JPMorgan CEO Jamie Dimon slams central bank for ‘100% dead wrong’ economic forecasts – adding it ‘won’t make a difference’ if interest rates go up again
- Dimon said it would have no effect whether or not the Fed raised rates
- His comments came during the Future Investment Initiative conference in Saudi Arabia
- JP Morgan’s CEO suggested geopolitical escalation could cause hardship
The CEO of JP Morgan has said that central banks were 100 percent wrong in their financial forecasts 18 months ago and that there should be less complacency in the coming year.
At a conference of Wall Street leaders in Riyadh, Saudi Arabia, Jamie Dimon said Monday that he had little confidence that central banks would be able to keep the economy in check amid persistent inflation and escalating geopolitical tensions.
He also criticized the size of current government spending and downplayed the importance of decisions made by central banks, including the US Federal Reserve.
“Budget spending is higher than ever before in peacetime and there is an omnipotent feeling that central banks and governments can get through all this,” Dimon said.
JP Morgan CEO Jamie Dimon said 18 months ago that central banks were “100 percent wrong” in their financial forecasts. He is pictured at the Future Investment Initiative conference this week
Dimon also said he thought any Fed changes to benchmark interest rates would likely have “zero” impact
‘I am careful. “I don’t think it makes a big difference if rates go up 25 basis points or more, like zero, none, nada,” he added.
“I would like to point out that the central banks were 100 percent wrong 18 months ago, so perhaps there needs to be some humility in making financial predictions,” Dimon said.
“I would be very careful about what might happen next year.”
Dimon’s comments came during a discussion moderated by Carlyle Group co-founder David Rubenstein at the Future Investment Initiative conference this week.
Also in attendance were David Solomon, CEO of Goldman Sachs, Jane Fraser of JPMorgan and Citi, among other leading bankers and asset managers.
As the US began to emerge from the pandemic, overheated by easy money, Fed Chairman Jerome Powell dismissed inflation, labeling it, among other things, “transitory.”
Fed Chairman Jerome Powell was dismissive of inflation, calling it “transitory.”
When asked what that meant at a press conference in July 2021, he said: “It means that the price increases will happen, so there will be inflation, but the inflation process will stop.”
In March 2022, Fed officials predicted that the benchmark interest rate would likely rise to around 2.8 percent by the end of 2023.
This currently stands at 5.25 percent and could rise further before the end of the year.
On the same panel, Bridgewater Ray Dalio was also cynical, noting that his outlook for the global economy in 2024 was “pessimistic.” He also mentioned the debt burden and the conflict.