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- 1 Jamie Dimon recently remarked that as the U.S. economy is doing quite well, it would be a “huge mistake” to believe that it will last for years.
- 2 Dimon shares that there are many risks ahead while adding his concerns.
At a financial conference in New York, on September 11, 2023, Monday, the CEO of JPMorgan Chase, Jamie Dimon, talked about the economic condition in the U.S. During the talk, his concerns included central banks reining in liquidity programs via quantitative tightening, the Ukraine war, and governments around the world spending like drunken sailors.”
According to a recent CNBC, a media outlet, report, in 2022, Dimon warned that a potential economic hurricane was on the way, pointing to the same concerns around central banks and the Ukraine conflict. However the U.S. economy has “proven resilient, leading more economists to expect that a recession might be avoided,” the report stated.
Jamie Dimon Concerns Related to the U.S. Economy
Jamie Dimon explains his statement as he said: “To say the consumer is strong today, meaning you are going to have a booming environment for years, is a huge mistake.” At present, healthy consumer balance sheets and rising wages are supporting the economy but there are risks ahead.
Dimon also said “Businesses feel pretty good because they look at their current results. But those things change, and we don’t know what the full effect of all this is going to be 12 or 18 months from now.”
Meanwhile, JPMorgan and other banks have been “over-earning” on lending for years due to historically low default rates, strains emerging in parts of real estate, and subprime auto lending, the CEO of a financial holding company further added.
“If and when you have a recession, which you’re eventually going to have, you’ll have a real normal credit cycle,” Dimon said. “In a normal credit cycle, something always does worse than” expected, he added.
Jamie Dimon’s Views on Different Areas
According to the report, the CEO of JPMorgan struck a note of caution during the panel discussion. He said his company is repurchasing stock at a “lower level” than before, a pace which might last through 2024, as the bank husbands capital to adhere to upcoming rules.”
Dimon addressed the new regulatory mandates as “hugely disappointing” while pushing for greater transparency from regulators. He said that “JPMorgan would have to hold about 30% more capital than European banks.”
When Dimon was asked whether the IPO and merger markets were picking up given the upcoming Arm listing, he said he “encouraged CEOs to take action rather than waiting too long.”
The future possibility for JPMorgan operations in China went from looking bright to only “just OK” because of the rising risks, Dimon said. As he said, “I don’t expect war in Taiwan, but this can go south.”
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
