U.S. consumer is still spending about 10% more versus a year ago on the back of $1.50 trillion in excess savings from the pandemic-related relief packages. But there’s always a possibility that all of it changes in 2023, says Jamie Dimon – the CEO of JPMorgan Chase and Co (NYSE: JPM).
Dimon reiterates the possibility of a recession
FOMC is expected to lift rates further into the 5.0% next year to fight inflation that’s still running at a red hot 7.70%. And that, the chief executive said on CNBC’s “Squawk Box”, could push the U.S. economy into a recession next year.
Inflation is eroding everything – that trillion-dollar will run out sometimes mid next year. When you’re looking out forward, those things may very well derail the economy and cause a mild or hard recession that people worry about.
Dimon particularly talked of the geopolitical tensions as another meaningful threat for economic growth.
What he’s suggesting of course doesn’t paint a rosy picture for the equities market that’s already down close to 20% for the year.
Jim Cramer is focused more on opportunity
Who doesn’t entirely agree with Jamie Dimon, though, is the famed investor Jim Cramer.
Speaking this morning on “Squawk on the Street”, Cramer called for a need to shift the conversation from negativity to opportunity.
I was put off because he said I’m basically like everybody else. I don’t think we can get out of the situation. Situation is bad. It’ll be inflation or recession. I’m not hearing anyone saying market has created some big values. I don’t hear the word opportunity.
His thesis is that the Fed will have to eventually stop after massive layoffs and that’ll unlock upside for the equities market.
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