On Tuesday, JPMorgan Chase CEO Jamie Dimon cautioned against forming any steadfast predictions about the economy. Dimon, the head of the largest bank in the U.S. by assets, stated while in Saudi Arabia that one should always be readying for different possibilities and chances, rather than only one course of action - a lesson he has witnessed firsthand. Additionally, he maintained that it doesn't matter if the Federal Reserve raises rates by another quarter point.
On Tuesday, JPMorgan Chase CEO Jamie Dimon issued a warning about the risks of predicting the trajectory of the economy, particularly in light of the Federal Reserve and other central banks' tendency to misjudge it in recent years. At an event in Riyadh, Saudi Arabia, Dimon argued against the idea of anyone trying to decide which "course of action" will be taken, adding, “I've never seen anyone call it." He then referenced the Fed's outlook from early 2022, which grossly underestimated key interest rates and core inflation, and remarked, “I want to point out the central banks 18 months ago were 100% dead wrong."
Dimon went on to caution against the notion of central banks and governments having the capacity to manage economic conditions, noting that Wall Street should not make too much of any potential short-term rate hikes of 25 basis points or more. He warned that this is “may be the most dangerous time the world has seen in decades," and that one should be prepared for the possibility of the fed funds rates rising as high as 7%. In addition, Dimon criticized the lack of a coordinated strategy in the government's pursuit of environment, social, and governance (ESG) objectives, saying, “You can't build pipelines to reduce coal emissions. You can't get the permits to build solar and wind and things like that. So we better get our act together."
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