Jamie Dimon walks back economic hurricane forecast: ‘Hit by a bit of a storm already’
Ryan King
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JPMorgan Chase CEO Jamie Dimon walked back his warning of an economic “hurricane,” softening his diagnosis on the state of the economy.
Dimon said he was attempting to underscore the grave risks to the economy, but explained that he was not seeking to predict whether the economic “hurricane” on the horizon would ultimately manifest and contended that he should not have used that word.
JAMIE DIMON WARNS OF ECONOMIC ‘HURRICANE’
“I shouldn’t [have] ever used the word hurricane, but I said … there were storm clouds which may mitigate,” Dimon told Fox Business on Tuesday. “And people say, ‘he doesn’t think it’s a big deal.’ And I said, ‘No, those storm clouds could be a hurricane.’”
Dimon, a prominent voice in the world of finance, stressed the economic risks could “be nothing” or “could be bad.” He contended that the United States was “hit by a bit of a storm already” and should be prepared for both outcomes. Back in June, Dimon spooked investors when he issued the hurricane warning.
“You know, I said there’s storm clouds, but I’m going to change it … it’s a hurricane,” Dimon declared in June, noting that while economic conditions appeared “fine” at the time, there was uncertainty whether the hurricane would be “a minor one or Superstorm Sandy.”
Despite walking back the “hurricane” description, the billionaire CEO surmised that there are heightened risks to the economy, ranging from geopolitical events to policies at the Federal Reserve.
“It’s heightened because of Russia, Ukraine, oil, energy, food, quantitative tightening. Is it going to be enough to raise rates to 5%? And this is having a huge effect on smaller countries, poor nations, those who are reliant on importing oil and gas,” he said.
Unemployment for December ticked down to 3.5%, one of the lowest rates since the 1960s, and while inflation continues to ravage the economy, there are signs it is beginning to abate. Some economists fear that the Fed has been too aggressive against inflation by raising interest rates too sharply, risking a recession. Third-quarter GDP growth last year clocked in around 3.2% after being revised upward.
One silver lining for Dimon is that the “consumer is still strong.”
“Their balance sheets are in good shape. They’re spending 10% more than pre-COVID. They have more in their checking account, companies are in good shape, that’s driving a strong economy,” the CEO said.
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Host Maria Bartiromo pressed Dimon, who has been outspoken about public policy, about whether he would vie for the presidency in 2024. He said that he is “not running for president,” but demurred on questions about whether he thinks he could defeat former President Donald Trump or had plans to back a candidate. Dimon also indicated he would not vie to succeed Treasury Secretary Janet Yellen should she step down from her post.
https://twitter.com/MariaBartiromo/status/1612818564024508416
“I’m the type that whether it’s a Democrat or Republican, I want them both to succeed. But we need very competent policy, which we have not always had. If we do those things right, we’re gonna go with 3% [annual GDP growth] and that also then pays for a better safety net for people, a stronger military, and makes America wealthier,” Dimon said.