Jamie Dimon warns Something worse than a recession is coming
Ahead may lie something even worse than a recession, JPMorgan CEO Jamie Dimon recently warned. When he made this remark, he was discussing the state of the American economy. Even Rich Dad Poor Dad author Robert Kiyosaki has warned that a slump could hit the United States. Jamie compares the current state of the United States to ominous storm clouds. Our nation faces numerous challenges, including war, rising interest rates, and diminishing oil supplies.
The CEO of JPMorgan has provided a less-than-optimistic forecast for the state of the American economy in 2022. Jamie acknowledges that businesses and consumers alike are thriving and the economy is in good shape. Nonetheless, there are a number of developments that bear watching. It is unclear what effect these will have on the economy in the not-too-distant future.
Jamie then elaborates on his probability estimates for a mild recession, a hard recession, and a worse recession. The likelihood of each of these scenarios occurring is between 20% and 30%, thus it is impossible to know what will happen next to the U.S. economy.
So, as investors, we need to be ready for anything that may arise. It would be wise to put money away in liquid assets like cash and hard assets like Gold and Bitcoin. While not technically financial advice, many renowned market experts regularly espouse these views.
Although a rise in interest rates helps curb inflation, it can also dampen spending and contribute to a downturn in the economy. Since this is the case, increasing interest rates is not necessarily beneficial. Inflation has been lower than expected as a result of the Federal Reserve’s aggressive rate hikes. As the results were revealed, there was even a rally. Therefore, as this trend continues and inflation falls, a mild to moderate recession is possible. A smooth landing will be challenging to accomplish because of all the external circumstances that the Federal government cannot influence.