Dimon says hard landing still possible

JPMorgan Chase Chairman and CEO Jamie Dimon said there is still a chance the U.S. economy will have a hard landing.

In an interview Asked by CNBC’s Sri Jegarajah about the possibility of an economic hard landing at the JPMorgan Global China Summit in Shanghai, Dimon said “of course” there could be a hard landing in the US, but “if we’ve studied history, can we say that’s not a possibility?”

He said the worst outcome for the U.S. economy would be a “stagflation” scenario, where inflation is still rising but high unemployment slows growth.

“When you look at the range of outcomes, the worst outcome for all of us is what we call stagflation, rising interest rates and a recession. That means lower corporate profits, but we’ll get through all of that,” Dimon said. “I mean, the world got through it, but I think the chances of that were higher than other people thought.”

Dimon pointed to Americans’ fatigue with inflation, saying most Americans would be “pretty well off” even if the country fell into a recession.

“But their confidence level is low. And that seems to be primarily due to inflation… so they seem to be OK,” he said, noting that relief money from the COVID-19 pandemic may have helped. .

“That doesn’t mean there won’t be problems next year,” he acknowledged. “It’s just that it looks pretty good at this point.”

The International Monetary Fund in January upgraded its outlook for the global economy, citing resilient growth since the pandemic and slowing inflation, saying a hard landing was likely to be avoided.