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Jamie Dimon urges preparing for an economic 'hurricane'

2022-06-01T23:32:38.061Z


JPMorgan Chase CEO Jamie Dimon predicts an economic "hurricane" from the war in Ukraine, rising inflation and rising interest rates.


IMF warns of worst economic crisis since World War II 1:07

New York (CNN Business) -- 

Jamie Dimon isn't a meteorologist, but the CEO of JPMorgan Chase is predicting an economic "hurricane" sparked by the war in Ukraine, rising inflation pressures and interest rate hikes. the Federal Reserve.


"Things are kind of sunny right now, they're going good. Everybody thinks the Fed can handle this," Dimon said at a conference in Bernstein. "That hurricane is out there, coming at us."

"We don't know if it's a minor one or Superstorm Sandy. You'd better get ready," Dimon said, adding that JPMorgan Chase is bracing for a "non-benign environment" and "poor results."

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Dimon said the economy is "distorted" by inflation.

He is also concerned that the Fed is starting to unpack its bond portfolio, a process known as quantitative tightening, at the same time it raises interest rates.

That's something the market isn't ready for, Dimon said, adding that people will be "writing about [this] in the history books for 50 years."

But the Fed is in a bind.

Dimon said the central bank must raise rates due to rising house prices and other inflationary pressures.

He stressed that he continues to think the US banking system is in "great shape" and can withstand these challenges.

Dimon also said that JPMorgan Chase is going to do everything it can to attract talent to stay on top of the financial world.

The CEO said the bank will be "religious" about paying well to retain its best workers.

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Dimon's more cautious outlook comes just days after he sounded slightly more optimistic about what lies ahead for markets and the economy.

Speaking at an analyst meeting in late May, Dimon said "big storm clouds" were on the horizon for the economy, but expressed hope that they might "dissipate."

"If it were a hurricane, I would tell you," Dimon said at the analyst meeting, adding that current conditions are also not like the "tsunami" banks faced in 2007 and 2008, when the mortgage market crashed and several large financial institutions went under.

Dimon may not be predicting a tsunami yet.

But a hurricane is bad enough, and certainly more damaging than any storm.

Dimon said he too is concerned about the conflict in Ukraine and the impact it will have on oil prices, predicting on Wednesday that crude prices could rise as high as $150 or $175 a barrel.

"Wars go wrong. They fail. They have unforeseen consequences," he said, adding that this conflict will continue to roil commodity markets around the world, affecting oil, gas and wheat prices.

J. P. Morgan

Source: cnnespanol

All news articles on 2022-06-01

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