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JP Morgan Boss Says Global Risks Could “Eclipse Anything Since World War II”

By Hugh Fort in US business news, posted April 9, 2024

JP Morgan boss Jamie Dimon says the current global situation is one of the gravest threats since World War II, with potentially severe impacts on life and economic progress.

In his yearly message to shareholders, Jamie Dimon said the global landscape was once moving towards greater strength and safety.

However, the CEO said that took a significant hit with Russia's invasion of Ukraine in February 2022.

He said: “When terrible events happen, we tend to overestimate the effect they will have on the global economy.”

“Recent events, however, may very well be creating risks that could eclipse anything since World War II – we should not take them lightly."

He wrote about the “abhorrent attack on Israel and ongoing violence in the Middle East” as critical contributors to the precarious current moment, which challenges many assumptions about future global security.

“Recent events may very well be creating risks that could eclipse anything since World War II – we should not take them lightly"

The letter covered topics like politics, artificial intelligence, and interest rates.

It pointed out the unpredictability of international relations' impact on the global economy, which could be negligible or decisive.

He stressed the escalation of conflicts in Ukraine and the Middle East could worsen.

He also highlighted the shadow of nuclear threats as the foremost danger, necessitating a strong military commitment.

Echoing the International Monetary Fund's (IMF) warnings in December, he said the global economy faces risks of a new cold war that could undo progress since the Soviet Union's dissolution.

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Gita Gopinath from the IMF described the current state as a pivotal “turning point."

She said the escalating tensions between major powers and the threat of economic fragmentation, particularly between the US and China, could potentially erase trillions in global output.

Dimon also warned of inflationary pressures and interest rate fluctuations due to increased government spending on military, climate initiatives, healthcare, and supply chain adjustments.

He said JP Morgan has prepared for US interest rates to potentially soar above eight percent or drop as low as two percent.

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