CNBC headlineJamie Dimon says ‘brace yourself’ for an economic hurricane caused by the Fed and Ukraine war
PUBLISHED WED, JUN 1 202210:27 AM EDTUPDATED WED, JUN 1 20228:20 PM EDT
* There are two main factors that has Dimon worried: So-called quantitative tightening, or QT, is scheduled to begin this month and will ramp up to $95 billion a month in reduced bond holdings.
* The other large factor worrying Dimon is the Ukraine war and its impact on commodities, including food and fuel. Oil could hit $150 or $175 a barrel, he said.
* “You’d better brace yourself,” Dimon told the roomful of analysts and investors. “JPMorgan is bracing ourselves and we’re going to be very conservative with our balance sheet.”
Last week, during an investor conference for his bank, Dimon referred to his economic concerns as “storm clouds” that could dissipate. Presentations from Dimon and his deputies at the all-day meeting have bolstered JPMorgan shares by giving greater detail on investments and updated figures on interest revenue.
But his concerns seem to have deepened since then.
During the response to the 2008 financial crisis, central banks, commercial banks and foreign exchange trading firms were the three major buyers of U.S. Treasurys, Dimon said Wednesday. The players won’t have the capacity or desire to soak up as many U.S. bonds this time, he warned.