The banking crisis is far from over, according to JPMorgan Chase CEO Jamie Dimon. “Even when it is behind us, there will be repercussions from it for years to come…But importantly, recent events are nothing like what occurred during the 2008 global financial crisis,” Dimon said, calling for the strengthening of smaller banks. “It’s a US Treasury G7 sovereign debt, balance of payments problem…If we’re going to have a Treasury problem, we’re going to have an everything problem,” said financial researcher Luke Gromen, concluding that Fed Chair Jerome Powell only has “terrible” options to choose from in a fight for balance against inflation, recession, debt, and deficit spending. Gromen’s advice to investors is to avoid excessive leverage, which includes allocating 5%–10% of their portfolios to gold. Economist Mohamed El-Erian is also warning investors about the recent policy decisions, calling the Fed’s inadequate bank stress tests prior to the forceful tightening its biggest mistake in several decades.
CNBC/Jesse Pound
Jamie Dimon says the banking crisis is not over and will cause ‘repercussions for years to come’
The stress on the financial sector caused by two bank failures in the United States last month is still a threat and should be addressed by a reimagining of the regulatory process, according to JPMorgan Chase
CEO Jamie Dimon.
“As I write this letter, the current crisis is not yet over, and even when it is behind us, there will be repercussions from it for years to come,” the longtime CEO said in his annual letter to shareholders Tuesday.
“But importantly, recent events are nothing like what occurred during the 2008 global financial crisis,” he added.
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Business Insider/Theron Mohamed
The US economy faces an ‘everything problem’ – and the Fed has only bad options, researcher says
Jerome Powell has only “terrible” options to choose from, as the Federal Reserve chair weighs the threat of historic inflation against the risk of a financial and economic disaster, a veteran researcher says.
Powell’s latest headache, the recent flurry of bank failures, points to a much bigger threat to America, Luke Gromen told RealVision in a recent interview. The head of Forest for the Trees, a financial-research firm, said the core issue lies with the government’s debt and deficit spending.
“It’s not a banking system problem,” he said. “It’s a US Treasury G7 sovereign debt, balance of payments problem.”
You can read the full article, here.
Kitco News/Anna Golubova
This is the Fed’s ‘biggest mistake in several decades,’ says Mohamed El-Erian
Mohamed El-Erian, chief economic adviser at Allianz, is once again warning investors that the Federal Reserve made its biggest policy mistake in decades.
“As first mentioned almost a year ago, I fear that this may well end up being the biggest #Fed policy mistake in several decades,” El-Erian tweeted on Monday.
This time, El-Erian cited inadequate bank stress tests that failed to accurately measure how banks would deal with higher interest rates following the Fed’s most aggressive policy tightening cycle in decades.
You can read the full article, here.
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