JP Morgan Chase’s CEO has a bleak warning on Trumps rates
In his annual letter to the shareholders, the chief of the largest bank of Wall Street said that a recession is a serious possibility after the aggressive import taxes that Trump attacked China, the European Union and dozens of other countries whose products help maintain affordable US consumer goods.
“Recent tariffs will probably increase inflation and are causing many to consider a greater probability of a recession,” Dimon wrote, one of the most influential figures in the financial services space. “And even with the recent decrease in market values, prices are still relatively high. These significant forces and something unprecedented make us remain very cautious.”
Trump can have some legitimate reasons to impose tariffs, Dimon continued, but in the short term, we are likely to see inflationary results, not only in imported goods but also in national prices, as the costs of inputs and increases in demand in national products increase. ”
Bloomberg through Getty Images
Tariffs have possible reprisals from other countries, Dimon wrote, who said that “their most serious concern is how this will affect the long -term economic alliances of the United States.”
“America First is fine,” Dimon wrote, echoing one of Trump’s meeting screams, “as long as he doesn’t end up being America alone.”
These potential impacts on the economy would also increase interest rates, he said.
“All these crossed currents and turbulence may take years to develop,” he said. “It is almost impossible to put them with confidence in a quarterly or even annual forecast.”
Dimon’s letter arrives a day after the multimillionaire coverage fund manager Bill Ackman issued a similar warning about the tariffs Trump announced last week, writing on social networks that it is similar to launching “economic nuclear war war in all countries of the world.” If Trump does not stop planned tariffs to allow some negotiations about them, “we go to an economical and induced nuclear winter, and we should begin to accumulate,” Ackman wrote.
“[W]E are in the process of destroying confidence in our country as a commercial partner, as a place to do business and as a market to invest capital, ”Ackman added.
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Despite the actions sinking, Trump has ruled out concerns. When a journalist asked him Sunday night how much he would let the stock market withstand, he replied: “I think your question is so stupid. I mean, I don’t want anything to fall, but sometimes you have to take medications to fix something.”
Then, the president added: “I don’t think inflation is a big problem.”