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Jamie Diamond chief executive of JP Morgan Chase has put out an interesting warning on where he sees the economy heading over the the upcoming future now this is very interesting because Jamie dimon he has a unique insight into what's going on in the economy with America why does he have a unique Insight why because he runs the largest bank in America JPMorgan Chase he sees the behavior of customers are they putting more money in the bank or are they taking it out and spending it in the economy he sees the behavior of businesses are they hoarding money in the bank because they're worried or are they trying to invest and grow their business you know Diamond I'm sure he's talking the different fed officials on their plans with the economy in the future are they raising rates are they quantitative tightening what's their plans with the economy with their policies in the future my point is that he has a unique insight into the day-to-day Runnings of the US economy an American business so let's see what he's had to save recently Jamie Diamond sees only a 10 chance of an economic slowdown that doesn't lead to a recession while ominously warning there are 20 to 30 odds of something worse the banking boss said on a client call that while the U.S economy is still strong and consumer balance sheets and businesses are in good shape there are storm clouds ahead Yahoo finance reported hiked fed rates quantitative tightening so that's what I just talked about the FED policies oil shocks the war in Ukraine and Rising U.S tensions with China have pushed Diamond to think that a mild recession has a 20 to 30 chance while a harder recession has the same odds but the remaining outcome may be something worse in quotes he said Diamond stresses it is a mistake to point to any single points forecast as to what will happen with the US economy but he has a lot to be pessimistic about confidence is low Diamond argues because of inflation because of partisan politics and a lot of leftover Anger from the virus will just say the virus he predicts inflation will not decrease the way the FED wants it to that's what I see as well calling the goal to bring it down from eight percent to four percent by the end of the year highly unlikely if they can achieve four percent inflation by the end of the year I'll give a big clap to the FED but just like myself like diamond I don't see this happening four percent inflation will be a great achievement for the Federal Reserve Diamond adds I wish we had the spirit that we were all here to work together but it seems we just got nastier somehow yes I see the same thing I don't know if you guys are reading the news reading the comments what your guys sentiments are on today's environment but things definitely say seem to be more clashy or nastier as Diamond puts it okay so let's break down those odds so that I just want to try and understand that he said at 10 only a 10 chance of an economic slowdown that does not lead to a recession only 10 then he said 20 to 30 percent chance of a milder recession happening and then another 20 to 30 chance of a harder recession happening the rest of the odds he said may be something worse which he didn't say what something worse may be but worse than a hard recession I don't know maybe another economic crisis I mean I don't think he knows exactly what he means either but worse than a hard recession so if you look at all of those odds together the highest probability is that we're gonna see a recession a recession of some sort whether it be a mild recession a hard recession or something worse this is all according to Jamie Diamond it's not necessarily early according to myself but it is interesting because as I said before he does have a unique insight into the American economy so what are his reasons why why is it so likely that we're going to see a recession the first thing that he said is that the Federal Reserve is hiking rates so let's just take a quick look at this this is the federal rule funds rate and I'm sure if you've been paying attention to it you'll know what's been happening with the federal fund rate over the past year it has shot up like a rocket so basically at the start of the year it was basically zero percent and then the Federal Reserve said okay things are overheating let's slow things down how do we slow things down well we raise interest rates we make it more costly for the consumer to borrow money and thus they'll borrow less money and spend and invest less money in the economy and thus the economy slows down the thing that they have to watch out for is that they don't make a slow down too much touch causing a recession so zero percent to over two percent uh Federal fundra fund rates today then the other thing that he warned of was quantitative tightening so this is the Federal Reserve instead of injecting money into the system which is quantitative easing he's talking of the federal reserve's plans to quantitative Titan so the U.S central banks moved to reduce nine trillion dollar balance sheet comes alongside steep Freight Rises to tackle persistent inflation this is one of the things that they use to tackle inflation they take money out of the system money becomes more scarce and thus there's less money to demand goods and services less demand should theoretically lower the price at a hashtag lower inflation so those are two things Federal fundraise and quantitative tightening the third thing was the what is this this quantitative tightening again the third thing was the the oil shocks so what he's talking about here is just the extreme rise that we've seen over the past or a year year and a bit in oil prices so April 2020 the price for a barrel of oil was 21.76 since then prices have just been going up and up and up and I'm sure you've been seeing it not only on the news but you've been seeing this with your gas prices a shot all the way up to 116 dollars and yes okay over the past couple of months we have seen a Slowdown but still compared to what it was in 2020 early 2020 prices are way higher than they were a year and a half ago the other thing he talked about was the conflict in Ukraine and Russia and obviously they're not focusing on producing as much and selling to the world economy they're fighting right now which does slow things down especially when you consider all of the the good things that Ukraine and Russia bring to the world economy the last point that he talked about was the increased tensions in the USA and China and I'm sure one of the things he's getting at was when Nancy Pelosi went to visit Taiwan and China were not happy about this because obviously they're kind of looking to take over Taiwan so she visited Taiwan because she wanted to say listen Taiwan we support you we support your Independence China they weren't happy with this the Chinese government again I see so many stories like this they just make me dislike the Chinese government they're just so power hungry they're just trying to take over so many different islands near to them and they just do it in such a sneaky sneaky way so I'm definitely back in the USA in this and I'm definitely back in Taiwan in this conflict so all of these things things guys are the reasons why he is predicting this recession this mild recession this harder recession this something worse whatever he means there of happening it's for these five reasons I'm personally I'm I'm not overly worried about it but one of the things that I when I see these different headlines this is not the only headline I'm seeing it's not only Jamie Diamond work warning of a recession it's lots of other you know quite highly qualified investors I'm not worried but there is a part of me that thinks okay let's just try make as much money as we can in this environment uh before things may turn sour because right now overall the economy is in decent shape there is still a lot of money in the system and you might say no the economy is gone the stock market's gone down by so much the economy is not actually in that greater shape I would argue the other side of the things I think we've had it we've had a 12-year bull market essentially interest rates still on historical level are still low and I still think there is a lot of money to be made especially when it comes to my business anyway but I can see what Jamie dimon is saying that things may get worse in the future that's why I'm keeping my debt very low when I get extra money I'm just putting in putting it away and paying off my debts and I am playing the investing game quite safe are you guys doing the same what's your strategy
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