Jeremy Barnum: Yes. Thanks, Erika. I mean it’s a good question. There is a lot in there obviously. I guess I would start by saying that when we talk about 17% through-the-cycle ROTCE, even though we may have introduced that in a moment where we brought the lowest eurobond, it was always premised on a sort of normalized rate environment. And at some level, that remains true today. Furthermore — you didn’t ask this explicitly, but in the context of the proposed Basel III end-game, one relevant question might be, if you have a lot more capital in the denominator, what happens to that target. So, I think — as I said in my prepared remarks, we feel very confident about the Company’s ability to produce excellent returns through the cycle.
There’s a lot of moving parts right now in that. Some of them could be good, some of them could be bad. Narrowly on the capital one, the one thing to point out is that the straight-up math, simply diluting down the ROTCE by expand the denominator misses the possibility of reprice, you know repricing on products and services, which of course goes back to our point that these capital increases do have impacts on the real economy. So, I’m not suggesting that we can price our way out of it, but we obviously need to get the right returns on products and services, and where we have pricing power, we will adjust to the higher capital. So lot of moving parts in there, but I think the important point is that through a range of scenarios, we feel good about our ability to deliver the results and we’ll see how the mix of all the various factors plays out, especially after we see the Basel III proposal and it goes through the common period.
Jamie Dimon: Erika, I’ll say one thing. Of course we have a mix of businesses that earn from like 0% ROTCE to a 100%. We have some which are very capital-intensive, so we look at kind of all of them and I think 17% is a good number and a good target. The other thing we’re earning on is credit. We’ve been over in credit for a substantial amount of time now, we’re quite cautious about it. We know that it’s going to kick-off just as a normalized it will be, considering more than that is now. Look, we would consider credit card normalized to be closer to 3.5%.
Erika Najarian: And, so my follow-up question there, maybe Jeremy, could you remind us what unemployment rate has embedded in your ACL ratio as of the second quarter?
Jeremy Barnum: Yes, it’s still 5.8%.
Erika Najarian: Thank you.
Operator: Next, we’ll go to the line of John McDonald from Autonomous Research. You may proceed.
John McDonald: Hi. Good morning. Jeremy, wanted to ask about capital in the wake of the par speech, we don’t have the details yet, but just kind of want to ask about options that you have and strategies for mitigation, both on RWA and potentially on the G-SIB front as well as you contemplate what you heard recently?
Jeremy Barnum: Yes, thanks, John. So, obviously, we’re thinking about that a lot. On the other hand, as much as there have been a lot of very detailed rumors out there that might lead you to start to try to do some planning, it does seem like this time it’s real and we are actually going to get a proposal, ultimately sometime this month or something. So sooner or not, we’ll get to see something actually on paper and we can stop kind of the guesswork. Having said that, indulging in a little bit of guesswork, it does seem like the biggest single driver of the increase that people are talking about including Chair, Powell’s 20% number or Vice Chair Barr’s 2% of RWA which runs up being roughly the same, is just the way operational risk is getting introduced into the standardized pillar.
