US, global economy facing ‘very, very serious’ mix of headwinds: JP Morgan chief

New York, Oct 11 (SocialNews.XYZ) The US and global economy is facing a "very, very serious" mix of headwinds that is likely to cause a recession by the middle of next year, warns Jamie Dimon, chief executive of JP Morgan Chase, the largest American investment bank.

Dimon pointed to the effects of runaway inflation, sharp interest rate rises and Russia's war in Ukraine, as factors that informed his thinking, The Guardian reported.

But he added that the US is "actually still doing well" and consumers were likely to be in better shape compared with the global financial crisis in 2008.

Dimon said that the US Federal Reserve "waited too long and did too little" as inflation jumped to a 40-year high over the past 18 months.

He said the central bank, which has raised rates five times so far this year, is "clearly catching up".

"And, you know, from here, let's all wish him (Fed chair Jerome Powell) success and keep our fingers crossed that they managed to slow down the economy enough so that whatever it is, is mild - and it is possible," The Guardian quoted Dimon as saying.

But the bank chief said he expected volatile market conditions that could coincide with disordered financial conditions.

The benchmark S&P 500, Dimon said, could fall by "another easy 20 per cent", The Guardian reported.

"The next 20 per cent would be much more painful than the first."

This is not the first time Dimon has warned of a sharp financial downtown.

In June he said he was preparing the bank for an economic "hurricane", adding that JP Morgan "is bracing ourselves and we're going to be very conservative with our balance sheet".

Dimon is not alone in anticipating tough times.

Over the weekend, Mohamed El-Erian, chief economic adviser at the German financial services giant Allianz SE said the US economy is on "a bumpy journey to a better destination".

Source: IANS