JPMorgan CEO Jamie Dimon is warning that the chances of a US stock market fall are far greater than many Wall Streeters believe.
The head of America’s largest bank says he is “far more worried than others” about a stock market correction — widely defined as a drop of at least 10% — predicting that could come in the next six months to two years.
“I would give it a higher probability than I think is probably priced in the market and by others,” Dimon told the BBC. “So if the market’s pricing in 10%, I would say it is more like 30%.”
The banking veteran said there were a “lot of things out there” creating an atmosphere of uncertainty, citing geopolitical tensions, fiscal spending and governments around the world becoming more bellicose.
“People talk about stockpiling things like crypto. I always say we should be stockpiling bullets, guns, and bombs,” Dimon said. “The world’s a much more dangerous place, and I’d rather have safety than not.”
Earlier this year, the banker warned the US would run out of missiles in seven days if war breaks out in the South China Sea — part of a recent shift in his focus to global security — the BBC noted.
“All these things cause a lot of issues that we don’t know how to answer,” he said. “So I say the level of uncertainty should be higher in most people’s minds than what I would call normal.”
The long-serving chief executive warned that there were still some risks from inflation, insisting the full effects of President Trump’s tariffs are yet to be felt.
Dimon’s comments come after Kristalina Georgieva, the managing director of the International Monetary Fund, told an audience at the Milken Institute in Washington, DC, to “buckle up.”
“Uncertainty is the new normal,” the Bulgarian economist said Wednesday. “Before anyone heaves a big sigh of relief, please hear this: global resilience has not yet been fully tested. And there are worrying signs the test may come.”
Experts at the Bank of England warned earlier this week that they saw a growing risk of a “sudden correction” in global markets amid soaring valuations of leading AI tech companies.
“Equity market valuations appear stretched, particularly for technology companies focused on artificial intelligence,” Britain’s central bankers wrote. “This leaves equity markets particularly exposed should expectations around the impact of AI become less optimistic.”
Dimon appeared to agree with that assessment, telling the BBC that some of the money invested in AI would “probably be lost.”
“The way I look at it is AI is real; AI in total will pay off – just like cars in total paid off, and TVs in total paid off, but most people involved in them didn’t do well,” he said.
