JP Morgan 3Q17 Earnings Call Notes

Mariane Lake

We are constantly under attack

“not to diminish the importance of any individual breach or situation, is that we are honestly under constant attack, both in a more general side but also from a fraud perspective, and so while we always react and learn lessons from every individual situation, this is not the first breach nor will it be the last breach, so as a result we have been constantly evolving and refining the way we think about fraud prevention, detection, underwriting, continuing to move to multi-factor protocols around customer identification, looking to leverage all of our data to better inform our underwriting decisions.”

Nothing really has happened much since last quarter

“obviously apart from the rate hike in June, nothing has really happened much since last quarter, and so the landscape is looking pretty similar, and not because that’s surprising, so I’ll come back to that in a second, which is to say that there’s been very little to no movement in the re-pricing of deposit account”

Tax reform a factor but not a driving factor

“Tax reform, so fiscal stimulus, the reality right now is although I think everyone, and ourselves included, are hopeful, obviously that tax reform is done for the right reasons and that the economy responds accordingly, at this point it’s not front and center in the dialog we’re having with our clients about whether they should or shouldn’t do a strategic deal or take an action, so I would say it is neither holding up business nor spurring business, but that could change. So at this point, I’d say it’s a factor but not a driving factor, and that could change.”

Not seeing any deterioration in credit

“although we absolutely expect at some point that we’re going to see normalization of credit, we haven’t seen that yet – I just want to make that clear. We are appropriately cautious and staring at everything, but we’re not seeing any deterioration or any thematic fragility in our portfolio that we’re concerned about at this point.”

JP Morgan at Barclays Conference Notes

Jamie Dimon – Chairman and Chief Executive Officer

US economy doing fine

“The U.S. economy is doing fine, it’s been chugging along at 2%, less than 2% on average probably for the last seven or eight years. It’s the longest – one of the longest recoveries we’ve ever had, 10 years is the longest, I don’t think that has end to not end. I would say a very important factor is it’s been half of a normal recovery.”

Synchronized recovery

“I think the question that then comes to me is, why is it half of a normal recovery and if you do a quick turnaround the world by the way, Europe is doing better than 2%, Japan is doing 1.5% to 2%, China is going to make is 6%, Brazil has gone from negative 4% to 0%. So you kind of have for the first time called synchronized, the first time like 12 years, just about everything is starting to grow a little bit, which I think is a plus for everybody.”

Regulatory environment not changed a lot because don’t have people in their jobs

“I think the regulatory environment has not changed a lot because we don’t have the people in their job, so you now have the OCC head which was passed by the Senate, Randy Quarles, Fed Chair, Vice Chair just passed by the senate. You don’t have an FDIC person yet, so you are not going to have these huge changes in regulations. We don’t expect to have any regulatory legislative changes so that’s not our hope or belief. We do think the treasury laid out a very good math of issues that that should be looked at all calibration.”

Hoping that QE reversal is seamless but who really knows

“The QE is still going on, so like even in the last couple months something like several $100 billion of purchased securities, all you hear now is talk about reversing that….QE, I’m hoping, I think the circumstance which they reverse it are important, so if you have a healthy economy and they are kind of raising rates and reversing QE that is very, very different than if something else is going wrong. I think it’s a little bit of wishful thinking, so I’m not predicting bad things, but you don’t really know, it is going to be a multi-year plan. We hope it’s seamless, we hope it’s painful, the hope the economies are good, what is the chance if not? We never had QE therefore we never had the reversal of QE and it will have some consequences when people reverse it.”

My view is hold onto your hats

“So my view is, hold onto to you hats, it’s not clear and we are going to be sitting here from a year some might get hurt, things might be more volatile of the economy…So, I think that we can’t expect serendipity forever, so as a company while I’m not predicting bad things, we’re always prepared for it.”

One day people will panic

“It’s definitely cyclical folks, I mean you have a volatile market one day again, markets and markets people panic, people panicked in 2008 and 2009, they panicked in the 1989, they panicked in 1994, they panicked in Asia in 1997, they panicked in the Internet thing in 2000, the people will panic, you will panic. You will all be running through the door like everybody else and regulators will panic and – come on, and I just said, the government support $12 trillion securities that has to have some effect on depressing volatility, particularly around all the benchmark, all the benchmarks. Remember the benchmarks do affect the non-benchmarks and stuff like that. So market will become more normal again one day and again I think the most important thing to keep in mind is the why”

Credit is almost the best it’s ever been

“Well, it’s not credit. You know if you look at credit, it’s almost the best it’s ever been ever, so also my credit card, middle market, large corporate, there are tools, there is exception of subprime, I do think somebody get hurt leasing in subprime, but it’s not systemic, there is problems to lending, but it’s owned by the government which means you’ll never know about it, though you will pay for.”

Bitcoin is a fraud

“The currency isn’t going to work okay you can have a business where people can invent a currency and that’s in air. And think the people who are buying it are really smart. It’s worse than two of the balls okay it won’t end well. And it won’t end well for two reasons. One is someone’s going to get killed and then the government is going to come down. The second is you just saw in China governments like to control their money supply. The first thing a nation does when it forms itself literally the first is form a currency they have a bank and it has some kind of support legal support legal tender sometimes support like gold or silver that is a currency. So whatever and where think that bad that is this one is worse. So it will blow up China just kicked them out it’s selling through its money somewhere else it will be but I don’t ask me if it is short I’m not going to it could be 20,000 for this happens, but it will eventually blow up it’s a fraud okay. And honestly I’m just shocked anyone can see it what it is.”

JP Morgan 2Q17 Earnings Call Notes

Marianne Lake

Expect normalization in September and rate hike in December

“So on the balance sheet, it is still the case that we expect to start seeing normalization in the balance sheet, in September, if not in September by the end of this year with the actually calling for the next rate hike in December the market is calling for March of next year. And as we said the communication has been pretty consistent and pretty clear across the Fed space, which is to say that is mostly price into the market at this as far as we can tell.”

Fed shrinking balance sheet is likely to slow deposit growth

“we would see the balance sheet shrink about $1.5 trillion over about the next four years. So that would ultimately slow growth not stock price and if we saw a $1.5 trillion come out of the Fed’s balance sheet empirical evidence would suggest that we don’t see dollar for dollar reduction in deposits. So if you just pick a point between 500 and a $1 trillion of deposit outflows at our 10% market share that would be about $75 billion over full-year. So it would slow growth. It would not stop growth and it is what we’ve been expecting and what we’ve been talking about now for an extended period and gradual is good enough. In respect of which deposits we would like to see, so that’s the sort of growth scenario.”

Jamie Dimon

Jamie Dimon’s diatribe

“we would see the balance sheet shrink about $1.5 trillion over about the next four years. So that would ultimately slow growth not stock price and if we saw a $1.5 trillion come out of the Fed’s balance sheet empirical evidence would suggest that we don’t see dollar for dollar reduction in deposits. So if you just pick a point between 500 and a $1 trillion of deposit outflows at our 10% market share that would be about $75 billion over full-year. So it would slow growth. It would not stop growth and it is what we’ve been expecting and what we’ve been talking about now for an extended period and gradual is good enough. In respect of which deposits we would like to see, so that’s the sort of growth scenario.”

JP Morgan at Morgan Stanley Conference Notes

Gordon Smith – Chief Executive Officer of Consumer & Community Banking

Extending into lower prime areas because economy/employment look good

“Yes we have extended slightly into that lower prime, if you like segment, certainly not into sub-prime, but we have extended slightly our credit box. In about 2013 2014, everything that we read in the numbers we feel comfortable that we will get paid for taking that extra risk. We are going to sub-prime lending, but we are seeing growth actually across all segments and I think it is actually quite encouraging when we look at the economy, I am sure we will talk about that a little bit later on, but the employment situation looks strong, small business looks strong, and actually slightly improving I would say, slightly improving. So generally speaking, despite perhaps what you might read in some publications or the perspective that some people might take away from the media, I think the economy actually looks very good and we’re seeing that growth as I say across all the credit range. ”

Amazon is really an amazing company

” The Amazon relationship is a terrific one, a really terrific one. It is an amazing company. The way that they have thought about the business in every segment that they play in, they really understand the use of data, as we do, so it is a terrific partnership, it is in the co-brand product, it truly is a general-purpose plastic product, and we do see meaningful use of Amazon on that product. So that is in private label.”

Definitely not the time to be loosening standards in auto loans

“So, Jimmy I will go back to the way I described. I wouldn’t say that this is a moment of tightening and this is a moment of weakening – of loosening that’s something we are constantly watching. As I say, vintage by vintage. It is not in my opinion a time to be loosening your credit standards, no questions. I think the industry is at a point where it should be rigorously managing credit and so – and I hesitate a little bit because it sounds very binary between those choices and as I say it’s done well, it’s about being much more surgical than that, and to some degree honestly there is instincts involved.”

JPMorgan Chase’s (JPM) at Morgan Stanley Financials Conference

Gordon Smith – Chief Executive Officer of Consumer & Community Banking

Growth in credit across the ranges

“…everything that we read in the numbers we feel comfortable that we will get paid for taking that extra risk. We are going to sub-prime lending, but we are seeing growth actually across all segments and I think it is actually quite encouraging when we look at the economy…I think the economy actually looks very good and we’re seeing that growth as I say across all the credit range. ”

Reserves are being rebuilt in credit cards

“…we are now in a cycle where reserves are being rebuilt, they are not being released in credit card, I guess across most players – across most players in the industry, but going back, we have guided that we’ve typically have underwritten the newer vintages towards plus or minus 4.5. It will take us a while to get there, but we will see, we and the industry will see a rise in losses and the reserve builds to go with rise in losses and with rising loan growth…people still seem to be surprised that we are at the end of that cycle that we have never seen in the 50 years of lending money on credit cards, I was not there the whole 50 years, but we have never seen losses this low, and then I will begin to migrate back up to more the historical averages over time and it will take a while to get there.”

They are harnessing the power of big data

“we have an organization called Intelligent Solutions, which just brings the enormous power of all the data that we have to help target who are the right customers for the products that we have. That has significant financial returns because we are able to invest their marketing dollars in the right way. So the power of big data is really clear for us.”

JP Morgan Chase (JPM) at Deutsche Bank Conference

Marianne Lake – CFO

Don´t give up on reforms

“…we still remain very hopeful that there will be policy and reform on the agenda. I think it’s hard because everybody was super enthusiastic out of the gate, but the reality is all of these things is they’re extraordinarily hard and there are reasons why tax reform hasn’t been successful over the course of the last several decades…I don’t think it’s time to give up the belief….there’s significant reasons to be optimistic and in any case, as we’ve said many times before, just pausing in and of itself is a positive thing.”

But the status quo remains for now

“The flipside to that…is that nothing has actually changed and so when we come into work every day right now, we still need to work hard to comply with the rules as they currently stand to uplift our environment to the degree that we’ve been asked to do that, to continue to get ready to comply with rules that will be coming down the pipe, and so we can’t sort of take our foot off the pedal or eye off the ball in that sense. So in that sense, it’s sort of hurry up and wait.”

Optimism has faded a bit

“The levels of optimism are still high, they’re still higher than pre-election. They may be off slightly from their peak, but I think generally people are still feeling that the pro-growth agenda is real. How exactly it ends up being manifested in reform and policy action over the course of the next six, 12 months is still an unknown.”

A subdued trading environment

“I would say as a sweeping generalization, but it’s pretty broadly true, low rates, a more cautious outlook on rates, low volatility with very small bouts of increased volatility but then returning back to low levels, have led to low client flow and a generally quite subdued and challenging trading environment for the flow businesses.”

Q2 revenues likely to be down

“I will tell you that quarter to date across our markets businesses, we are down about 15% year-on-year. That’s pretty normal seasonal declines in the first quarter and second quarter…That’s fixed income down more and equities up slightly, and as I look to June, I would say I don’t see any particular reason for that to change, particularly given the strength of our June last year.”

Consumers in good shape

“…consumers are in very good shape. Their balance sheets are repaired, they’re pretty liquid, their debt to income ratios are pretty low, debt service burdens are pretty well insulated from interest rate hikes because interest rates have been low forever, and they’ve been able to refi debt at–term out at low rates….So generally speaking, consumers feel very well insulated from rate hikes, particularly if they’re gradual….the central case is gradual improvement in rates or normalization of rates, consumers are able to in large part withstand that very well. “

JP Morgan at Deutsche Bank Conference Notes

Marianne Lake – Chief Financial Officer

The reality is that these policy things take time

“I mean, I think we still remain very hopeful that there will be [indiscernible] policy and reform on the agenda. I think it’s hard because everybody was super enthusiastic out of the gate, but the reality is all of these things is they’re extraordinarily hard and there are reasons why tax reform hasn’t been successful over the course of the last several decades. It’s because it’s complicated, and so I think it’s–you know, we’re four or five months into the new administration, and while it would have been helpful to have some more scores on the board, I don’t think it’s time to give up the belief that–you know, we know a few things. We know that they’re deadly serious about reform in multiple facets, we know that they have smart and capable people around them, there’s bipartisan support particularly for certain aspects of tax reform and regulatory reform, and anything that’s constructive for the country and the economy and pro-growth is constructive for our clients, so we are trying to be as engaged and constructive as we can be, and we still see all of those things on the agenda, it’s just they take a little time and I think that’s a reasonable expectation.”

Confidence levels are still high

“So meanwhile, we have to keep the wheels turning and doing what we’re doing and serving our clients, and so there’s no actual change. The levels of optimism are still high, they’re still higher than pre-election. They may be off slightly from their peak, but I think generally people are still feeling that the pro-growth agenda is real. How exactly it ends up being manifested in reform and policy action over the course of the next six, 12 months is still an unknown, but I think the seriousness with which it’s being approached is something to applaud and we should all welcome it and be as constructive as possible, and so that’s the approach we’re taking.”

We feel that accreting further capital is not necessary

“So on capital, we’ve been pretty vocal and consistent for a number of years now that we think that the company can be run safely and soundly at around 11%; meanwhile, for a variety of reasons, we’ve been sort of operating in this capital corridor of 11% to 12.5%, and at this point we’re at the high end of that range. This year at investor day, we made the clear statement that we feel that accreting further capital is not necessary, and moving down in the range over time would be our preferred strategy in the absence of any new news, and so that really hasn’t changed.”

CCAR is the predominant binding constraint to returning more capital

“As you look at the capital agenda, CCAR at the moment is the predominant binding constraint for most of the large banks in the U.S., and so reforming CCAR through the way its implemented and supervised, I think is a real possibility, if not a probability. And even in his outgoing speech, Governor Tarullo laid on the table a number of meaningful improvements that seem somewhat uncontroversial at this point, so number one, let’s phase out or eliminate the qualitative assessment test.”

Second quarter does look better than the first

“some difference of opinion about the second quarter and whether or not it will rebound from the first. Our view is first quarter continued the trend of having seasonal distortion in it. People are looking through that, second quarter does look better. Consumer spending in the first quarter was disappointing – that’s rebounding. Inflation data is disappointing, but other than that, jobless claims are the lowest since ’74, retail sales, industrial production, capex were decent. So I think if you smooth out the noise, the first half is going to be a 1.5 to 2% growth situation, which is pretty in line with our near-term historical averages, and so we’re, I would say, solid, not stellar but not reasons to be concerned at the moment. We’ll keep an eye obviously on the inflation data, and the Fed have said the same thing; but if you look forward and not spot, I think the general assumption is that will be somewhat transitory in nature too, so we’ll have to see about that. We’re seeing that in our businesses, so we’re seeing strong spend, we’re seeing decent loan demand, we’re seeing reasonably healthy capital markets activity, so it feels to us like it’s still a pretty constructive environment generally in the second quarter. While there are small pockets, so you know, auto sales have been a little softer over the last couple of months for maybe obvious reasons, then they’re pretty small and pretty modest in comparison to the bigger picture, so I think generally pretty healthy so far in second quarter. Nothing that we’re seeing in our client engagement, in the dialogue or in the activity is a foreboder of anything different from that at this point.”

I would say our central case for US rates is two hikes this year

“You know, I would say our central case for U.S. rates is two hikes this year, the Fed starts to shrink the balance sheet at the end of the year, slowly and under control such that it’s more in the background, so rates remain the major monetary policy tool that we’ll see a flatter but nevertheless somewhat normal yield curve, and that the 10-year will be, call it 2.75 at the end of this year. Maybe we’ll be wrong, but implies a 2.40 so you pick your number. We’re not seeing it going down.”

Consumers are in good shape

“consumers are in very good shape. Their balance sheets are repaired, they’re pretty liquid, their debt to income ratios are pretty low, debt service burdens are pretty well insulated from interest rate hikes because interest rates have been low forever, and they’ve been able to refi debt at–term out at low rates. I know that someone mentioned yesterday that the household debt burden has gone back to peak levels, but meanwhile GDP has gone up by 30%, so as a relative to income measure, it’s low.”

JP Morgan 1Q17 Earnings Call Notes

Marianne Lake

Loan balances up but have seen a slowdown in C&I growth

“Loan balances of $191 billion were up 12% over the prior year. Consistent with the industry broadly, we have seen a slowdown in C&I growth with our loan balances remaining relatively flat sequentially, although up 8% year-on-year. There are a number of factors likely contributing including potential noise in the data from large acquisitions in prior periods and a resurgence in capital markets activity, particularly in DCM including high yield. So, not to dismiss the importance of the trends, we do need to weigh all the facts and against that other macro indicators remain supportive of the economy broadly including CapEx, data and surveys, as well as very high levels of business optimism, all of which should be supportive of solid demand for credit over time.”

Clients are optimistic despite quieter sequentially

“I mean, we did have 8% growth year-on-year in C&I, we’re just saying sequentially things are a bit quieter and there are whole bunch of reasons that could be driving that. And importantly, you mentioned it, when we are in dialogue with our clients, they are optimistic and they are thinking about growing their businesses and hiring and all of those things are true. And so putting aside those and we have access to capital market for a variety of reasons in newer bank loans. And it’s completely understandable that optimism would lead actions. And so, what that implies, we’ll wait and see but fundamentally a pro-growth series of policies will be constructive to the economy, to our clients and ultimately will end up. And them hiring, spending and they already are, and we’ll see that translate into loan growth. Whether that’s in the second half of this year, we’ll see.”

Jamie Dimon

I wouldn’t overreact to short term loan growth decline

“I wouldn’t overreact to the short term in our loan growth with so many that affect it. When you go to the episodic part, when you look at CIB, I don’t look at loan growth at all because companies have a choice of loans and deals or bonds and like that. Credit card looks okay, mortgage is obviously affected by interest rates, auto is obviously affected by auto sales, and middle market was okay, it was slow but it was okay. So, I wouldn’t react to that. The second thing is, you all should expect as a given that when you have a new president and he gets going that nine months, after the 100 days it’s going to be sausage making period. There will be ups and downs, wins and loss stuff like that. And what you see is a pro-growth agenda, tax infrastructure, regulatory reform and that is a good thing all things being equal. And we think that it should be helpful for Americans. To expect it to be smooth sailing, that would be silly.”

JP Morgan 4Q16 Earnings Call Notes

JPMorgan Chase’ (JPM) CEO Jamie Dimon on Q4 2016 Results

Will get some regulatory relief

“Not going to change our plans very much because we don’t really react that much to the weather, because we grow to add bankers and stuff you know you have to do it through a cycle. I do think of it as regulatory relief. You will see banks be more aggressive in growing opening branches in new cities, adding to Loan Portfolios, seeking out clients they don’t have so I’m hoping to see a little bit of that too but they will wait for regulatory relief.”

We don’t react to the weather

“Not going to change our plans very much because we don’t really react that much to the weather, because we grow to add bankers and stuff you know you have to do it through a cycle. I do think of it as regulatory relief. You will see banks be more aggressive in growing opening branches in new cities, adding to Loan Portfolios, seeking out clients they don’t have so I’m hoping to see a little bit of that too but they will wait for regulatory relief.”

Lower tax rates will eventually be competed away

“And just on the tax side, so you understand generally, yes if you reduce the tax rates all things being equal to 20% of something eventually that increased return will be competed away. That is a good thing, so it’s not a good thing for JP Morgan Chase per se but it’s a good thing for the world, it’s a good thing for growth and a lot of studies actually show the beneficiary of that is wages and so it’s important to understand that good tax policy is good for growth and the country in general. It’s not just good for companies that will eventually be competed away”

You’re not going to know for nine months or a year on the tax stuff

“Listen you aren’t going to really know for probably nine months to a year exactly what it is so I wouldn’t worry too much about it and just remember the most efficient companies do benefit from things like this more than others.”

Marianne Lake

Credit performance remains strong

“Finally credit performance remains strong, with a net charge-off rate of 11 basis points, driven by a couple of oil and gas names largely reserved for. And we saw a modest increase in loan loss reserves driven by some ex-client downgrades. In CRE, we had no net charge-offs, and we reiterate three quarters of this portfolio is multi-family lending, to own as a stabilized Class B and C properties in supply-constrained markets. And the remainder is real estate developers that we know well, and we continue to be disciplined, and limit exposures to riskier segments of the market.”

Will grow loans in 2017 but maybe a little bit slower

“Yes, so I think the way to think about it, and again, I think we talked a little bit about it last quarter, and you maybe see it in the fourth quarter. So we’ve been growing our loans in the 10-15%, we revised that to be at the top end of that range so we’ve been growing at around 15% core loan growth, the fourth quarter was 12%. So I wouldn’t call it a deceleration per se, but know it is a little bit lower so I think going into 2017 our expectation is that we would continue to grow loans strongly but possibly at the lower end of that range rather than the higher and of course, to a degree it will depend upon our mortgage portfolio but we intend to continue to add to that too, so sitting here today I’d say more high single 10% plus or minus and we’ll give you more updates at Investor Day.”

So far there has been more risk appetite from clients

“With respect to trading, Jamie said that we don’t look at the first couple of weeks, but so far so good and what I would tell you is we said this before where a client flow oriented business and there will be a lot of micro and event-driven activity and as long as it’s not discontinuous, we should be able to inter immediate transactions with our clients and so far, generally there’s been more risk appetite in the investor days but that can change very quickly as we saw in previous quarters so we will be there to support our clients and if they are active, everything should be good but it can change quickly.”

JP Morgan at Goldman Sachs Conference Notes

Jamie Dimon – Chairman and Chief Executive Officer

Hopefully the hope will be true

“obviously, the stock has done unbelievably well since the election and I think it’s based upon the hope. The hope is accurate that the Trump administration will be very good for kind of unleashed business per se and maybe improve the GDP and allow banks to do their lending and the banks will benefit a little bit both from higher rates and higher economic activity and possibly some reduced regulation. So, hopefully that will turn out to be true.”

Dodd-Frank didn’t have bi-partisan support so we’re relegislating it until it’s done bipartisanWe have needed corporate tax reform for a long time

“We have needed corporate tax reform for a long time, okay. We have the highest both statutory rate and effective rate of all the developed nations in the planet. We are driving capital overseas. And I have always said I have been consistent we are going to drive capital overseas and the only question is when we can stop the damage. And some of that damage is permanent. People have bought companies overseas. They built plants overseas. They have built research centers overseas. Corporate America is at a disadvantage. And I think we have to come, make that – bring the rates down and make it a competitive thing. That competitive thing, by the way, most studies show that will help wages, okay, that will help wages. So, it’s not just helping corporations, I think it’s helping wages. And obviously, the trade that needs to be done. Also we need to help the citizens of America, not just the corporations of America. So, it’s hard to accomplish, but I believe I am begging that it gets done.”

Consumer is healthy

“We see a fairly healthy consumer. And so if you look at macroeconomic data, home prices, the consumer balance sheet, debt service ratios, the number of people working, wages going up, etcetera, we see that pretty healthy. We see a mirror of that inside JPMorgan. So we have reporting quarter-after-quarter, credit card sales, deposits, new household accounts, all those types things are doing quite well and we expect that to continue.”

Commercial real estate late cycle

” The one area where you look at and you might say, oh my god, there is a little bit of issue, there is commercial real estate…We are cautious. It’s probably getting later in the cycle for some of that. And we don’t do what I would consider we don’t do now and we have never done the riskiest type of lending. So we have always been cautious in real estate.”

Sapphire Reserve card going to reduce earnings because of accounting treatments

“So the card is being doing great. So one negative, which I think is very good thing and I think we have told to the analysts, it’s going to reduce our earnings by $200 million or $300 million this quarter because how you have to account for acquisition costs in that business, because you have to get the revenues over 5 years, 6 years, 7 years, but your acquisition costs expense over 12 months, so doing great’

Cut waste, not expenses

we are always looking for, I always call, waste cutting. It’s not expense cutting, because companies are wasteful. There is bureaucracy. There is stupidity. There are vendors that are overcharging. I think it’s the way you are. So, we are always looking at ways to be more efficient, but always investing in what we should be investing.”

Buyback isn’t returning capital to my shareholder

“I personally don’t believe that buying back stock is giving cash to my shareholders. I think buying back stock is giving cash to my leaving shareholders. I care much more about the remaining shareholders. And so I want that to be a bargain. ”