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JPMorgan Chase CEO Jamie Dimon says the U.S. banking disaster is just not over and “there shall be repercussions from it for years to come back.” The manager added that latest financial institution failures “have considerably modified the market’s expectations,” and the chances 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 considerations concerning the U.S. financial 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 is just not but over, and even when it’s behind us, there shall be repercussions from it for years to come back.
“Current occasions are nothing like what occurred in the course of the 2008 world monetary disaster (which barely affected regional banks),” the JPMorgan boss defined. “At the moment, there was monumental 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 must be resolved.”
Commenting on the Federal Reserve’s efforts to curb inflation and future take hikes, Dimon opined:
If we have now greater inflation for longer, the Fed could also be compelled to extend charges greater than folks count on regardless of the latest financial institution disaster.
As well as, he cautioned that quantitative tightening (QT) “might have ongoing impacts which may, over time, be one other pressure, pushing longer-term charges greater than at the moment envisioned. This will likely happen even when we have now a light — or not-so-mild — recession, as we noticed within the Nineteen Seventies and 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 financial system is “fairly good” however reiterated that there are “storm clouds forward.”
What do you concentrate on JPMorgan CEO Jamie Dimon’s view of the financial system and the banking disaster? Tell us within the feedback part under.
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