Jamie Dimon, CEO of JPMorgan Chase, leaves the U.S. Capitol after a gathering with Republican members of the Senate Banking, Housing and City Affairs Committee on the difficulty of de-banking on Feb. 13, 2025.
Tom Williams | Cq-roll Name, Inc. | Getty Photos
JPMorgan Chase CEO Jamie Dimon mentioned Monday that markets and central bankers underappreciate the dangers created by document U.S. deficits, tariffs and worldwide tensions.
Dimon, the veteran CEO and chairman of the most important U.S. financial institution by property, defined his worldview throughout his financial institution’s annual investor day assembly in New York. He mentioned he believes the dangers of upper inflation and even stagflation aren’t correctly represented by inventory market values, which have staged a comeback from lows in April.
“We have now big deficits; we’ve got what I contemplate nearly complacent central banks,” Dimon mentioned. “You all assume they will handle all this. I do not assume” they will, he mentioned.
“My very own view is folks really feel fairly good as a result of you have not seen efficient tariffs” but, Dimon mentioned. “The market got here down 10%, [it’s] again up 10%; that is a unprecedented quantity of complacency.”
Dimon’s feedback comply with Moody’s score company downgrading the U.S. credit standing on Friday over considerations concerning the authorities’s rising debt burden. Markets have been whipsawed the previous few months over worries that President Donald Trump’s commerce insurance policies will elevate inflation and gradual the world’s largest economic system.
Dimon mentioned Monday that he believed Wall Avenue earnings estimates for S&P 500 firms, which have already declined within the first weeks of Trump’s commerce insurance policies, will fall additional as firms pull or decrease steering amid the uncertainty.
In six months, these projections will fall to 0% earnings development after beginning the 12 months at round 12%, Dimon mentioned. If that had been to occur, shares costs will doubtless fall.
“I believe earnings estimates will come down, which implies PE will come down,” Dimon mentioned, referring to the “value to earnings” ratio tracked intently by inventory market analysts.
The chances of stagflation, “which is principally a recession with inflation,” are roughly double what the market thinks, Dimon added.
Individually, considered one of Dimon’s high deputies mentioned that company shoppers are nonetheless in “wait-and-see” mode in relation to acquisitions and different offers.
Funding banking income is headed for a “mid-teens” share decline within the second quarter in contrast with the year-earlier interval, whereas buying and selling income was trending larger by a “mid-to-high” single digit share, mentioned Troy Rohrbaugh, a co-head of the agency’s business and funding financial institution.
On the ever-present query of Dimon’s timeline handy over the CEO reins to considered one of his deputies, Dimon mentioned that nothing modified from his steering final 12 months, when he mentioned he would doubtless stay for lower than 5 extra years.
“If I am right here for 4 extra years, and possibly two extra” as government chairman, Dimon mentioned, “that is a very long time.”
Of all the chief displays given Monday, shopper banking chief Marianne Lake had the longest talking time at a full hour. She is taken into account a high successor candidate, particularly after Chief Working Officer Jennifer Piepszak mentioned she wouldn’t be in search of the highest job.