JPMorgan Chase CEO Jamie Dimon delivered a stark warning to investors and central bankers on Monday, saying markets are underestimating the economic risks posed by the U.S. deficit, escalating tariffs, and rising global tensions. Speaking at JPMorgan’s annual investor day in New York, Dimon stressed that both Wall Street and policymakers may be too optimistic about their ability to manage looming challenges.
“We have huge deficits; we have what I consider almost complacent central banks,” Dimon told the audience. “You all think they can manage all this. I don’t think they can.”
Dimon emphasized that investors remain too comfortable, having yet to experience the real impact of effective tariffs. “The market came down 10%, [it’s] back up 10%. That’s an extraordinary amount of complacency,” he said. His comments follow a recent move by Moody’s to downgrade the U.S. credit rating, citing concerns over mounting government debt. Investors have been on edge in recent months as President Donald Trump’s trade policies fuel fears of inflation and a slowdown in the U.S. economy.
Dimon also took aim at Wall Street’s earnings forecasts for S&P 500 companies, saying that projections have already dipped since the introduction of new trade policies and are likely to fall even further as uncertainty persists. According to Dimon, current estimates for S&P 500 earnings growth could drop from around 12% at the start of the year to zero within six months, dragging down stock prices and compressing price-to-earnings ratios.
He added that the likelihood of stagflation – a rare combination of recession and inflation – is now roughly double what the market anticipates.
Elsewhere at the meeting, Troy Rohrbaugh, co-head of JPMorgan’s commercial and investment bank, said corporate clients are still largely in a “wait-and-see” mode regarding acquisitions and deals. He predicted a “mid-teens” percentage decline in investment banking revenue for the second quarter compared to last year, though trading revenue is tracking higher by a “mid-to-high” single-digit percentage.
On succession plans, Dimon said there has been no change since last year, when he indicated he would likely remain CEO for less than five more years. “If I’m here for four more years, and maybe two more” as executive chairman, Dimon said, “that’s a long time.”
Among JPMorgan’s executive team, consumer banking chief Marianne Lake stood out during the presentations, speaking for a full hour and reinforcing her position as a leading candidate to eventually succeed Dimon. Chief Operating Officer Jennifer Piepszak, another rumored contender, recently announced she would not pursue the top job.
