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 Jamie Dimon's Annual Letter to JPMorgan Shareholders
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“Warren Buffett on Practically Everything”
Why Annual Letters
Are Important

Jamie Dimon, the Chairman and Chief Executive Officer of JPMorgan Chase, is known for writing a far-ranging and thought-provoking annual letter to shareholders. His annual letters are noteworthy for the big picture insight they provide on economic and policy issues. His annual letters are also noteworthy for being a good example of how CEOs can use annual letters to discuss larger themes, as well as last year’s corporate performance. In the following excerpt from Edition #5 of my newsletter, I discuss a couple of the major reasons why Dimon’s 38-page annual letter accompanying the 2011 annual report for JPMorgan Chase is worth a closer look.


First, Dimon’s annual letter contains some good news. “Housing is getting better.” With the economy improving, more jobs being created, more households being formed, the U.S. population continuing to increase and better housing affordability, Dimon’s letter states that “the turn [in the housing market] is coming if it is not here already.”


Second, Dimon’s annual letter is noteworthy for what it says about financial regulation. The letter states that it has been estimated that there are 14,000 new regulatory requirements that will be implemented over the next few years. The compliance costs for JPMorgan are huge. “Over the next few years, we estimate that tens of thousands of our people will work on these changes, of whom 3,000 will be devoted full time to the effort, at a cost of close to $3 billion.”


While Dimon states that he agrees with the intent of most of the financial reforms passed by Congress, he notes that “the result of the financial reform has not been intelligent design.” Some of the regulatory reforms are inconsistent with each other and hundreds are uncoordinated. “Simplicity, clarity and speed would be better for the system and better for the economy.”

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