Jamie Dimon Says Fed Action, Russia-Ukraine War Leading To Economic 'Hurricane'

JPMorgan Chase & Co JPM CEO Jamie Dimon had a sobering message for investors on Wednesday, warning of an economic “hurricane” on the horizon.

What Happened: Dimon was speaking at a conference sponsored by AllianceBernstein Holding when he made the prognostication, saying the hurricane is “right out there down the road coming our way.”

“You’d better brace yourself,” he told the attendees of the financial conference. Even though the markets have seen a dramatic downturn since the end of 2021, Dimon said that thing may get worse, describing the current environment as “kind of sunny, things are doing fine, everyone thinks the Fed can handle this.”

Dimon said he’s buckling down the hatches at the country’s biggest bank, noting that at J.P. Morgan, “we’re going to be very conservative with our balance sheet.”

Also Read: US Consumer Confidence Is Falling: What It Means For Investors

The Reasons To Be Concerned: Dimon said that the primary factor that may lead to further downside for the markets are the steps the Fed will be taking in the coming months, including reducing its bondholding by $95 billion a month.

“We’ve never had QT [quantitative tightening] like this, so you’re looking at something you could be writing history books on for 50 years,” he said. Dimon also acknowledged the central bank must proceed with the policy to “remove some of the liquidity to stop the speculation, reduce home prices and stuff like that.”

Dimon also noted the Russia-Ukraine War and the impact the conflict is having on the price of oil. He said more needs to be done “to protect Europe from what’s going to happen to oil in the short run.”

He added an optimistic point during his hour-long conversion, saying that while the immediate future looks grim, there are “bright clouds” for the economy in the form of rising wages and plenty of job openings.

Photo: Courtesy of Steve Jurvetson on Flickr.