America’s largest bank JP Morgan has issued a major warning about the prospects of the US economy and the dollar. The global leading bank took note of the $34 trillion debt that’s plaguing the US economy and threatening the markets. The bank warned that the US economy is now like a “boiling frog” waiting for a catastrophe to happen. JP Morgan’s negative outlook about the US economy and the dollar comes at a time when BRICS is looking to topple its global supremacy.
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For the uninitiated, the term boiling frog is a metaphor used to describe the failure to act against a problematic situation. The syndrome eventually increases in severity until reaching catastrophic proportions and the US economy is headed in the same direction. Read here to know how many sectors in the US economy will be affected if BRICS stops using the dollar.
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BRICS: JP Morgan Says US Debt & Economy Is Now Like a ‘Boling Frog’
The US national debt crossed $34 trillion this month in January 2024 reaching an all-time high. The debt is growing at an uncontrolled pace that could wreak havoc in the US stock markets. “The problem for the US is the starting point; every round of fiscal stimulus brings the US one step closer to debt unsustainability,” said JP Morgan strategist Michael Cembalest.
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“However, we’re accustomed to deteriorating US government finances with limited consequences for investors. And one day that may change (the boiling frog analogy). The US has run out of the road on that one,” Cembalest added.
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JP Morgan’s warning about the US economy coincides with the ideals of the de-dollarization efforts initiated by BRICS. While the threat of debt looms large, BRICS challenging the US economy is another danger America needs to confront. If left unchecked (like the debt), the cocktail is a recipe for disaster and BRICS could bring the US economy down.