JPMorgan Chase CEO Jamie Dimon says the U.S. banking disaster shouldn’t be over and “there shall be repercussions from it for years to return.” The chief added that latest financial institution failures “have considerably modified the market’s expectations,” and the percentages of a recession have elevated.
JPMorgan CEO Jamie Dimon on U.S. Financial system, Recession, and Banking Disaster
Jamie Dimon, chairman and CEO of JPMorgan Chase, shared his issues relating to the U.S. economic system, recession, and the banking disaster in his annual letter to shareholders, printed final week. The letter adopted the latest collapse of a number of main banks within the U.S., together with Silicon Valley Financial institution and Signature Financial institution. Calling latest financial institution failures a “banking disaster,” Dimon warned:
The present disaster shouldn’t be but over, and even when it’s behind us, there shall be repercussions from it for years to return.
“Latest occasions are nothing like what occurred in the course of the 2008 international monetary disaster (which barely affected regional banks),” the JPMorgan boss defined. “At the moment, there was huge leverage just about in every single place within the monetary system.” In distinction, he famous: “This present banking disaster includes far fewer monetary gamers and fewer points that have to be resolved.”
Commenting on the Federal Reserve’s efforts to curb inflation and future take hikes, Dimon opined:
If now we have increased inflation for longer, the Fed could also be pressured to extend charges increased than individuals count on regardless of the latest financial institution disaster.
As well as, he cautioned that quantitative tightening (QT) “could have ongoing impacts which may, over time, be one other pressure, pushing longer-term charges increased than at present envisioned. This will happen even when now we have a gentle — or not-so-mild — recession, as we noticed within the Seventies and Nineteen Eighties.”
Dimon defined that the failures of Silicon Valley Financial institution and Credit score Suisse “have considerably modified the market’s expectations, bond costs have recovered dramatically, the inventory market is down, and the market’s odds of a recession have elevated.” He emphasised:
Whereas that is nothing like 2008, it’s not clear when this present disaster will finish.
Nonetheless, the JPMorgan govt insisted that the present economic system is “fairly good” however reiterated that there are “storm clouds forward.”
What do you consider JPMorgan CEO Jamie Dimon’s view of the economic system and the banking disaster? Tell us within the feedback part under.
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