“According to Dimon’s statement to CNN on Thursday, it seems that we are approaching the conclusion of this specific crisis. Dimon, the CEO of JPMorgan Chase and a prominent figure in the financial industry, expressed his belief that any remaining issues will be resolved. While he admitted uncertainty about the possibility of additional bank failures, Dimon remains optimistic that the aftermath of the crisis has come to an end, regardless of whether or not the Fed decides to reduce interest rates. Fortunately, there is positive news to report.”
Dimon remarked, “That is not occurring at other regional banks.” “And they simply departed–$140 billion or something in the span of two days,” Dimon added. SVB also possessed a concentrated group of venture capital customers who oversaw 35,000 corporate accounts “and they simply departed–$140 billion or something in the span of two days,” Dimon added. He mentioned that within the industry, “everyone knew” about the risks associated with increasing interest rates and uninsured depositors that caused SVB’s downfall. Dimon reaffirmed his belief that the issues that led to SVB’s collapse were “hidden in plain sight” and should have been detected by the bank’s management.
Dimon stressed that the current banking crisis is completely different from that incident as he is the only CEO of a major bank who was leading his company during the Global Financial Crisis of 2008.
He stated, “regardless of the crisis, numerous financial institutions will report ‘fairly positive’ profits in the upcoming weeks.” He contended that individuals ought to remain calm. The issue will ultimately be resolved one way or another. There are only a few banks that encountered this specific issue. It is significantly more restricted. This is not reminiscent of the situation in 2008.
A new Harris poll found that the majority of depositors in U.S. Banks believe that their money is safe. And it seems that only a few Americans agree that recent bank instability has mostly been controlled by greedy and dumb institutions. This is not a systemic event, as Jim Chanos, the famed short-seller who was told by Insider last week, echoed those comments made by Dimon.
Dimon acknowledged that the very public failure of multiple banks will contribute to tighter credit conditions, which in turn increases the chances of a recession. He argued that this situation amounts to another “storm cloud” for the economy, ultimately resulting in fewer loans for businesses and consumers. Despite this, he still emphasized the importance of addressing these challenges.
“However, it is recessionary. It may not necessarily result in a recession, but it is similar to an additional burden on the scale,” Dimon continued to follow that pattern on Thursday, informing CNN’s Poppy Harlow that the United States is confronting numerous significant hazards–such as war, inflation, and increasing interest rates–that could potentially trigger a recession. The CEO has been expressing this viewpoint for almost a year now.