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Jamie Dimon Warns Of A ‘Hurricane’ Coming Our Way—Here’s What You Need To Know

Jack Kelly

Senior Contributor

I write actionable interview, career and salary advice.

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Jun 2, 2022,03:37pm EDT

Photographer: Chris Ratcliffe/Bloomberg

Jamie Dimon, the CEO of JPMorgan and one of the most respected Wall Street leaders, gave a stern warning to investors. He advised people to prepare for an upcoming economic “hurricane.”

At an investor conference on Wednesday, Dimon said, “That hurricane is right out there down the road coming our way.” The chief executive added, “We don’t know if it’s a minor one or Superstorm Sandy. You better brace yourself.”

Dimon alluded to Hurricane Sandy, a storm National Geographic referred to as a “raging freak of nature.” The hurricane took a big toll, creating destruction, knocking out power for many families and closing down businesses for an extended period of time, spanning the Caribbean to the United States East Coast.

This isn’t what you want to hear from an experienced, sober, serious-minded executive who has seen his fair share of booms and busts over the many decades working in banking and finance. The causes of concern include the Federal Reserve Bank and the government discontinuing their financial stimulus programs started during the pandemic to keep the economy afloat. Instead, the Fed will enact a quantitative tightening program.

This new policy is the nearly direct opposite of what the bank did during the pandemic. Now, Americans will see a contractionary monetary policy that will decrease the amount of liquidity within the economy. The policy is the reverse of quantitative easing, which aimed to increase money supply, in order to stimulate the economy.

Additionally, Dimon has some concerns over the possible escalation of war emanating from Russia’s invasion of Ukraine, rapidly rising inflation and the related increase in costs, along with other uncertainties.

For the last couple of years, it was all about exuberance. Money flowed freely with interest rates held artificially low. As a consequence, the U.S. saw real estate, the stock market and cryptocurrency prices skyrocket higher.

Jamie Dimon Warns Of A ‘Hurricane’ Coming Our Way—Here’s What You Need To Know (forbes.com)