Luis Magana)
IMF chief economist Gita Gopinath.

“Bitcoin is an example of a cryptocurrency that doesn’t serve the role of money at all. It’s a very speculative investment class.”

“In terms of substituting for what money is, I don’t think it comes close.”

April 2021

Source: Bloomberg

12. Nassim Nicholas Taleb

Nassim Taleb Getty Images 4
“Black Swan” author Nassim Taleb.

“The total failure of bitcoin in becoming a currency has been masked by the inflation of the currency value, generating (paper) profits for large enough a number of people to enter the discourse well ahead of its utility.”

June 2021

Source: Insider

13. Paul Krugman

paul krugman
Nobel-winning economist Paul Krugman.

“It’s not a convenient medium of exchange; it’s not a stable store of value; it’s definitely not a unit of account.”

“Its value rests on the perception that it’s a technologically sophisticated way to protect yourself from the inevitable collapse of fiat money, which is coming one of these days, or maybe one of these centuries.”

“Or, as I say, libertarian derp plus technobabble.”

May 2021

Source: Insider

14. Jeremy Grantham

jeremy grantham
Jeremy Grantham, chief investment strategist at Grantham, Mayo, & van Otterloo.

“Having no clear fundamental value and largely unregulated markets, coupled with a storyline conducive to delusions of grandeur, makes this more than anything we can find in the history books the very essence of a bubble.”

January 2018

Source: Bloomberg

15. Larry Fink

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BlackRock CEO Larry Fink.

“I’m probably more in the Jamie Dimon camp.” — in reference to Dimon calling bitcoin “worthless.”

October 2021

Source: Insider

16. Nouriel Roubini

Nouriel Roubini
Economist Nouriel Roubini

“Fundamentally, bitcoin is not a currency. It’s not a unit of account, it’s not a scalable means of payment, and it’s not a stable store of value.”

“Calling them cryptocurrencies is a misnomer, they’re not even assets.”

February 2021

Source: Insider

17. Jack Ma

Jack Ma
Alibaba co-founder Jack Ma

“Blockchain technology could change our world more than people imagine. Bitcoin, however, could be a bubble.”

June 2018

Source: Insider

18. Andrew Bailey

Andrew Bailey
Bank of England Governor Andrew Bailey.

“Given the volatility of the asset value, and given the fact that there isn’t a real asset underpinning them … I’m afraid if you want to buy them, then please understand that you can lose — you could lose all your money.”

June 2021

Source: Insider

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Morgan Stanley CEO says bitcoin isn’t a large part of the bank’s business, but admits crypto is more than just a ‘fad’

morgan stanlety big year james gorman 2x1
Morgan Stanley CEO James Gorman. Andrew Burton/Getty Images; Samantha Lee/Insider

  • Morgan Stanley CEO James Gorman said crypto isn’t in demand for the bank’s clients.
  • Even so, he admitted on the bank’s earnings call that cryptocurrencies aren’t just a fad.
  • He said he’s watching how regulators plan to handle the space.

Morgan Stanley CEO James Gorman says crypto isn’t a big part of the bank’s business but, he admits, it’s more than just a passing trend.

Gorman made the comments on the company’s third-quarter earnings call after an equity analyst asked how the bank planned to engage with clients regarding digital assets.

In response, the CEO said Morgan Stanley isn’t directly trading cryptocurrencies for retail clients – unlike some of its competitors – but it gives them access to buy digital assets through funds.

“It’s just not a huge part of the business demand from our clients, and that may evolve, and we’ll evolve with it,” he said.

Even so, he admitted: “I don’t think crypto is a fad.”

“I don’t think it’s going to go away. I don’t know what the value of bitcoin should or shouldn’t be, but these things aren’t going away. And the blockchain technology supporting is obviously very real and powerful,” he said after the company posted an earnings beat, thanks to a boom in investment banking and equity trading.

For the bank, cryptocurrencies are a working space, Gorman said, adding that, “We’re watchful of it, we’re respectful, and we’ll wait and see how the regulators handle it.”

Other prominent market players have also stayed away from cryptocurrencies amid regulatory uncertainty. JPMorgan CEO Jamie Dimon went so far as to call bitcoin “worthless” this week.

Regulators have been grappling with how to manage the space for months. The Fed recently said it has no plans to ban crypto, and the US Securities and Exchange Commission said it’s in the process of coming up with a regulatory framework for the market. Last week the SEC approved the closest thing to a US bitcoin ETF so far.

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Billionaire Mike Novogratz says Jamie Dimon’s stance on bitcoin is sophomoric

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Mike Novogratz.

  • Mike Novogratz scoffed at Jamie Dimon’s opinion that “bitcoin is worthless” on Monday.
  • “For a man who has done a brilliant job running a giant bank, his answers around $BTC are sophomoric,” Novogratz said.
  • Dimon questioned whether bitcoin’s supply can really be capped at 21 million.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Billionaire Mike Novogratz has dismissed Jamie Dimon’s opinion about bitcoin being “worthless.”

The JPMorgan boss has long been a bitcoin skeptic, and reiterated his distrust in the cryptocurrency on Monday, despite the bank becoming the first to give retail wealth clients access to crypto funds.

“So strange. For a man who has done a brilliant job running a giant bank, his answers around $BTC are sophomoric and he keeps doubling down on them,” Novogratz said in a tweet late Monday. “I pray I stay open-minded my whole life.”

Twitter CEO Jack Dorsey too reacted to Dimon’s skepticism, saying: “I personally think that Jaime Dimon is worth more to bitcoin.”

Dimon’s comments were made the day bitcoin surged to a five-month high above $57,000, taking its year-to-date gains to 96%. Part of his skepticism is around the cryptocurrency’s supply, which is capped at 21 million coins.

“How do you know it ends at 21 million [bitcoins]? You all read algorithms? You guys all believe that? I don’t know, I’ve always been a skeptic of stuff like that,” Dimon said, according to Yahoo Finance’s Brian Cheung.

Most advocates believe bitcoin’s finite supply serves as an inflation hedge, which has helped drive up its value. This argument has been bolstered since bitcoin’s creation in 2008, as central banks have expanded the supply of fiat money in order to stick to their respective inflation targets, according to Standard Chartered.

Last month, Dimon said he isn’t a bitcoin investor, as he doesn’t care for it, and borrowing money to buy it is foolish. He said he wouldn’t care even if its price increases ten times.

In 2017, he called bitcoin a fraud that’s worse than tulip bubbles and said he would fire any JPMorgan trader who transacted in it.

Read More: A ‘bitcoin maximalist’ old school value investor breaks down why he thinks the cryptocurrency will hit $100,000 this year – and reveals the 2 altcoins he holds as speculative plays

Read the original article on Business Insider

Bitcoin has no value and authorities will soon ‘regulate the hell out of it,’ says JPMorgan CEO Jamie Dimon

jamie dimon jpmorgan
  • JPMorgan CEO Jamie Dimon doubled down on past skepticism of bitcoin in a TV interview with Axios.
  • Dimon is a longtime crypto critic who has trashed bitcoin as a “fraud” and a waste of time.
  • His critical remarks come in contrast to growing crypto interest by mainstream financial institutions – including JPMorgan.
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JPMorgan CEO Jamie Dimon doubled down on past skepticism of bitcoin in a TV interview with Axios published on Monday, warning investors that the cryptocurrency has no underlying value.

“It’s got no intrinsic value,” said Dimon in response to a question on whether bitcoin was akin to fool’s gold.

Asked about whether authorities should regulate crypto, Dimon said, “Regulators are going to regulate the hell out of it,” adding that this was more a factual than a moral statement.

“If people are using it for tax avoidance and sex trafficking and ransomware, it’s going to be regulated, whether you like it or not,” he told Axios.

Dimon was also pressed on his $31 million compensation package, which in July was boosted with around $49 million in JPMorgan share options, according to the Financial Times.

“The board decides what I make,” he said. “We have a free market in this country, which … everyone should applaud.”

Dimon is a longtime crypto critic who has trashed bitcoin as a “fraud” and a waste of time. In September, the JPMorgan boss said he wouldn’t care if bitcoin’s price shot up even further.

“That does not mean it can’t go 10 times in price in the next five years,” Dimon told the Times of India. “I remember when beanie babies were selling for $2,000 a pop. We all know about tulip bulbs.”

Dimon’s critical remarks come in contrast to growing crypto interest by mainstream financial institutions – including his own JPMorgan. In July, Insider reported that would be the first big bank to execute crypto trades requested by its wealth-management clients.

Read the original article on Business Insider