JPMorgan CEO warns Wall Street to brace for recession
OAN’s James Meyers
2:45 PM – Thursday, November 30, 2023
JPMorgan CEO Jamie Dimon emphasizes the need for Wall Street to be better prepared for a potential recession.
He sounded the alarm on the real possibility of a recession saying, “A lot of things out there are dangerous and inflationary. Be prepared.” Dimon said this while at the New York Times DealBook Summit in New York on Wednesday.
“Interest rates may go up and that might lead to recession,” he added, according to CNN Business.
The remarks come after Federal Reserve officials have decided to keep the benchmark federal funds rate between 5.25% and 5.5%, which is a 22-year high.
Economists have also been divided on what the next move is for the economy and whether or not it means the economy will have a soft landing or hard landing.
“I’m cautious about the economy,” Dimon said, per CNN.
Meanwhile, the Bureau of Labor Statistics reported in October that the U.S. economy added 150,000 positions, which is a sign that an interest rate cut is on the horizon.
Currently, the unemployment rate is at 3.9%, which is above the Fed’s 3.8% year end-forecast.
In June 2022, inflation was at a staggering 9.1% and rates have continued to increase.
During an interview with Bloomberg TV in October, Dimon claimed that interest rates will hike up to a high 7%, which would make it the highest rate since 1990.
Hedge fund expert Bill Ackman said earlier in the week that the Federal Reserve needs to cut interest rates as soon as the first quarter to dodge “a real risk of a hard landing” for the U.S. economy.
“What’s happening is the real rate of interest, which is what impacts the economy, keeps increasing as inflation declines,” said the Pershing Square Capital Management founder.
“I think there’s a real risk of a hard landing if the Fed doesn’t start cutting rates pretty soon,” Ackman added, per Bloomberg, noting that he’s seen evidence of a weakening economy.
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What steps should investors and financial institutions take to better prepare for a potential recession, according to Jamie Dimon and other experts
JPMorgan CEO Jamie Dimon Highlights the Need to Prepare for a Potential Recession
During the New York Times DealBook Summit on Wednesday, JPMorgan CEO Jamie Dimon emphasized the importance of Wall Street being better prepared for a potential recession. Dimon sounded the alarm on the real possibility of a recession, stating, ”A lot of things out there are dangerous and inflationary. Be prepared.” His warning comes at a time when there is uncertainty regarding the direction of the economy.
Dimon’s concerns about a potential recession are not unfounded. The remarks follow the Federal Reserve’s decision to maintain the benchmark federal funds rate at a 22-year high, between 5.25% and 5.5%. This decision has sparked a debate among economists regarding the next move for the economy and whether it will result in a soft landing or a hard landing.
“I’m cautious about the economy,” Dimon said, echoing the concerns shared by many experts. The Bureau of Labor Statistics reported in October that the U.S. economy added 150,000 positions, indicating that an interest rate cut may be on the horizon. However, the current unemployment rate of 3.9% is above the Federal Reserve’s year-end forecast of 3.8%.
Inflation has also been a cause for concern. In June 2022, inflation reached a staggering 9.1% and has continued to increase since then. Dimon predicted that interest rates could rise to as high as 7%, the highest rate since 1990. This would have significant implications for the economy.
Hedge fund expert Bill Ackman also shared his concerns about the economy, calling for the Federal Reserve to cut interest rates as soon as the first quarter to avoid a hard landing. Ackman highlighted the increasing real rate of interest, which impacts the economy, as inflation declines. He warned of the risk of a hard landing if the Fed does not take action soon, citing evidence of a weakening economy.
In conclusion, Jamie Dimon’s warning about the possibility of a recession and the need for better preparation should be taken seriously. With concerns about inflation, interest rates, and the overall state of the economy, it is crucial for investors and financial institutions to be proactive in their risk management strategies. Only through careful planning and adequate preparation can we mitigate the potential impact of a recession and ensure the stability of our financial markets.
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