JPMorgan Chase CEO Jamie Dimon warned that the “worst outcome” for America’s economy is stagflation, saying it “shouldn’t be taken off the table.” Dimon, 68, made these remarks on Tuesday at the Council of Institutional Investors in New York.
JPMorgan Chase, the largest U.S. bank with $3.4T in assets, warned of the dangers of stagflation—a mix of slow economic growth, rising inflation, and unemployment. According to Investopedia, stagflation, last seen in the 1970s, could lead to a stock market crash and lower retirement savings.
In August, inflation rose less than expected at 2.5%, but the federal debt reached $35.3 trillion as of September 12. Interest payments on the national debt, now exceeding the costs of Medicare and national defense, have surpassed $1 trillion for the first time in U.S. history, potentially contributing to future inflation.
“So, it’s hard to look at [it] and say, ‘Well, no, we’re out of the woods.’ I don’t think so,” said Dimon.
Despite inflation nearing the Fed’s 2% target, a Federal Reserve Bank of New York report shows mixed consumer sentiment. Americans expect their spending to rise by 5% but household incomes to increase by just 0.1%. According to CNBC, JPMorgan CEO Jamie Dimon estimates a 35% chance of stagflation, suggesting a recession is more likely.
JPMorgan chief Jamie Dimon warns US economy faces an outcome worse than a recession https://t.co/4nQATQccyR pic.twitter.com/aO4S0IMSZX
— Daily Mail Online (@MailOnline) September 13, 2024
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