JPMorgan Chase & Co (NYSE: JPM) CEO Jamie Dimon has expressed concerns about the possibility of a "hard landing" for the U.S. economy, with stagflation being the worst-case scenario.
What Happened: Speaking at the JPMorgan Global China Summit in Shanghai, Dimon raised the possibility of a hard landing for the U.S. economy, reported CNBC. He noted that a "hard landing" could not be ruled out, considering historical patterns.
Dimon highlighted the worst possible outcome for the U.S. economy - a scenario of stagflation - where inflation continues to rise, but growth slows amid high unemployment.
Despite these concerns, Dimon pointed out that the consumer is still in good shape even if the economy slips into a recession.
Dimon emphasized the unemployment rate, which has been below 4% for about two years, and the increase in wages, home prices, and stock prices, according to CNBC.
However, the 68-year-old bank chief noted that consumer confidence levels are low, mainly due to inflation. He warned that the world is not adequately prepared for higher inflation.
Why It Matters: Dimon's take comes after the Federal Reserve indicated that it may need to raise interest rates to curb inflation. That could potentially slow down the economy.
Dimon's comments also come in the wake of increasing global economic influence from China. While speaking at the summit, he also underscored the significance of China in the global economy, a point also emphasized by the JPMorgan APAC CEO Sjoerd Leenart.
Dimon's warning about a possible hard landing for the U.S. economy and the potential impact of stagflation adds to the growing economic uncertainty, especially in light of the Fed's ongoing concerns about inflation.