numbers, but vacancies are super low at 2.8%. so i'm a buyer on the okay. >> and joe t. >> the low hanging fruit continues to be the insurance companies we all know. the reason why is we pay those premiums. progressive corp one name you can. >> own 2.5% up. all right. decent move here in the market. we'll see what the last hour brings. i'll see you then. the exchanges now. >> thank you very much, scott. and welcome. >> to. >> the exchange. >> i'm kelly evans and a really busy hour ahead. stocks are trying to rebound amid soft patch concerns for the economy. not helping sentiment is berkshire hathaway's record cash hoard. its buffett bearish. or is the company just too big. we'll talk to a longtime shareholder about that and why he likes this mystery stock that berkshire has been buying. another place buffett is bullish on we could say is abroad. he's doubling down on japan, while china and europe are all outperforming the u.s. so far this year. our guests say it will continue. and they tell us the best things to buy. and the big interview today is jp morgan

chase ceo jamie dimon. what does he think is happening with the economy and will he talk more about return to the office? you don't want to miss it. later this hour. but first to tom chiou for more on the markets. >> a little bit of a bounce back today, but we're going to need a lot more to get back to losses that we saw just on friday. so right now we are positive for the dow industrials at 43,006 23. it's up roughly 195 points. that's good for a one half percent gain. the s&p 500 currently sits at 6020. it's up about eight points. about one tenth of 1% gain. there's a particular attention being paid to the level of 6009. that's the 50 day average price on a rolling basis. we've kind of bounced above that level right now, so we'll see if that support holds here. for the broader s&p 500 and the nasdaq composite. the tech heavier trade is actually the laggard on the day, down about one quarter of 1% to 19,004 71 for the composite index. that's good for about a 53 point decline there. another place to watch is what's happening right now,

specifically with the key part of the market in the small caps. it's been an underperformer for months now, even since the election. but we reached a point today where at one point, at the lows, we were roughly just about 11% below the recent highs that we saw over the past year, putting it in that so-called correction territory down 10% or more. the other thing to keep a close eye on right now is it fell below this yellow line that you're seeing here, which is the 200 day moving average or longer term trend line. so keep an eye on whether or not we can hold some of these levels. for the small cap index. we'll keep an eye on that. and then the stock of the week the day the month the everything. so far, maybe even this earnings season has to be nvidia shares. they're pretty calm right now. flat on the session $134.45. and remember earnings come out after the bell on wednesday. and right now the options market is implying a roughly seven and one half percent move up or down on the heels of that. and by the way, that's less volatile than it's been over the course of the past couple of years. and then the ten year note yield continuing

to move higher in price and lower in yield. we're now at 4.4%. you can see kind of like this medium term trend line moving lower. interesting that we still have a bit of an inflationary threat that might be emerging in the coming weeks and months. and yet at the same time, a more pronounced market selloff driving that drive to safety. so those government bond prices, that safety trade so to speak, kelly getting some steam here, 4.4% is your ten year yield. i'll send things back over to you. >> look at that dom. thank you. dom chu and stocks sold off last week on signs of a shaky consumer still skittish about inflation. we'll get the key pce index later this week along with more data on confidence, home sales and spending. is this a real soft patch or just a valuation reset in the market? here to discuss are bianco research president jim bianco and cnbc senior economics reporter steve liesman. jim, i'll turn the mic to you first. as the practitioner, you know what's under what conclusions are you investing in right now? do you think this is a soft

patch? >> oh. >> it's hard. >> to say whether or not it's. >> a soft patch. >> or if it's indeed that expectations. >> for a strong economy rose so much that it's been. >> easier to disappoint. >> and i. >> tend to. >> think it's a little. >> bit more of the latter. of course, the economy goes up, the economy goes down. and right now i don't see it meaningfully declining. >> so steve liesman kind of first turn to you to back that up. we've seen some of the retail data a little bit weaker. obviously we've had anecdotal, anecdotal reports like walmart's reduced guidance. what how would you kind of summarize things. >> well, first of all, just. >> to note. >> people, this is a pretty big week. we have some retail earnings coming out this week that we'll be watching carefully to see if there's a follow up on walmart. there was. >> some colder weather in january. kelly as you know, that might have hurt retail. but you know, it's one of those things where it's like you don't you don't ignore it and you don't panic on it. you watch it and you say, okay, this is something

worth watching. the interesting thing, of course, last week that everybody was talking about was the university of michigan sentiment numbers, which showed a decline. i don't think the sentiment has much to do with sales at the end of the day, at least certainly on a month to month basis. but watching those inflation indicators was interesting to me. they ticked up and michigan said, hey, people are mentioning the tariffs. so it's really interesting to me that the tariffs are so pervasive out there in the economy, among the general public. we see them having an effect on businesses right now. so whatever president trump is trying to do for the positive for the u.s. economy, i think he has to be conscious of the process and how it's having an effect. i've just been dragged out. you remember we were in two weeks ago on a sunday when the tariffs were threatened and then they didn't come. so now we're facing additional deadlines in march and april. so the process looks to be having an effect on the on the economy here. >> jim let's talk about the ten year for a minute. because if we

were you know looking we're below 4.50. we're almost below 440 right now. it'd be a great development if it wasn't accompanied by some of these soft patch concerns. so if you can put them at bay and tell me that long term yields are falling because we're fixing the debt problem or something, i'd feel much better about that. >> yeah, i'd like to be able to tell you that that's the case. >> but unfortunately. >> if you look at. >> the ten year yield, you know, basically since the election, november 15th, it was at 448. today it's at 441. you know, so it's been broadly been turning sideways, although technically it has declined for six weeks in a row. and i don't suspect that we're going to see much more in the way of downside on the ten year. now it could continue to go sideways for a little while longer. but i think if we were to see an uptick in the economy, some kind of stimulus package from the trump administration in the form of extension of tax cuts, deregulation and the like, that you could see those yields moving up and i wouldn't be afraid of that. and i don't think we should. i mean, the

idea that, oh, god, the ten year is going towards 5% and that's somehow bad is predicated on the idea that we've got a weak economy that can't handle it. but if we have a stronger economy, that should not be a problem for the stock market and the economy. it should be a sign of its strength. >> right? of course, we just have to consider if it's, you know, how much is priced in because of the bigger deficit, the bigger debts. on that note, let's bring in rick santelli. the two year notes just went up for auction. this gives us a view at the shorter end of things. rick. how'd it go. >> it won. >> terrific. >> it was as. >> if no. >> debt existed. >> as if deficits disappeared. they just lined up as if they were trying to stand in line for some french pastries. the yield at this auction 4.169, which was well over a basis point. below the one issue market. lower yield, higher price. government's the seller. it was a solid a auction. and if you look at the metrics, all the metrics were good. the one that really jumps out at me is the

dealers take 6.9%. the ten auction average is double that. that's the best since january of 2018. and it really does underscore what jim bianco and our guests, our guests is talking about today. you know, the short end really hasn't moved a whole lot, but there's definitely a bias on the uncertainty part of the equation that seems to be pointing towards potential weakness. just look at how the market acted on friday. but on the other hand, you mentioned university of michigan and the weaker reads. the inflation reads don't seem to be affecting the long end enough. i agree with jim. i think that the long end, the amount of time we're going to do under 4.5% is probably numbered. and just as a generic and i've said this before, the curve is flattened from the low 40s. that's not a good sign. we want to see it steepening. we could debate as to all the reasons what would make the curve steepen, but in a very generic macro fashion, if you're hoping for a better economy, all things considered, then you want a steeper yield curve tomorrow. of

course we do five, followed by seven on this $183 billion treasury package. back to you, rick. >> thanks. and steve definitely feels that way to us watching these wiggles that, you know the ten year goes up when the data is better. it goes down when the data is worse. the city surprise index is bad today. you know, all of these kind of data points is kind of what's what's gotten us to this point. >> i think it's back to where we thought the world or the bond world used to be. we had an anomalous period here, and we may not be out of it. i'm interested in jim's thought on this, where it looked like the bond market was trading on supply. that's usually not been the case. the market has sort of digested supply. i have always been amazed when rick comes on and says, we've sold some enormous amount of treasuries, and he gives it a c, and i give it an a because i feel like, well, we sold it. thank god for that, you know. but in any event, we've been selling the treasuries. it looks like now the market it's interesting to me is trading more on economic

outcomes and perhaps not quite as sensitive to supply as we had thought. >> i agree, which is a helpful development to be sure. maybe it's because treasury secretary ruled out jim the idea of issuing more long term debt right now. so he's going to wait for at least for the fed's kind of selling of bonds to end before he does that. so give us the quick last word here to set up the week. how important is pce on friday. you know all of it. >> yeah. no i think it's important. and i think what we have to see is whether or not this soft patch in the economy is because expectations for growth have risen so much that we're just we raised the bar and it's harder to jump over or if it's actually a real soft patch. now, i just think it's the raising the bar. and that's why i think that interest rates are going to kind of stay at these levels, if not drift a little bit higher. and again, i'll emphasize it's not going to be a big problem. and yet you're right. pce is going to be a big thing. but usually after cpi and ppi we have a pretty good gauge on how that's going to come in at around 0.3 on the core number. and it shouldn't usually

surprise. >> yeah, i always think it comes out on a friday morning. they kind of bury the news without meaning to. we always kind of get it and then go into the weekend and say, oh, we'll worry about this next week. gentlemen. thanks, jim bianco and steve liesman this afternoon. meantime, warren buffett's annual letter to berkshire hathaway shareholders was out over the weekend. always makes for great reading. the big headline is the firm sitting on a record cash pile of over $334 billion. but buffett assured investors his love for buying stocks hasn't changed. and it won't change, he wrote, in a reference to the fact that there's high stock market valuations right now. quote, often nothing looks compelling. very infrequently, we find ourselves knee deep in opportunities. joining me to discuss is longtime berkshire shareholder bill stone. he's cio of the glenview trust company. bill, do you take it as a bearish sign or. i mean, look, warren buffett talks about it could take us a year to build a position in companies. sometimes there's just not they can't be that nimble. >> yeah. i don't. >> know. >> if it's. >> necessarily bearish. >> i think it is. >> to your point. >> when you read off that quote.

it's you know, clearly not enough looks compelling to him at this very moment. you know, i think he went to pains to say, hey, we still have a, you know, billions upon billions invested in both publicly traded stocks and operating companies. so it isn't you know, he i think in his own way said, you know, it's not that i'm negative on things. and in fact i prefer to essentially over time you know, not have cash and invest. it's just looking for things. i'd also say, you know, when he says nothing compelling, you also have to remember, buffett only really thinks in terms of his circle of competence. he didn't talk about this in the letter, but he's talked about it many times in the past. so there's just a lot of things he just automatically says no to because he says, i don't. it's not in my circle of confidence. i don't invest in those things. so that is also part of the of the math you have to think about. >> and i. >> was chuckling too when he, you know, he said obviously we also own outright a ton of companies. and he said, you know, i regret more than a few of them, but overall they're doing pretty good. their operating income was up

strongly. he talked a lot about the changes that have been made under geico and so forth, and i thought his comment about dividends was interesting. you know, he made the point in passing that berkshire's payment for corporate taxes represented 5% of all corporate taxes that were paid last year. and he said, we could do that because we don't pay dividends. and he really sort of talked about the value of that model. and i don't know if that would ever apply more broadly because there's such a unique holding company. >> i think it's tough for many companies or much of any company other than berkshire, to get this much room from shareholders to say, yes, you can hold on to my, you know, $334 billion and not give it back to me or you know because i trust you to find something to invest it in that i think is going to be good. you're right. not many people or companies would get that trust. that's just the fact of the matter. >> yeah. so we mentioned a mystery chart. and let's find my buddy over here who guessed i think it was brian. the mystery chart is constellation brands, which was a kind of a strange name when you always see berkshire buying it, but not that strange. i mean, this is a

stock with a lot of guts, a lot of bad news, a lot. you could rattle off eight problems with it, a lot of warts, i guess you'd call it. and that's usually the kind of names that they're looking to. why do you think this is such a good pick right now? >> well, it's interesting because i think, again, you think about the model. it's not clear what's buffett buying it. but obviously even ted and todd who work with him, you know, clearly think fairly similarly. so one is you know, he's looking for, you know, maybe a brand name that has run onto tougher times that he can buy at a cheaper price. so think of constellation. really, what you have to think of there is they own corona and modelo here in the united states. run into some tough numbers here lately. in terms of the outlook there. and really beer in general has been struggling, although those two brands have significantly outperformed beer in general. so if they get back on their kind of longer term trend, the stock is really cheap. valuations are down at levels. frankly, we haven't seen since the company

acquired modelo and corona other than, you know, few a few measures maybe during covid, but honestly it's about as cheap as it gets 13 times earnings you know, 2.3% dividend yield i think the other part buffett loves companies that produce a lot of free cash flow. this company produces a lot of free cash flow. so it does fit the mold. >> all right bill, we'll leave it there for today. we appreciate your time. bill stone from glenview trust brian rosen and tom brune, both guest constellations. so congrats to them. coming up, the chinese internet stocks are getting hit after a pretty strong rally to start the year. despite today's 10% drop, alibaba is still up 53% since jan one. we'll look at what's behind today's pullback and what some of the changes in china policy could mean for investors. plus, an exclusive interview with jp morgan chase ceo jamie dimon. we'll talk fed policy, the new administration and their approach to regulation. we'll ask about of course, his evolving views on remote work. the exchange is back after this. back after this. >> this is the exchange on

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emmanuel macron at the white house today. again, macron is the first european leader to visit the white house since trump threatened the eu with tariffs pivoted on ukraine, really, since he took office. it also comes as global markets are reacting to the election outcome in germany this weekend. britain's prime minister will be next at the white house on

thursday. michael o'hanlon is director of research for foreign policy at the brookings institution. michael, we're just getting the headlines out from this discussion between the two of them, at least what they said publicly, trump said nato is a good thing if done properly. he said he could end the war in ukraine within weeks. macron says we are ready to provide security guarantees to ukraine. so what's the significance of this gathering? what are you listening for? >> i am. >> listening for constructive language. >> like that. those are pretty good comments, in contrast to what we've heard most of the last week from the trump administration, with the war of words between mr. trump and president zelensky of ukraine, president trump, at least temporary misinformation about who started the war, and a few other things, including a vote at the united nations that failed to condemn the russian invasion. >> so that was all. >> concerning talking about nato as important, talking about having an idea for how to end the war, whether. >> he. >> delivers or not is. >> an open. >> question, but.

>> i like that. >> kind of framing, and it suggests a constructive approach. i think president macron of france, of course, he's dealt with trump before president to president in trump's first term. and he's also been a proponent, as many french have been historically, of europe being a stronger pillar in the overall north atlantic treaty organization. and, you know, the alliance. aas are willing to put forces on the ground in ukraine as sort of a. >> guarantor or a backstop. >> to a peace deal with the united states only having to, let's say, promise to come help in the event of a crisis that could satisfy, in theory, president trump's demand that europe. >> do more. >> and perhaps even wind up being terms that putin himself could accept. so we're a long. >> ways from a finish line. >> and president trump. >> if he takes a. >> few months. >> to help end this war, that would still be an accomplishment. so i'm not suggesting he needs to be held to his timeline, and it's not his decision to make all by himself either, by the way. but what i've heard today is good. >> you know, not that you're a stock market analyst, michael,

but it is striking how well the european market has done. and if it were the opposite, if those stocks were selling off, and if every time there was a bad headline, i mean, that would tell you that investors were existentially worried about what was going on there, even to the worried about a breakup of the eu and so forth. this seems to be quite the opposite. >> yeah, i hope so too. you know, again, things change by the hour with this presidency. and that's part of who mr. trump is. it's not like, you know, if one of us were to ask him, would you just be consistent in your messaging so the stock market can figure out which direction to move? he would say, no, he's not interested in stability. he's interested in disruption. and he considers that part of his toolkit. and i'm sure it's just part of his personality. so i'm not going to i'm not going to go out and buy a lot of stock based on the idea that now we're close to a resolution of this conflict, but at least the idea of complete american abandonment seems a little further than it was trending last week. >> yes. so where do you think that leaves politics? obviously, i heard the wall street journal's berlin bureau chief say that the outcome in germany just tells him that the country

has lurched to the right. he said, much like the rest of europe. what does that imply? >> yeah, i mean, i, you know, talk to my german and german specialist friends at brookings and elsewhere all the time about this, the fact that the alternative for deutschland could win 20% of the german vote, when it's a party that basically is anti-islam, largely anti-foreigner, and even unwilling to criticize the nazi past in germany, sometimes that's got to be very concerning. and i don't like it. and it does make you wonder where it's headed. on the other hand, it won 20% of the vote. it didn't win 40%. it didn't win 50%. it's not going to be the lead player in any future government. it probably won't even be in the next government, although that remains to be seen because germany, as you know, has this parliamentary system. but then a chancellor on top, sort of like a prime minister in a sense, but a little different. anyhow, traditional parties did not do great, but one of them got 29% of the vote, the christian democrats. and that

will probably be the party that has the first chance to form a new government, and will probably try to keep the alternative for deutschland out. and beyond that, i don't know where it's headed over five, ten, 15, 20 years. if this new, you know, anti-immigrant party is going to keep doing better or not. >> right? of course. and it's such a striking change in a relatively short period of time from from merkel, even though she was the same party as mertes. anyway, michael, again, the market for now is giving them some breathing room and we'll get more headlines from trump's meeting with macron today. thanks for joining us. michael o'hanlon with brookings. thank you. let's turn now to china, where the hang seng has been up 16% this year, also outperforming the s&p. the kraneshares china internet etf is up 18%. baba is web's biggest, holding up nearly 65% year to date. but us listed chinese internet stocks are under some pressure today in part. alibaba announcing it's going to spend $52 billion in the next three years on ai. and president trump over the weekend vowing to restrict china's investment in u.s. tech even

further. but my next guest says there's so much of it. there was. it's basically dried up, though, so that these new new measures will lack bite. joining me now is brendan ahern, the chief investment officer of krane shares. all right, so, brendan, i keep thinking of david tepper's china play from last year, which at first was off to a little bit of a rocky start and now really has picked up steam. >> yeah, 100% kelly. >> you know. >> we're getting a. >> bit. >> of a. >> pullback here today driven by some of the cfius news from president. trump last friday. but in general we were. >> a bit overbought. you know we've had a heck. >> of. a run. >> actually going back to january. >> 22nd. >> of last year. caleb is actually up over 50%, which. is twice the return of both the s&p 500 and the nasdaq 100. >> so what kind of explains that? i mean, in the bigger picture sense, right. everyone could hope and bet on. and this goes back to tepper's comments. they say they're going to stimulate. i take them at their word and that's what they're doing. we've seen president xi being more friendly towards the tech leaders. that's a huge

change. kind of indicates an openness towards, you know, more success there on the investment front. what else? >> yeah, we've had a number. >> of comments from both. >> the ministry of finance. >> about just. >> supporting domestic consumption. >> we also had. >> premier li hosting a meeting. >> with the state council, where they spoke. >> at length. >> about domestic consumption. >> so i think, you know, next week we're going into really the beginning meetings leading up to the big dual sessions. this is the real kind of legislative meetings in china where they set the budget set, really the agenda for the next year. so i think this emphasis on the private sector as well as domestic consumption shows that coming out of that meeting, hopefully we get some some further stronger stimulus as well as we really do believe that china needs to do a deal with president trump in order to address the real estate crisis, the ongoing real estate crisis in china. so we think, you know, that that's a very key function for the chinese government is to get down to brass tacks with president trump and do a deal.

>> wait a minute, wait a minute, wait a minute. now, president trump is a real estate specialist. we could say. but what could he or the u.s. offer to fix china's real estate crisis? >> oh, i'm saying that that china, the chinese government, needs to do a deal with president trump to allocate the resources to address the real estate crisis in, in in china. they're not counting on president trump to deal with that domestic issue. but i think for the chinese government, because president trump is so unpredictable, they've had to keep a lot of dry powder on the sidelines. they want to allocate that. they want to address the real estate situation. but i think in order to do so, they got to do a deal, another deal with president trump. >> so we have 10% tariffs on china, effective as of a couple of weeks ago. what's the impact of those been? >> i mean it's pretty de minimis. i mean thus far the markets both in the us as well as in china have really, really just kind of ignored them. i think this could be a little bit of the art of the deal, as we saw with friday's announcement. we know president trump is going

to get a great deal on behalf of the american people. we know china is going to have to give up some things in order to satisfy that. we really think agriculture, as we're seeing with corn and soybean futures rallying since president trump, boeing airplanes. but we also think potentially the chinese companies are allowed to build factories here in the us, something that a number of them have mentioned they would like to do, but we're actually told no by the previous administration. >> well, if they were told yes now, that would be a very big deal, brendan. we'll leave it there for the moment. we appreciate it today. brendan ahern with crane shares. coming up, we'll talk more about big tech's ai race heating up. wall street squarely focused on the spending numbers. as we said they're hitting alibaba today. silicon valley, though is getting a very different reaction. we'll explain next. we're moments away from our exclusive interview with jp morgan ceo and chairman jamie dimon. looking forward to that. and we're back after this. >> what makes. >> a comfortable retirement? it's having. >> the money to. >> retire on your terms.

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you. >> thank you. kelly. >> it's actually raining. >> here. >> but lots of rainmakers. i'm sitting with one of them. jamie dimon, thank you so much for joining us from your global leveraged finance conference. let's get right into the macro environment because the market really seems fixated on some of these growth concerns regarding weak retail sales, soft consumer sentiment, policy uncertainty and the like. does this skittishness match what you're seeing within the bank, as well as what you hear from clients at this conference and beyond? >> yeah. >> basically it does. >> you know, you've had. >> a slowing down. >> you know, we've had this huge. >> boom after covid and all the money that was given out and spent. and so we see consumers are kind. >> of back. >> to normal. so they don't have all the extra money but they have jobs. >> wages are going up. >> but you know. >> if they. >> they substitute a more a cheaper product for a more expensive one, they cancel a trip. so you're starting to see a normal credit costs have normalized. so it's just almost back to what i call a normal environment. you know, it gets

better or worse from here, i don't know. >> but kind of normal normalization. >> a key wildcard that people are trying to grapple with has been just this flurry of executive orders coming in from washington. and whether they're going to be net positive for growth. point72 steve cohen saying on friday that tariffs, tighter immigration laws and government cost cutting efforts led by doge could weigh on the economy. do you agree with that? >> yeah. >> look, i'm. yeah. could they? yes. of course. but i think, you know, the economy is like this huge ship of state, and these things are at the margin may not change that ship of state. and also it really depends the quality of what you're done. you know, more effective government, more efficient isn't bad. it's actually a good thing if they get overdone tariffs properly used. you know they're overused. you know if there's retaliation yeah they could be bad for the economy. but you know they're just making up for use for negotiations making up for unfair trade. so i'm more in the wait and see attitude about how this all plays out. >> how do you think about the

self-described chainsaw approach that doge is taking to the federal government? is it something you support? >> yeah, you know, it's too binary to say support or not. here's what i support. okay. the government and most of all, everybody would know the government is inefficient, not very competent, and it needs a lot of work. and so you and i, it's not just waste and fraud, it's outcomes. why are we spending the money in these things? are we getting what we deserve? you know, what should we change? so i think doing that needs to be done. remember we tried by al gore and bill clinton. it was tried by a bunch of other folks in the past. yes, they should try. i also, you have to understand that whenever you go into any big institution or government, the bureaucracy pushes back on everything. and they will hear every little thing they're going to push back on. so you have to be strong if you're going to do it. i'm hoping it's quite successful. you know, if there's overreach, things that are doing which are not legal, the courts have stopped it. but, you know, i'm hoping that's not the case. but again, it's very early stages to

tell exactly what it's going to mean and how it's going to affect the economy. >> is success defined by bringing down the deficit? >> i think ending fraud and waste and abuse, if it brings down the deficit, yes, but also making systems more. i mean, if you just identify that we can build better systems and across these departments that are being more effectuate the jobs as opposed to, do, you know, modern technology like the faa, you heard about the faa actually should be doing that. now. some of them may actually put money in the long run in the short run, but it'll save a lot of money in the long run. and it saves lives. so we have to learn to do the thing right. it's not just about the deficit. it's about building the right policies, procedures and the government we deserve. >> how about tariffs? and i want to get your latest thoughts. because at davos you told andrew ross sorkin that when it comes to tariffs, if it causes a little more inflation for the sake of national security so be it. and there was recent research from jp morgan's economics team that said the tariff threats appear to be rattling business confidence, just the uncertainty of it all.

how do you assess all of the various tariff headlines and what they mean for. >> so be it. i got a lot of criticism by saying is if it's used to protect national security, that is paramount and that transcends if it causes a little inflation. national security has to be paramount. and think of rare earths. you know, think of medical supplies and things like that, where it may be one of the tools that could national security. i don't know yet. you know, he we've had this before. you know, he's done some he hasn't done a lot. they're talking about it. there are a lot of people have opinions. and even inside the administration, you hear some talk and it's like, do a lot. and you see him talk. we're going to use it as a tool. so again, i'm more in the wait and see attitude about how it is. it will affect confidence. yeah it will affect the confidence in certain businesses. but you know if i if i pulled 100 businesses out here today, 80 would tell you it's not going to affect my business at all. some may tell you it's going to be good for my business, and there will be a

bunch of fewer rattled. it could really hurt their business. >> and in terms of inflation, broadly speaking, you know we've talked about tariffs. there's also the immigration element to it all. are you worried about inflation at this stage. do you think that the fed is fully stamped it out. >> no i was worried about inflation before those issues because when i look at the world, you know, we've spent our deficit at 7%. our debt to gdp is 100%. those numbers are more than double what they were when we had a lot of inflation in the 70s and 80s. it's hard to say what was driving. i even asked, i what drove the inflation in the 70s and 80s. there's no real answer to it, but something drives. but spending money drives inflation. deficits are global. that's true around the world and their high debt levels around the world. so both of those are kind of a risk. but i'm also looking at future things. so there are things in the future which i can tell you are probably going to happen. and most of them are inflationary. the remilitarization of the world, the green economy, which, you know, we've wasted a lot of money on, probably waste more.

the infrastructure the world needs. the restructuring of trade. those things are inflationary. and as deficit spending. so i don't see deflationary forces. and even if you say i, i don't think they're going to be deflationary in the short run. it may very well be deflationary. you know, after 3 or 4 years. but most of us for now, we're spending more money on it, not less. >> i want to ask you about ai in particular, because this is the first time we're sitting down with you since the whole deep sea phenomenon came out. this idea that ai models can be trained cheaper, more efficiently, perhaps, than some of the well known us counterparts. i'm curious how you assess this space. are you concerned at all about roi? are you concerned about overspending here in the us? are you concerned at all about american competitiveness? >> no. >> so america is very competitive. not concerned about american competitiveness. you know, the chinese may be ahead on certain things. i to take a deep breath on this one too. it's going to sort out. all technologies have cheaper, faster, slower. you know some

they get deployed. took 20 years to deploy the internet. how long did it take to deploy electricity? how long did it take? and there'll be fits and starts. there'll be open miles. there'll be closed miles will be cheap miles. you know, this type of mile. and my view is, if you use them all to do a better job for your company, your clients. and we'll. i won't be an expert at it. however it develops. well, too much money be spent. probably. there's almost no new technology. maybe didn't get overbuilt at one point. that may not be in the next year or two, but that may very well happen. >> and i want to follow up on what you said about wasting money on the green economy. where was that money wasted? and do you think that there should be a different approach as it pertains. >> to i think we've i think we've been using a whack a mole approach with, you know, with gifts and telling people to do things. we need safe, secure, affordable energy. it has things like lng have the benefit of not just being safe, secure, but we can give it to our allies and it reduces their co2 because it

replaces their use of coal. so we make a lot of decisions, sound like they're good, but they create more more co2. and i put some some ev policies in that. i put some place based policies. i think some of the stuff we did around the infrastructure act, you know, added a lot of additional costs, which will not help co2. so i think we've got to take a look at all of that and say, what? what are we really dealing with? the system is far more complex than people are dealing with. and we plays whack a mole approach. and then we think, you know, yelling at companies is going to do it. a lot of these big companies, like oil companies, have done a great job getting down their co2. and a lot of them are the ones. and some of these other videos, we're going to come up with the new ways of fixing it with biomass or carbon capture or, you know, how they do methane capture, etc. so the system will evolve, but you need all forces to work on it, r&d, government, and you should be very careful about restrictions like we can't get pipelines built that will

reduce energy costs and co2 in new york and massachusetts. and that's what i'm saying. that's the that's like the road to hell is built with good intentions. we need to finish the pipelines that get gas to places that use too much coal. and you're going to have a small consumer revolt when they have to pay three times more, you know, in one state than another state, because they can't get hydroelectric power. you may not be aware we couldn't get hydroelectric power from canada into massachusetts because the states of vermont and maine wouldn't allow it. so massachusetts has i think energy costs are 2 or 3 times higher and a lot dirtier. that's the kind of thing i'm talking about. >> fascinating. in terms of geopolitics, broadly speaking, you have been warning about the geopolitical environment for quite some time. you spent time with the ukraine, president zelensky, you're very focused on the conflict there. what do you make of the latest the latest posture in american foreign policy that seems to be shunning ukraine in favor of russia? >> yeah, i'm not sure i hear

that. i'm not sure that's true. and i know when people speak, you can read an article from this person that says is shunning this one, saying, no, no, it's just the beginning gambit of the thing. i believe that we should have a safe, secure ukraine and the secure part has to be stable and secure for the rest of life. you know, it can't be. and it's going to take a lot of complex negotiation to get all the players at the table. it will. i think it has to ultimately involve europe, ukraine, the united states, russia, maybe china. and, you know, i'm i'm hoping they succeed at it. i don't think that when, you know, people make one statement that that's, you know, that's the only thing that's meant. i think there are other parts to it. and you listen to people like, you know, mike walsh or steve witkoff, they, they, they talk about the security of ukraine. they talk about getting it right. they talk about ukraine being involved. and so i hear that too. >> so you think that president trump calling zelensky a dictator and saying that, you

know, ukraine invaded first all that's a sideshow, essentially, or a negotiating ploy? >> i'll let you guys decide that. >> okay. i want to ask you about bank regulation, because the industry and you in particular have largely cheered, you know, what we've seen in terms of a deregulatory posture? do you think that the government is going far enough from your perspective? and are you worried, as some critics have said, that there is a potential for the pendulum to swing too far, that it would prevent a crisis, or it would prevent some of the supervision that is necessary for a sound. >> to our banks. we have become a highly bureaucratic, litigious, overregulated society. and it's bad. if you don't believe me, go to europe. i'm not saying we shouldn't have regulations. we should protect the financial system. we should protect the food system, the water system. but the american public should know this is bureaucracy completely run amok. so if you look at and you know, in the bank side now they talk

about, you know, the banks off the hook. if you look at regulations last, since they've been going up nonstop, there was no never backsliding. and if you look at between sikar, gcp, slr, lcr, resolution recovery, ccr, they become. terrible. they don't work. they're excessive, you know. so my view is it's time to step back and look at what do you want and how can you make the system safer. not you know, these things aren't making the system safe. you look at silicon valley bank. i would never let a bank take that much interest rate risk. what were they all doing? you know, and i think pardon they were they were so busy doing, you know, this bureaucratic stuff they forgot to look at interest rate risk. and so yes, time to step back and just clean it up. but i also agree with you by the way. you know, having caused you to flip flops is not a good idea. but let's finish some of this stuff. and i think we could make banks virtually fail safe. you know, let's let's go around and have a

conversation about how to do that as opposed to academics. and literally they're all academics, you know, just, darling, more rules and regulations about things they simply don't understand. and i do think it could free up a lot of capital to be used better, you know, and to help, you know, grow the world and grow the economy. and, you know, free the banks to what they're supposed to do. and we and remind me we have the best national system in the world. let's keep it that way. let's not hamstrung it, make it internationally less competitive. let's make sure we're doing the right thing. >> so you have 60 billion in excess capital potentially if basel three capital rules don't get enacted. this morning there was an announcement that you plan to use 50 billion of balance sheet capital toward direct lending. how else do you see kind of the use cases for that 60 billion, if ultimately you don't have to hoard it for some type of shock? >> i don't mind having extra. i mean, it's a pretty difficult world out there. extra feels good to me. and remember, our market cap is over 7 billion. so 10% of what you would call our market cap. capital to me is

very basic, which is first you pay a dividend and that's that should basically be sacrosanct. so it should be conservative. now obviously when things get really bad i've cut dividends twice here. you know and that's out of preservation i think it's a wise thing to do. and after that, the best and highest use is your own organic growth and real organic growth. new branches, new bankers, new technologies, and organic growth is hard. you know, it's like get add people, train people, open these branches. we need real estate people. we need hr people. we need legal people. we need leases to be signed. we need equipment to be moved in. we need to train people. we need to market the brand, stuff like that. so organic, organic, organic, then you know, m&a is okay. you know emma's got all these risks to it. it can always slow you down on the organic. it can slow down innovation if you're not careful. and then stock buyback you know. but stock buyback to me is you should buy back the stock when

you think it's cheap. and so we've been very reluctant to buy back stock at these prices. and we'll have opportunities. but one day we'll deploy that capital in a way that's very good for our shareholders. >> the stock near record highs. i have to ask about work from home. there have been a slew of headlines lately about what appears to be an internal debate within jp morgan over the firm's five day a week in-office mandate, including a leaked audio recording from a town hall in ohio that was obtained by barron's. what's what's going on? what's going on with. >> town halls all around the world? and as you know, i wrote sometimes you probably been to so many town halls. i should never curse. ever. okay. and i shouldn't get angry or stuff like that, but. and the gentleman asked a long question and i answered the question. i try to give a lot of detail, which i think is titled because i've never, ever fired anyone because they asked a question like that. i completely respect people that don't want to go to the office, you know, all five days a week. that's your right. it's my right. it's the citizens, right. but they should

respect that. the company is going to decide what's good for the client, the company, etc, not an individual. and so they can get a job. i'm not being mean, they get a job elsewhere. i understand that it may make total sense for them to do that. and i also respect the fact that other companies are going to try a different way to grow. and i think there are a lot we do have 10% of jobs that are full time at home. you know, we built these virtual call centers in baltimore and detroit. i'm not against work from home. i'm against where it doesn't work. and i gave all the reasons for that. and so, you know, there's a petition, but maybe 1200 people, that's fine, you know, and they have the right to feel that way. but we're not going to change. we're going back to the office. and i'm sure when we do, there will be some seats not available. and but for the most part, most of our people understand what we need to do it. in that same town hall, you reportedly spoke about some of the dei efforts and some of the spending choices, saying, quote, i saw how we were spending money on some stupid stuff. i'm paraphrasing there and it really

upset you. you're going to cancel them. i don't like wasting money on bureaucracy, given that there's this whole debate over dei right now. i'm curious what you found wasteful. yeah, when you looked at it. >> yeah. so we obviously have to modify your plans, but we look at our policies all the time. so you know me a little bit. i look at that all the time saying, why are we doing that. and it could be in any subject. we've been we've done the same in dei a little bit. so it's things like trainings that don't work or too many of them meetings that don't work. you know, people are hiring outside consultants for meetings and events. i don't like that, you know, you know, there are a whole bunch of stuff like that, a lot of small programs that just kind of a kind of just grew over time to kind of consolidate them. they're all very rational. we're still going to reach out to the black, hispanic, lgbt, veteran, disabled communities. we're not changing that. you know, it's 95% commercial. you've been in our community branches and most of the places i go, governors

and mayors, both republicans and democrats, they like what we do locally. we lift up their country and stuff like that. we have great training programs. we recruited more hbcus. but if we did something wrong with that, we're going to fix it. i never had a problem admitting that we did too much or we need to change something. >> all right, jamie dimon, we have to leave it there. but i really appreciate your time today here in miami beach. jamie dimon, the ceo and chairman of jp morgan chase. >> everyone keep the faith, folks. >> thank you. i'll send it back to you. kelly. >> leslie, thank you very much. leslie picker interviewing jamie dimon, the jp morgan chase ceo and chairman. a couple of headlines on the wires, his comments about the consumer. he says, we see the consumers are kind of back, almost going back to normal and then reiterating his views on tariffs, which we've heard before. but again, in light of everything that's happened, he said, look, if tariffs are used to protect national security, that is paramount and that transcends if it causes a little inflation. let's bring in david zervos. he is standing by. he's the chief market strategist at jefferies and a cnbc contributor dave, what jumped out to you. welcome. >> yeah it's always great to

listen. >> to jamie. >> he's a. >> fantastic speaker. >> and we all listen to his his leaked audio and i think had a smile. and i. think the deregulation is what's going to stand out to me kelly. that's our big push this year at jefferies. we think that's underappreciated by markets. markets are spending a little bit too much time getting obsessed about inflation risks with tariffs and immigration policy and to some extent reckless fiscal policy, and really are missing the big picture on a smaller federal government and a smaller federal government footprint and less regulatory burden, which i think you spent a lot of time on. the only thing i would take a small objection to is the inflation risks. i really think that inflation risk story is also being overplayed by the market, and we'll see a lot more disinflationary disinflationary momentum as we move through this year and next. >> well. >> so just to back up for a second, when he was asked about whether i would be disinflationary, he said, you know, not in the short run. he

said you know, we are spending more money on it than ever right now. and that at this point he only really sees those pressures going in one direction and to the upside. >> yeah, i mean, it's a sensible analysis. you've got a lot of spend on data centers. you've got a lot of spend on on the buildout of the infrastructure that's associated with it. and the payback comes later. so i think there's a cogent story that he's spending. but these things operate quickly. and we're already seeing, you know, you probably played around with things like deep research and a few others. i mean, these are these are going at light speed and they're really changing a lot of our productivity. so i, i'm more optimistic that that happens faster. but i think some of the other disinflationary forces that were with us before covid say things related to demographics are still very important. and to me, rates are still highly restrictive. and probably when one of the more restrictive places in monetary policy that we've been in in a long time, as the balance sheet is contracted and we've been doing all this sht. so i think people are overplaying the

inflation card. they're overplaying the risks on inflation from tariffs and immigration policies, and they're underplaying the disinflationary side of lower costs associated with less regulation. that is a huge, huge difference. >> what about on the consumer? here's what i'm struck by, david. the very moment that the market has kicked up some concerns about the consumer picked up in that report friday, picked up in this retail spending figures picked up in the walmart sort of guidance. he came out. and he's often the cautious one when the markets are off to the races. and he comes out and says the consumer is almost back to normal. he certainly didn't sound a note of alarm there. and maybe that's helping the market tone this afternoon. >> could be i mean they have a lot of data, you know, $3 trillion plus balance sheet. they're not messing around. so they see a lot more data than a lot of us, others a lot of others out there. but that said, you know, i could tell a story, kelly, that is a little bit more neutral to even slightly negative going into the middle and end of this year. we've got

a lot of people hearing about job losses, seeing job losses, cutting back federal government contracts. the spending cuts are real. the sort of cut backs out of dc are are real and the cutback on regulation is real. so i think all of that is kind of going to play in the psyche. we've seen it a little bit in the consumer sentiment data. there is some political bias in that data. you see different responses for democrats over republicans. but i i'm sort of i'm not completely neutral here on the economic outlook. i think there could be some softness. and we played for it this year by having our risk parity trades on. and i do believe that a big fixed income position is warranted as a hedge to equities. >> but because you. >> know what, that play for it 100%. >> because you've been much more bullish than than, you know, most of the commentators, i would say on sort of the macro side the last couple of years, and now you're striking a more cautious tone here. the same thing. dean mckee, similar as you, very much more bullish the last couple of years than many never was part of the recession call a couple of years ago. he's

now more cautious. we heard what steve cohen you know said what he said to faber, what he said in that interview last week, a number i mean, so when we ask about the soft patch, we're not just talking about january, we're talking about why are you and dean and a number of other people who've been long experience in the markets seeing saying, hey, you know, all of these could add up to a slower economy? >> you know, look, i have a lot of respect for dean. i've known him a long time. he's a fantastic economist. there's a lot of us that didn't get caught up in the recession call. and i think that was a big deal in 2023 and 2024. that was where the mainstream was. and i had my particular reasons related to the fed's policies, particularly on the balance sheet. but i think others others kind of tagged along with that, maybe had some other, other, other theories that they were playing. and we'll never know exactly what the theories were that worked. but i think a lot is lining up for just a little bit of a little bit of a consumer that that pulls back a little

bit and you're hearing it in business sentiment to one thing i think happens when we get more uncertain policy, kelly, is people they don't lever up as much, they don't take as much risk because there's so many different things flying around between tariffs and immigration. and they're just like, you know what? let's let's wait on that new purchase. let's wait on that new investment. let's wait on that. you know, that that big leveraging up of our business model when things are stable, people love to leverage. they love to put leverage on their business because they feel things are stable. when things are unstable, people deleverage a little bit. and i think that deleveraging is probably healthy for us. it's actually probably stabilizing in the long run, but it could create a little bit of a slowness. and i do believe that will be offset. kelly, by federal reserve policy. if the fed sees weakness, we're going to get lower rates faster than the market is predicting and the equity market will be fine. i got you all right. >> dave, thanks. appreciate it. and i just want to show the audience caught that that owning bonds for you is the play here

to kind of offset or hedge that risk. really appreciate it dave. thanks dave zervos. joining us from jefferies. i want to just quickly mention what's going on with alibaba down sharply today. speaking of the volatility. it was up. now it's down massive i capex announcement is to some extent to blame here. let's bring in deirdre bosa for more in today's tech check here joe. >> hey kelly. so at its core this is all about the ai spending boom and investor concern. that massive investment isn't justifying the return on investment which jamie dimon touched on too by the way in that great interview. so in a blog post this morning, the chinese e-commerce and cloud giant said it plans to invest at least $54 billion over the next three years to advance its ai infrastructure following the ramp in capex from our own hyperscalers. but in baba's case, here's where it's very different. the ramp up is nearly eight times its most recent quarterly profit, and it's more than what alibaba has spent on cloud and ai over the last decade. now, this also touches on a broader debate that's been bubbling up over potential overcapacity, which microsoft ceo satya nadella introduced

last week on a podcast. he said there will be overbuild everyone is racing to build and microsoft can be a leader, suggesting that there's a cap on microsoft's own capital expenditure even as others are ramping up. it's also touches on the point that leslie picker brought up with jamie dimon. she asked him for his thoughts, and he said something that i thought was interesting. he said that he told her there may indeed be overbuild, but it will all even out. and as with other technologies like the internet, there will be fits and starts. so touching in on that too. and i think that's probably safe to say. back to you, deirdre. >> really appreciate it today. deirdre bosa bringing us that news. and that's it for the exchange i'll join brian sullivan for power lunch right after this break. >> tech check is sponsored by >> tech check is sponsored by comcast b (vo) explore the world the viking way from the quiet comfort of elegant small ships

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