Jamie Dimon is an American banker. Currently, he is the CEO of JP Morgan, the largest bank in the United States and the largest in the world in terms of market capitalization. It is well known that Jamie Dimon does not mince words. In fact, it could be said that it is his personal brand. It is not uncommon for his comments to generate controversy. We are talking about one of those subjects who often speaks without a filter. In many cases, his spontaneity is hilarious. In other cases, he says something that he soon has to take back.
Now, it is important to note the difference between Jamie Dimon (the person) and JP Morgan (the bank). I mean, Jamie Dimon (the person), gives personal opinions all the time. These opinions may or may not represent the official positions of JP Morgan.. For example. In 2018, the topic of Bitcoin was coming up all the time in interviews and conferences. In his characteristic tone, Jamie expressed his reservations about the future of Bitcoin, mainly citing regulatory hurdles in the future. The idea goes something like this: In the future, as Bitcoin gets too big, surely governments (using their legislative power) will stop its progress as an alternative or parallel currency. And the thing goes on. This will surely be done to ensure the integrity of legal tender currencies and the stability of the entire monetary system. Skepticism on Dimon’s part stems from that assumption.
In particular, I always read the reports and the letters to the shareholders of JP Morgan. The regulatory issue is a constant. Reading those documents, on a frequent basis, you can feel the weight of the regulation. And you feel (reading between the lines) the complaint. Which is not uncommon for regulatory banks to have lost quite a bit of pie to non-banks. In this context, it does not seem very strange to me that a bank sees (excessive) regulation as a weight factor.
JP Morgan (The bank) now has analysts and staff working on Bitcoin and cryptocurrencies. I mean, JP Morgan is already in the crypto business in different ways. Dimon has softened his stance since 2018. But his skepticism remains. Of course, Dimon himself has acknowledged that his comments about Bitcoin have met resistance in his own circle. Not everyone within JP Morgan thinks the same way. So, it is best to listen to the specialists of the department in charge. Jamie Dimon’s views, on matters beyond his role as CEO, should be taken as Jamie Dimon’s personal views.
A bank is like a market. It offers many products and services to many customers. If the market owner or manager does not personally like a specific product, the fact that the product is still being sold at the market does not necessarily suggest a contradiction. We must remember that the business of a bank is basically to make money. So if the product has customers, the product is sold, period. Personal opinions take a backseat. yesIf the product presents some risks, the warning is issued. But the final decision rests with the customer.
The habit of making a fuss every time someone says something negative about Bitcoin reveals the immaturity and fanaticism of many in the crypto space. There is everything in the vineyard of the Lord. Some drink beer and others drink wine. It’s not the end of the world. Jamie Dimon is not an “enemy” of Bitcoin for expressing skepticism of it. This is an emerging market in its early stage. We cannot expect everyone to become a passionate bitcoiner overnight. The normal thing is the plurality of opinions. Those totalitarian aspirations on the part of some bitcoiners directly contradict the liberating spirit of the movement. Bitcoin must be an option. And their adaptation must be voluntary. Otherwise, we would be talking about an annoying imposition.
What does Jamie Dimon tell us about the economy? It is true that in terms of credit we are not like in the 2007-2008 period. Banks are in better shape due to better capitalization. And, on the other hand, there is more money in people’s pockets. Our problems now are different. ANDIn a sense, we are better than before. But, in other respects, we are much worse. Now we have a war in Europe. We have geopolitical tensions in more than one place. Populism and political polarization in the context of internal and external conflicts do not help much when it comes to finding collective solutions. We also have problems in the global production and distribution chains. In other words, globalization is in crisis. And all the regions are looking to return to a more regional system.
We have inflation and, at the same time, economic slowdown. Rather, we are entering a period of stagflation. The US Federal Reserve is raising credit costs at a fairly aggressive pace. And they are not alone. The Bank of England and the European Central Bank, among others, are taking similar actions. These measures reduce demand. Which, sooner or later, will bring a further economic slowdown. This normally means less income, less investment and more unemployment.
Now, Jamie Dimon warns us of the arrival of a “storm”. Of course, Dimon is knowledgeable enough on the subject not to go into too much detail about it. In matters of forecasts and predictions, accuracy is an error that, in general, is paid dearly. However, the caveats are made and the odds are mentioned.
Jamie Dimon warns us that, although the weather at the moment looks sunny, the arrival of a storm is inevitable and that what is at stake is whether the economy will face a category 5 hurricane or something more similar to a tropical storm. Words more, words less, a recession was upon us. However, the severity of that recession remains to be seen. A technical recession could occur with moderate repercussions. We could have a crisis similar in intensity to the Great Recession of 2008. Or we could have something in between these two extremes.
Of course, time passes and the scenario of a “soft landing” (Soft landing) is losing followers in the field of expectations. It is still possible. However, everything seems to indicate that, at the moment, it is not the most likely scenario. Here’s the problem. We still don’t know for sure what’s coming. And that explains the current level of volatility and uncertainty. There is not much clarity about the future. Therefore, the most prudent thing is to be prepared for the different scenarios by assuming a defensive attitude.
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