The U.S. stock markets tumbled early this week as Down Jones crashed by more than 1,000 points in the indices. Over $2 trillion in wealth was wiped out in three days as fears of a U.S. recession loomed. The crash was also extended to BRICS countries making India, China, Russia, and even G7 member Japan’s stock markets tank. However, the markets briefly recovered on Tuesday but ended Wednesday’s trade in the red. As the U.S. and BRICS nations’ stock markets remain in jeopardy, JP Morgan CEO Jamie Dimon predicted that a recession is coming.
Also Read: ‘BRICS Bridge’ To Replace SWIFT and End Dependency on the US Dollar
Dimon revealed in an interview with CNBC on Wednesday that the odds of a “soft landing” for the U.S. economy remain around 35% to 40%. The odds make a recession in the U.S. more likely and could certainly come sooner than expected. A recession in the U.S. predicted by JP Morgan could deal a blow to the dollar as the BRICS alliance is looking to end dependency on the currency.
Read here to know how many sectors in the U.S. will be affected if BRICS ditches the dollar for trade. The next recession could be disastrous if the US dollar doesn’t meet the supply and demand requirements in the markets.
Also Read: BRICS: US Markets Could Face Substantial Losses, Analyst Declares
BRICS: A Recession Is Coming, Says JP Morgan CEO
JP Morgan CEO explained that a cocktail for disaster is brewing that could take the U.S. economy down. The ingredients for disaster are occurring in real-time around the world as we speak, he said. They include geopolitics, deficits, housing problems, and conflicts around the world. The same has affected the economies of BRICS countries and the US simultaneously.
Also Read: BRICS: Goldman Sachs Makes Major US Recession Prediction
“There’s a lot of uncertainty out there,” Dimon said. “I’ve always pointed to geopolitics, housing, the deficits, the spending, the quantitative tightening, the elections, all these things cause some consternation in markets.” However, the JP Morgan CEO said that if a recession hits the markets, the U.S. will be fine but not BRICS.
“I’m fully optimistic that if we have a mild recession, even a harder one, we would be okay (Not BRICS). Of course, I’m very sympathetic to people who lose their jobs. You don’t want a hard landing,” the JP Morgan CEO summed it up.