JPMorgan CEO Warns of Underestimated Market Risks, Avoids Stocks and Long-Term U.S. Bonds

According to ME News, on July 21 (UTC+8), JPMorgan Chase CEO Jamie Dimon stated that investors are underestimating the geopolitical and fiscal risks facing the global economy; at current prices, he would not buy the overall stock market or long-term U.S. Treasuries. Dimon noted that the war in Ukraine, conflicts in the Middle East, rising tensions between China and the U.S., and increasing defense spending amid expanding government deficits could all ultimately disrupt markets. Although the global economy is more resilient due to reduced energy dependence, this does not rule out sudden market shifts. Persistent large U.S. fiscal deficits may eventually push interest rates higher, forcing bond investors to demand higher returns to hold government debt. He believes that even if inflation falls to the Federal Reserve’s 2% target, the 10-year Treasury yield could remain between 4% and 4.5%, leaving limited upside potential for long-term bond prices. Regarding equities, Dimon said he would consider buying individual stocks if they represent strong investment opportunities, but he would not buy the broader market at current valuations. The S&P 500 has risen nearly 10% year-to-date. On AI, Dimon compared the current investment frenzy to the early days of the internet. He believes that overall AI spending may ultimately yield returns similar to those of the internet, but the manner and timing of those returns “will certainly not be as people expect.” He pointed out that early internet giants like Yahoo and Netscape later faded, while eventual winners such as Google and Facebook emerged afterward. (Source: BlockBeats)