JPMorgan Chase CEO Jamie Dimon last Wednesday, November 29, during a speech at the New York Times DealBook 2023 summit in New York, said that the likelihood of a recession in the United States cannot be ruled out.
Also, the head of the mentioned financial institution, which is one of the giants of the American banking sector, noted that the prospects for the dynamic of inflation in the United States are not unambiguously positive. In his opinion, this economic indicator may demonstrate growth shortly.
Jamie Dimon’s statements can be described as a warning to Wall Street. The head of one of the largest US banks unequivocally says that the economic situation in the country may deteriorate and currently there is no guarantee that the future in this aspect of the existence of the state and the life of society will be better relative to current realities.
Mr. Dimon pointed out that the current historical moment in the geopolitical plane is characterized by many dangers, which are a factor in increasing inflation. According to the head of JPMorgan, the prospect of continued interest rate growth shortly is a realistic scenario. According to him, the realization of this probability will provoke a recession situation.
Jamie Dimon says that governments around the world currently need more money. According to him, this need is due to the demand to finance projects related to the green economy, remilitarization, and solving problems of economic crises. In this situation, he sees a platform for the intensification of the dynamic of inflation.
Mr. Dimon said about cautious concerning the economy. He noted that the current situation in the labor market of the United States is characterized by a high level of stability, but at the same time drew attention to the fact that inflation harms people.
The head of JPMorgan, speaking through figurative and symbolic formulations, said that the stimulus funds that were allocated during the coronavirus pandemic, which caused the shutdown or slowdown of work processes in many industries, and the quantitative easing of the Federal Reserve System, injected drugs into the American economic system and provoked a sugar high in it. However, these realities are gradually dissolving into the space of the past, giving way to new circumstances of modernity. At the same time, Jamie Dimon believes that tightening, quantitative easing and problematic situations in the geopolitical arena can still be painful factors.
This year, the head of JPMorgan, while talking to media representatives, repeatedly admitted the possibility that the Fed has not yet come close to completing the implementation of its policy of aggressively raising interest rates, which is a strategy to counter the inflationary process. He also estimates as a realistic scenario an increase by the financial regulator of the said indicator by another 1.5 percentage points, to the level of 7%.
Speaking about the international situation, including in a political context, Jamie Dimon stated that the current historical moment is perhaps the most dangerous in recent decades. According to him, armed conflicts that are in an acute phase can provoke long-term negative consequences on a global scale related to the supply of energy and food. He also spoke about the risk of degradation of geopolitical relations and noted the factor of influence of the current state of affairs on the sphere of trade. Moreover, Jamie Dimon does not rule out the possibility that the world will face nuclear blackmail in the foreseeable future.
The head of JPMorgan says that humanity is in a situation of huge risks. In addition to military conflicts, climate change, the proliferation of nuclear weapons and the likelihood of a new pandemic are serious threats.
According to Mr. Dimon, the United States should make sure that its armed forces are the best in the world. He noted that this is an expensive task, but stressed that in this case, the stakes are too high. In this context, the head of JPMorgan stated the need to keep the Western world united, specifying that American leadership guarantees the corresponding state of affairs. He also said that he would not like to the implementation such a scenario of events, according to the results of which a book about the loss of the West will be written in 50 years.
At the summit in New York, Jamie Dimon said that as part of the issues of doing business in China, he intends to follow the example of the practice of the United States government in relations with this country.
JPMorgan is currently partnering with TikTok’s parent company ByteDance and is partially supporting the planned IPO of the Chinese fast-fashion company Shein. Jamie Dimon does not believe that interaction with these partners from Asia should be stopped. According to him, Shein is not a threat to the national security of the United States. Jamie Dimon also noted that the bank headed by him conducts a comprehensive security check of all customers. This was said in the context of statements by American lawmakers that TikTok is a threat to the national security of the United States.
As we have reported earlier, JPMorgan CEO Criticizes Central Banks for Wrong Forecasts.