JPMorgan CEO Dimon Warns of Signs Similar to Pre-Financial Crisis

Warning at annual event: “Economic cycle is approaching an inflection point”

Jamie Dimon, CEO of JPMorgan Chase, the largest bank in the United States, has warned that signs similar to those seen before the 2008 financial crisis have begun to appear.

At JPMorgan’s annual event held on the 23rd (local time), Dimon was asked about competition in the financial industry and said, “Unfortunately, we witnessed the same phenomenon from 2005 to 2007. A rising tide lifted all boats, and everyone was making a lot of money.”

On January 21, Dimon Jamie, chief executive officer of JPMorgan Chase, is speaking at the 56th annual meeting of the World Economic Forum (WEF) held in Davos, Switzerland. Yonhap News.

He particularly pointed out that the currently booming markets are fueling excessive optimism. Dimon said, “People are now reassured that high asset prices and trading volumes will continue and that there will be no problems,” adding, “But eventually the economic cycle reaches an inflection point.”

He went on to say, “When that time comes, there will be a wave of borrower defaults that will affect lenders across the board, and even industries that no one expected will be hit.”

He stressed that JPMorgan is not trying to take on additional risky loans just to increase its net interest income (NII), but added, “You can see some people doing foolish things. They are doing stupid things to generate returns.”

He also issued a warning about the recent stock market rally driven by artificial intelligence (AI). Dimon said, “In the credit cycle, there are always unexpected events,” and noted, “The key has always been which industry would be hit. This time, because of AI, the software industry could be the one.”

The financial industry itself is also facing the possibility of restructuring as AI spreads. However, Dimon predicted that JPMorgan would be a net beneficiary overall. He said, “Out of 100 areas, we will be the winner in 75 and the loser in 25,” expressing confidence that even if there are losses in some lines of business, the bank will maintain its overall competitive edge.

Meanwhile, in a subsequent Q&A session, when asked about his own future plans, he said that he would remain as JPMorgan CEO “for a few more years,” and that he could then stay on “for a few more years” as chairman after that.