JP Morgan’s Bitcoin Hater Jamie Dimon Doesn’t See A Recession On The Horizon
JP Morgan Chase’s CEO Jamie Dimon thinks that the markets from equities to high-yield bonds that have been flashing warning signs are probably an overreaction to slowing growth rather than a precursor of imminent recession.
“Credit spreads were abnormally low for a long time. This is more – maybe a little bit of normalization, and… you and I both know that… the tip of the spear is IPOs and high yield… when sentiment changes dramatically, those are usually the first two areas where people cut back. And then they kind of open up over time,”
He thinks that the 250 trillion dollars debt across the globe is way too much and in the debt in the US is too high. Although the US economy might be in a slowdown period, it is still growing at a 2-2.5%. Even the December job report showed positive signs. Despite uncertainty from the Federal Reserve on rate hikes and geopolitical risks, such as the U.S. trade war with China creating a volatile market environment, there is no recession on the horizon in the near term.
Mr. Dimon has traditionally not a big fan of cryptocurrencies. He was quoted in calling Bitcoin a “fraud” during a meeting for investors, and he even told employees for the company that they would lose their job for getting involved in trading the token.
Although both Dimon and his company softened their stance on cryptos with an internal report filed at JPMorgan, the company directly called the world of cryptocurrency the
“face of the innovative maelstrom around the blockchain technology.”
Although not everyone has the same opinion as of the JP Morgan’s CEO about the current state of stock markets. Gluskin Sheff's David Rosenberg has little doubt growth will turn negative in 2019 as the stock market flounders. Rosenberg predicted in November on the program that the historic bull run was cracking. However, he was uncertain whether it would cause an outright recession.
“We've got more than 80 percent chance of recession just based on the fact the Fed is tightening policy. This tightening of financial conditions that we've seen in the markets is going to end up having a cascading effect on the economy for the first few quarters of this year,”
he said to CNBC earlier this week.