On June 1, Jamie Dimon, CEO of JPMorgan Chase, warned investors on Wednesday to expect market turmoil in the coming weeks, warning that unprecedented financial conditions could be a “storm” in the economy.
Things like the Russian invasion of Ukraine and the Federal Reserve’s decision to tighten monetary policy due to decades of rising inflation, according to Dimon, the leader of the largest US bank, could provoke market turmoil.
Jamie Dimon said:
“There is a hurricane along the way. Right now, everything looks good, and everyone believes the Fed will be able to deal with this situation. That storm is very close, going our way. We don’t know if it was a modest storm or something like Superstorm Sandy or Andrew. You had better prepare yourself. “
In a process known as “quantitative tightening,” the Federal Reserve will begin selling its nearly $9 trillion of reserves this month. At their meeting later this month, central bank officials are likely to raise interest rates by half.
In order to lower consumer prices to the appropriate levels, the Fed is cutting off the influx of cheap epidemic funds and debt restructuring. However, investors are concerned that the Fed’s aggressive policy move will lead to a recession.
Meanwhile, the Russia-Ukraine conflict has wreaked havoc on the global supply of goods and exacerbated a global energy crisis, resulting in higher gasoline prices for Americans, with oil prices exceeding $100 per barrel.
Dimon’s remarks have revealed that his view of the markets has been very dark since a few weeks ago, when he told analysts on a conference call that he was seeing “storm clouds on the horizon” in the American economy because of unprecedented market conditions.
“I hope those things go well,” Dimon noted at the time. “I hope we get along well and the conflict is over.” “I wouldn’t put my money into everything.”
Dimon has expressed deep fears about the war between Russia and Ukraine and its long-term consequences. He described the brutal attack as a potential “catastrophe” in the global economy that could lead to a recession earlier this month.
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