JPMorgan Chase CEO Jamie Dimon called the US stock market “kind of inflated” — even as he urged critics to “get over” their fears of President Trump’s proposed tariffs.
During an interview on Wednesday with CNBC at the World Economic Forum in Davos, Switzerland, Dimon cautioned investors on the risks of increased deficit spending, sticky inflation and geopolitical tensions.
“Asset prices are kind of inflated, by any measure. They are in the top 10% or 15%” of historical valuations, Dimon said.
The 68-year-old chief executive said he was speaking specifically about the US stock market – which has seen record gains during a multi-year bull run.
The S&P 500 had annual gains of more than 20% both last year and in 2023 – the first time the US stock market has seen back-to-back gains of that size in 25 years. Last year, Dimon even said JPMorgan’s shares were too expensive.
Dimon also pointed out that parts of the bond market, like the country’s sovereign debt, are “at all-time highs.”
“So yeah, they’re elevated, and you need fairly good outcomes to justify those prices,” Dimon said at the conference. “Having pro-growth strategies helps make that happen, but there are negatives out there, and they can tend to surprise you.”
Meanwhile, Dimon chastised critics of Trump’s hefty proposed tariffs on China, Mexico and Canada, telling them to “get over it.”
Tariffs can be “an economic tool” or “an economic weapon,” depending on how they’re used, Dimon said.
“I would put in perspective: If it’s a little inflationary, but it’s good for national security, so be it,” he added. “I mean, get over it.”
In his first days in office, Trump has doubled down on his threats to impose sizable tariffs – including a 10% tariff on Chinese imports and 25% tariffs on goods from Mexico and Canada, to take effect Feb. 1.
Economists and business leaders have warned that the tariffs could stoke inflation once more, especially combined with mass deportations.
But Dimon signaled more faith in Trump’s plan, arguing that tariffs can be used as a negotiating tool to “bring people to the table.” He said he believes the Trump administration is using the threats this way.
It’s not the first time Dimon has backed Trump, saying soon after the president’s election win that Wall Street bankers were “dancing in the street” on hopes that Trump would loosen industry regulations.
If the threats are simply a bartering tool, as Dimon suggested, then the US might levy lighter tariffs on China, Mexico and Canada, or no new tariffs at all.
“We’re going to find out,” Dimon said.
During his first term, Trump imposed tariffs on goods like solar panels and washing machines, and materials like steel and aluminum. He also increased tariffs on goods from China.
Despite Dimon’s more upbeat take on the proposed tariffs, he has long been reluctant to claim victory over inflation.
In 2022, the chief executive – who grew JPMorgan Chase into the largest American bank by both assets and market valuation – warned that a “hurricane” was headed for the US economy.
“I do have a little more caution around a bunch of subjects,” Dimon said during the World Economic Forum. “What I’m a little cautious about is the deficit spending; it’s a global issue, not just an American issue.”
He also stood by his previous statements on inflation, predicting it might be here to stay.
“‘Will inflation go away?’ I’m not so sure,” Dimon said.
He said global concerns, like the war in Ukraine, tensions in the Middle East and threats from China have “just got me very concerned how it’s going to affect our world for the next 100 years.”