Published: Sun, June 10, 2018
Medicine | By Tracy Klein

Bitcoin sceptic Jamie Dimon tells buyers to 'beware'

Bitcoin sceptic Jamie Dimon tells buyers to 'beware'

Warren Buffett, CEO of Berkshire Hathaway Inc, pauses while playing bridge as part of the company annual meeting weekend in Omaha, Nebraska U.S. May 6, 2018.

Warren Buffett has joined forces with Chairman and CEO of J P Morgan Chase Jamie Dimon to convince chief executive officers to end the practice of quarterly profit forecasts, reported CNBC.

In the op-ed, Dimon and Buffett said the pressure to meet short-term earnings estimates has contributed to a drop in the number of public companies in the USA in the past two decades.

"We have an outstanding individual - character, culture, capability, heart, mind, the whole thing", Dimon said Thursday on CNBC.

The pressure to meet short-term estimates has contributed to a fall in the number of United States public companies, wrote Buffett, the chairman of Berkshire Hathaway, and Dimon, who is also the chairman of top executives' lobbying group Business Roundtable, in a Wall Street Journal article on Wednesday.

"I have seen managements. get tempted by the predictions that they've made", Buffett said.

"It can put a company in a position where management from the CEO down feels obligated to deliver earnings, and therefore may do things that they wouldn't otherwise have done", Dimon said. As a result, corporations "frequently hold back on technology spending, hiring, and research and development" that would improve businesses' future growth, Buffett and Dimon say. Dimon said he could generate hundreds of millions of revenue for the bank by agreeing to some interest rate swaps. In the past, Buffett has said that he could record some of Berkshire's unrealized investment gains at nearly any time if he wanted to make a quarter or year look good, but that wouldn't help the company succeed in the long run. "We're hoping a bunch of companies drop it right away".

They told companies to move away from providing quarterly guidance. They plan to name the venture's first CEO publicly within two weeks.

The three corporate leaders said in January that their companies - Berkshire Hathaway, Amazon and JPMorgan Chase - would work together to give their combined 840,000 employees better health care choices.

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