Home Latest News JPMorgan chief paints bleak picture of world economy amid geopolitical tensions

JPMorgan chief paints bleak picture of world economy amid geopolitical tensions

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JPMorgan chief paints bleak picture of world economy amid geopolitical tensions

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This still, taken from a video released on July 12, 2023, shows JPMorgan CEO Jamie Dimon speaking in an interview. — YouTube/The Economist
This still, taken from a video released on July 12, 2023, shows JPMorgan CEO Jamie Dimon speaking in an interview. — YouTube/The Economist

JPMorgan CEO Jamie Dimon has said that the ongoing Russia-Ukraine war and the Israel-Hamas violence in the Middle East could have adverse impacts on the global economy the world was already reeling from Covid-19’s shocks to the financial system across the board.

Jamie Dimon was of the view that the relative health of the US economy, the country has a number of challenges, including a tight labour market, high government debt levels, fears of burgeoning inflation and the longer-term consequences of quantitative tightening.

Nonetheless, the worsening geopolitical conditions could make the situation infinitely more difficult, the banker warned.

“The war in Ukraine compounded by last week’s attacks on Israel may have far-reaching impacts on energy and food markets, global trade, and geopolitical relationships. This may be the most dangerous time the world has seen in decades,” he stated in a quarterly report published Friday.

People pass the JPMorgan Chase headquarters building on May 26, 2023, in New York City. — AFP
People pass the JPMorgan Chase headquarters building on May 26, 2023, in New York City. — AFP

American bank executives are “climbing the wall of worry,” Dimon told CNN pointing to a fact prevalent in Wall Street explaining how markets can seek gains despite instability and crises in the global arena.

“We do a hundred stress tests a week… Usually, geopolitics presents itself as a deep recession or a mild recession… And markets doing well is not a reason ever to say they will continue to do well,” the JPMorgan chief stated.

In an earlier warning, founder of Bridgewater Associates Ray Dalio stated that the Israel-Palestine conflict may spread beyond the borders of the two countries, and have far-reaching consequences for the entire global community.

“In my opinion, this war has a high risk of leading to several other conflicts of different types in a number of places, and it is likely to have harmful effects that will extend beyond those in Israel and Gaza,” Dalio wrote in a LinkedIn post Thursday.

“The Israel-Hamas war is another classic, unfortunate step toward a more violent and encompassing international war,” he maintained.

Since the unprecedented attack —launched due to continued Israeli brutality on innocent civilians for decades — by Hamas, thousands of lives were claimed leaving another thousand injured.

The violence in the region has forced global oil prices to climb. 

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