Jamie Dimon explains interest rate cuts, the economy, and student loan crisis | Jabar Post Indonesia/a> – This time JabarPost.Net will discuss about Mortgage.
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Jamie Dimon explains interest rate cuts, the economy, and student loan crisis | Jabar Post Indonesia
A mortgage loan or, simply, mortgage (/ˈmɔːrɡɪdʒ/) is used either by purchasers of real property to raise funds to buy real estate, or alternatively by existing property owners to raise funds for any purpose, while putting a lien on the property being mortgaged. The loan is “secured” on the borrower’s property through a process known as mortgage origination. This means that a legal mechanism is put into place which allows the lender to take possession and sell the secured property (“foreclosure” or “repossession”) to pay off the loan in the event the borrower defaults on the loan or otherwise fails to abide by its terms. The word mortgage is derived from a Law French term used in Britain in the Middle Ages meaning “death pledge” and refers to the pledge ending (dying) when either the obligation is fulfilled or the property is taken through foreclosure. A mortgage can also be described as “a borrower giving consideration in the form of a collateral for a benefit (loan)”.
Mortgage borrowers can be individuals mortgaging their home or they can be businesses mortgaging commercial property (for example, their own business premises, residential property let to tenants, or an investment portfolio). The lender will typically be a financial institution, such as a bank, credit union or building society, depending on the country concerned, and the loan arrangements can be made either directly or indirectly through intermediaries. Features of mortgage loans such as the size of the loan, maturity of the loan, interest rate, method of paying off the loan, and other characteristics can vary considerably. The lender’s rights over the secured property take priority over the borrower’s other creditors, which means that if the borrower becomes bankrupt or insolvent, the other creditors will only be repaid the debts owed to them from a sale of the secured property if the mortgage lender is repaid in full first.
In many jurisdictions, it is normal for home purchases to be funded by a mortgage loan. Few individuals have enough savings or liquid funds to enable them to purchase property outright. In countries where the demand for home ownership is highest, strong domestic markets for mortgages have developed. Mortgages can either be funded through the banking sector (that is, through short-term deposits) or through the capital markets through a process called “securitization”, which converts pools of mortgages into fungible bonds that can be sold to investors in small denominations.
To call Jamie Dimon an influencer is an understatement. He’s a center of gravity around whom others orbit. Dimon took over JPMorgan Chase in 2005, just a few years before the financial crisis struck. He has since turned the bank into the country’s second-most lucrative business, raking in $32 billion in profits last year, the chairman of the powerful Business Roundtable and a board member at the Federal Reserve Bank of New York, Dimon is reportedly a billionaire. He’s here to talk about the changes that most profoundly shape the economy and what he’s learned up close from weathering them and optimizing them.
Hello, everyone, and welcome to “Influencers.” I’m Andy Serwer, and welcome to our guest, JPMorgan Chase CEO, Jamie Dimon. Jamie, nice to see you.
JAMIE DIMON: Thrilled to be here.
ANDY SERWER: So we’re in this new flagship branch of the bank. And I want to ask you about that. But first, I have to ask you, Jamie, first off about the economy and the stock market. The stock market’s at a record high essentially. And yet we have a trade war with China, trade disputes in North America and Europe, and rising tensions with Iran. How do you reconcile those two?
JAMIE DIMON: The market’s sometimes inscrutable. But if you actually look at geopolitics, they really affect the global economy. They could. You know, these things get worse. But they really affect the global economy. I think trade is serious.
So we have United States, for example, is a very strong consumer, good balance sheet, household formation. Wages are going up, particularly at the low end. Consumer confidence is very high. And business confidence has been very high, but it’s been rattled a little bit by trade.
So we’ve seen a little bit as business confidence drop, business investment drop. People are worried about the supply lines. And I think that may be hampering the economy a little bit. It’s kind of “A Tale of Two Cities.”
ANDY SERWER: And consumer confidence is down a little bit today.
JAMIE DIMON: It’s down a little bit, but still quite high.
ANDY SERWER: Right.
JAMIE DIMON: And so, you know, we have those two things collide. And what affects what, I don’t really know. The better thing is to have a deal in China. There are serious trade issues, you know. So we all want the president to deal with the issues seriously, which he’s been doing. A resolution would be good. But we don’t expect a quick resolution at this point.
ANDY SERWER: What do you expect out of the G20 in Osaka later this week?
JAMIE DIMON: Yeah. I think the best you can expect is that they have a good meeting, that that they start renegotiating that the tariffs are off for now and give the teams a chance to negotiate a deal, which maybe, if we’re lucky, it could be done by the end of the year.
ANDY SERWER: So let’s talk about this branch. I mean, obviously you guys have invested a lot here. But I thought that all banks were doing were shutting branches down. And yet, you know, this is a whole new way of doing banking for consumers.
JAMIE DIMON: Yeah, people in business, you always look at facts. I mean, we have a million people a day visit branches. So Millennials are doing it less, but they’re still doing it. We’ve got 50 million people on digital. We’ve got 21 million different customers a year going to a branch.
These branches support local small businesses. They support middle-market companies. They support consumers. So– and these new branches are great. So we started this whole expansion, 400 new branches in 20 major cities, right at the heart of some of our competitors, in some cases. And we always– we love new formats.
But this format is meant to be a flagship branch and a community center. So that when the people come here, those are coming through, we have a thing called Chase Chats. So you come here for a small business or individuals talking about investing or starting small businesses, you know, but have community groups come in and talk about some of things we do to help affordable housing. So we hope that these things will be just great for– for JPMorgan Chase. And we’re thrilled to be on the expansion trail again.
ANDY SERWER: I mean, it’s very experiential, right, isn’t it?
JAMIE DIMON: And that expansion trail is thousands and thousands of jobs.
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