“I think there’s a chance you’ll have stagflation,” Jamie Dimon, the JPMorgan head, told Bloomberg on Thursday.
The CEO of America’s largest bank is taking proactive measures to prepare for a variety of economic scenarios, including those that experts believe could be more severe than a recession.
Dimon expressed to Bloomberg on Thursday his sincere belief that stagflation—a troubling mix of high inflation and low growth—remains a possibility for the US economy.
“I think there’s a chance you’ll have stagflation,” Dimon warned. He added that it wasn’t a prediction, but insisted we should be prepared.
“I think global fiscal deficits are inflationary. I think the remilitarization of the world is inflationary. The restructuring of trade is inflationary,” he said, adding that the sharp decline in oil prices could be a deflationary offset.
Dimon’s recent economic warnings contribute to his series of pessimistic forecasts regarding the economy in recent weeks. This occurs despite numerous leading banks and commentators revising their perspectives in light of the recent advancements in US-China trade negotiations.
He said last week that a recession was still on the table and predicted that tariff-related volatility would continue to pressure markets.
“I think it’s a mistake to think we can go through all the things we’re going through and the volatility itself will come down,” he said.
Jamie Dimon’s warning is clear: while a recession remains a possibility, the U.S. economy could face a more complex and damaging scenario in the form of stagflation. He urges policymakers, investors, and businesses not to be complacent and to prepare for a range of challenging outcomes as geopolitical, fiscal, and inflationary pressures mount
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