2024 is looking a whole lot like the 1970s, says Jamie Dimon — and that's not a good thing
AP Images/Jacquelyn Martin
- JPMorgan Chase CEO Jamie Dimon told Fox Business Network he sees similarities between the economy of the 1970s and 2024.
- Dimon said he isn't sure the economy will achieve the soft landing the Fed is trying to engineer.
- The 1970s was marked by a period of high inflation and stagnant economic growth.
JPMorgan Chase CEO Jamie Dimon said 2024 may just be like the 1970s — and it's more about the economy than nostalgia.
On Tuesday, Dimon listed out some common developments between the two eras to Fox Business Network's Maria Bartiromo. Those include large fiscal deficits, changing trade flows, and commitment to huge government spending — this time for infrastructure and the Inflation Reduction Act. Those developments, he said, are "all inflationary."
"And that looks a little more like the 1970s to me," Dimon told Bartiromo, referring to a period when stagnant growth and high inflation pressured the economy.
Dimon's concerns stand in contrast to some economists' optimistic market expectations of a soft landing after inflation cooled from a four-decade high in June 2022 following relentless interest rate hikes by the Federal Reserve. The Fed has held rates steady since July and signaled three rate cuts this year.
But the JPMorgan boss isn't sure the economy will see the soft landing.
"Obviously, all of us in business have known how to deal with the ups and downs of vicissitudes of the economy. But I do think the crosscurrents are pretty high," said Dimon, citing several concerns including COVID-19 stimulus money running out soon and still-high interest rates.
"I'm a little skeptical of this kind of 'Goldilocks' kind of scenario," he said, referring to an economy that is neither too hot nor too cold.
Dimon warned that a recession may still be on the way as it takes time for the effects of the Fed's rate hikes to show up in the economy.
"I think they did the right thing to raise rates. I think it was a little late, and I think they're doing the right thing just to wait and see what happens," he said. "But all of those factors may very well push us to recession, as opposed to a soft landing."