Jamie Dimon, head of the American Bank JPMorgan Chase and the influential votes in the business community in the United States, worried Sunday about the risk of a crisis in the US debt market, caused by the government’s economic policy. “This is a big problem. This is a real problem. (…) I do not know if it is in six months or in six years, (but) the bond market will have difficulties,” he said in The Fox Business Channel on Sunday, in the extract of an interview that will be transmitted in its entirety on Monday, in the mornings of the program with Maria.
According to the manager, when investors realize the impact of the increase in debt levels, interest rates will be triggered and markets will be interrupted, a dangerous scenario for the economy of the world’s first power. Investors “will examine the country, the rule of law, inflation rates, the policies of the Central Bank,” he said.
The American debt note degraded by Moody’s
Historically, the United States has been able to rest in the market appetite by the United States Treasury bonds, at low interest rates, to support its economy. The rates went up last week (before returning again), in the context of the fears linked to the budget project of President Donald Trump, which includes in particular the extension of the gigantic fiscal credits for his first mandate.
Investors and many ultra conservative officials are concerned about an excessive excavation of the federal deficit. In mid -May, for the first time, the Moody’s qualification agency withdrew its maximum AAA note to the US debt and degraded it to AA1. The White House ads and reversions about customs rights also cause a lot of uncertainty and, therefore, market volatility.
Scott Besent wants to be reassuring
Jamie Dimon had already warned in April against “considerable turbulence” that the US economy must face, citing private customs prices, commercial wars, budget inflation and deficit. “I have known Jamie for a long time, already throughout his career, he has made these kind predictions. Fortunately, not everyone realized,” the American Secretary of the Treasury reacted on Sunday, Scott Besent, during an interview with the CBS Channel.
The “has been” the process, he added. “The objective is to reduce the deficit in the next four years and leave the country healthy in 2028”.
Source: BFM TV
