On Wednesday Jamie Dimon, chairman and CEO of JP Morgan Chase, said that the United States economy is like a ship trying to navigate its way through difficult waters. If policymakers get things right, the economy should be able to grow at close to a 2.5 percent rate, the head of the largest U.S. bank by assets told CNBC at the World Economic Forum in Davos.
“The U.S. economy is kind of like a ship that’s going it’s going, ex- the shutdown 2 to 2.5 percent and that’s going to keep going for a while,” Dimon said. “Then you have all this other noise, geopolitical noise, Brexit noise, what’s the Fed going to do on Oct. 2, shutdown, trade. They’re kind of buoys in the water in front of that ship. Eventually that may very well cause a slowdown or a recession.
“I don’t know 2020 or 2021, but the range of possibilities is broader and the range of bad outcomes is increasing.” To make sure that ship doesn’t find danger, Dimon called on Washington officials to end the government shutdown and devise policies that work.
If policymakers fix that things that are broken, GDP could grow consistently at a 3 percent rate, he said.
“The thing we have to do is facts, analysis, details and not just slogans — policies well done and explained to the American public as opposed to slogans and policies that’s implemented and doesn’t work,” Dimon added.
He spoke at the annual meeting of global political and business leaders that has taken on a decidedly negative tone this year after 2018’s strongly optimistic tone. Speakers at Davos have expressed concern about various geopolitical issues such as the U.S.-China trade impasse, the slowing in the Chinese economy and decreasing business and consumer confidence.
Billionaire investor Ray Dalio, for instance, said he fears a recession in 2020, echoing the general level of concern.
Dimon was somewhat more optimistic, though he admonished warring factions in the U.S. to resolve their differences. “Democrats and Republicans should sit down and finish this [shutdown] issue immediately and compromise to do it,” he said.
Among the issues he said need to be addressed are regulatory and immigration reform as well as infrastructure and education, as well as “lots of little things.”