America’s top bankers are more worried about the world than a recession

CNN – Some of the best names on Wall Street think a US recession is now likely, if not inevitable. But they have bigger concerns on their minds.

JPMorgan Chase CEO Jamie Dimon said Tuesday that he is more concerned about geopolitics than slowing economic growth in the United States.

“There are a lot of things on the horizon that are bad and could — not necessarily — but could put the United States into recession,” he told a panel at the Future Investment Initiative conference in Riyadh, Saudi Arabia. .

“That’s not the most important thing we think about. We’ll manage that. I want to worry a lot more about the geopolitics of the world today,” he told CNN’s Richard Quest, who moderated the discussion between some of the America’s most influential financier. at the event, also known as “Davos in the desert.”

Dimon said he was referring to Russia’s war in Ukraine and the strained relationship between the United States and China, where leader Xi Jinping has just consolidated his grip on power and sidelined officials who wanted reform. do and open the world’s second largest economy.

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“I was much more concerned about the relationships of the Western world than whether there is a mild recession or a slightly severe recession [in the United States],” he said.

The breakdown of relations — and the negative consequences for everything from national security to energy supply and food security — was a constant theme throughout the discussion.

Ray Dalio, the billionaire founder of the hedge fund Bridgewater, said that “there is a great risk of international war.” What is needed is a “strong political center” that is “stronger than the extremes,” he said.

Commenting on the likelihood of a US recession, Dimon said that while US business and consumer spending remains strong for now, Americans will likely run out of “extra cash” around the middle of next year.

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Goldman Sachs CEO David Solomon, speaking on the same panel, thinks a US recession is also likely.

“There is no question that economic conditions will be meaningfully tighter from here,” Solomon said, referring to interest rate hikes by the Federal Reserve. “If you’re in a situation where inflation is entrenched, it’s very difficult to get out without an economic slowdown,” he said, adding that Europe may already be in recession.

Fix social media

The CEO of Blackstone Group, Stephen Schwarzman, also emphasized rising interest rates and “relationship problems among countries” as the major challenges facing businesses.

He added social media to that list.

“One of the things we’re not nearly aware of is how difficult it is for governments to function in a social media world,” Schwarzman said. Initiatives to try to “make the world a better place” are down to “some minority shouting” people trying to get something done for the good of the world, he said.

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Dimon said social media users should authenticate in the same way that people require authentication to access the banking system, which would help “get rid of bots.”

Social media users should be given an “options menu” for algorithms that explains how each one works. “They should give you a choice instead of manipulating you,” he said.

Asked what kind of algorithm he would choose, Dimon replied: “I don’t look at any of that crap.”

The Future Investment Initiative, which runs until October 27, was launched in 2017 as part of Saudi Arabia’s efforts to attract international investment to reduce its economy’s heavy dependence on oil.

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