JPMorgan CEO Jamie Dimon Warns Recession Could Hit in 6 Months, Stock Market Could Drop 20% More — ‘This Is Serious Stuff’

The CEO of world funding financial institution JPMorgan, Jamie Dimon, has warned that the U.S. economic system might tip into recession in six to 9 months. “This is severe stuff,” the chief burdened, including that the inventory market might simply fall one other 20%.

JPMorgan CEO Jamie Dimon’s Warnings

JPMorgan CEO Jamie Dimon shared his warnings in regards to the U.S. economic system and the inventory market in an interview with CNBC Monday on the JPM Techstars convention in London.

Dimon cited quite a few indicators that would push the U.S. economic system into recession, together with runaway inflation, rates of interest rising greater than anticipated, the results of quantitative easing, and the Russia-Ukraine conflict. Stating that “Europe is already in recession,” the JPMorgan boss mentioned:

These are very, very severe issues which I believe are prone to push the U.S. and the world … in some type of recession six to 9 months from now.

The government famous that the Federal Reserve is “clearly catching up” as inflation reached a 40-year high, emphasizing that the central financial institution “waited too lengthy and did too little.” Dimon opined: “And, you already know, from right here, let’s all want him [Fed’s chairman] success and hold our fingers crossed that they managed to decelerate the economic system sufficient in order that no matter it’s, is delicate — and it’s doable.”

Nonetheless, he believes that the U.S. economic system is “really nonetheless doing effectively,” including that buyers are prone to be in higher form than in the course of the 2008 international monetary disaster. However, he cautioned:

But you possibly can’t discuss in regards to the economic system with out speaking about stuff sooner or later — and that is severe stuff.

Responding to a query about how lengthy the U.S. economic system will doubtless be in recession, he admitted that he couldn’t make certain, advising market members to evaluate a variety of outcomes. “It can go from very delicate to fairly exhausting and rather a lot might be reliant on what occurs with this conflict. So, I believe to guess is difficult, be ready,” the JPMorgan chief acknowledged.

Dimon was additionally requested in regards to the outlook for the S&P 500. He burdened that the markets might be unstable and the benchmark might fall farther from present ranges. “It might have a methods to go. It actually will depend on that soft-landing, hard-landing factor and since I don’t know the reply to that, it’s exhausting to reply … it might be one other simple 20%,” the JPMorgan government replied, elaborating:

The subsequent 20% can be rather more painful than the primary.

“Rates going up one other 100 foundation factors might be much more painful than the primary 100 as a result of folks aren’t used to it, and I believe unfavorable charges — when all is alleged and performed — could have been an entire failure,” he concluded. At the time of writing, the S&P 500 has already dropped 25% year-to-date.

In June, Dimon warned that an financial hurricane was coming, advising folks to brace themselves. In August, the JPMorgan boss doubled down on his warning, cautioning that “one thing worse” than a recession might be coming.

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