JPMorgan Chase CEO Jamie Dimon has warned that President Donald Trump’s rollout of tariffs court hurt the US credibility in the world.
Dimon said that the US pre-eminence in the world rests on certain values and undoing those values would not do any good.
Dimon remains one of the most influential figures in the United States. He is seen as one of the few voices that may influence Trump. Last week, Trump had referred to Dimon’s remarks as he paused the rollout of country-specific tariffs for 90 days. Dimon had warned that a recession was a likely outcome of tariffs.
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In an interview with Financial Times, Dimon has said that the United States has remained “a haven” because of its prosperity, rule of law, and economic and military strength, but that America’s economic pre-eminence could come under threat from Trump’s attempt to reshape global trade.
“A lot of this uncertainty is challenging that a little bit. So you’re going to be reading about this non-stop until hopefully these tariffs and trade wars settle down and go away so people can say, I can rely on America,” said Dimon.
Economists have been concerned that Trump’s tariffs could plunge the United States into a recession or into a worse condition called stagflation where recession and inflation co-exist. Common Americans as well as investors and traders have been losing trust in the US economy. Since Trump assumed office in January, the US dollar has fallen 8 per cent as a result of uncertainty. On the other hand, the euro has risen 4 per cent in recent days and climbed to a three-year high.
In the wake of tariffs, JPMorgan has raised the risk of recession this year in the United States from 40 per cent to 60 per cent. Moody’s has also maintained the odds of recession at 60 per cent despite the 90-day pause.
Tariffs’ rollout was ‘disorderly’, need to be clear-eyed, says Dimon
Dimon indicted the rollout of tariffs as “disorderly” and said it shocked the world at the time.
Dimon also indicated that he felt there is a lack of clarity in the administration as to what’s the endgame with tariffs. He said that “we should be clear-eyed about what we’re trying to accomplish”.
Dimon further said, “When they announced the liberation day tariffs, they were dramatically different than people expected. Way off the table than what people expected. And that was shocking to the system. The global system, not just in the United States.”
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The interview is not the first time that Dimon has warned about Trump’s policies.
In his annual letter to shareholders last week, Dimon said that Trump’s tariffs and America First policies could weaken America over time.
Whether or not tariffs cause a recession, they “will slow down growth”. He also warned about the ‘America First’ approach.
“America First is fine, as long as it doesn’t end up being America alone. If the Western world’s military and economic alliances were to fragment, America itself would inevitably weaken over time,” said Dimon.
Repeating the point in the interview with FT, Dimon said, “I think we should be clear-eyed about what we’re trying to accomplish. And I also think we should do it with allies . . . I would want to negotiate eventually with Europe, with the UK, with Japan, Korea, Australia, Philippines, and have a very strong economic relationship.”
