Tariffs will fuel inflation and slow growth, Dimon says
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JPMorgan Chase CEO Jamie Dimon. Photo: Win McNamee/Getty Images
The U.S. economy was already weakening before President Trump's sweeping new tariffs, and those levies will now fuel inflation and slow growth, JPMorgan Chase CEO Jamie Dimon says in his annual letter Monday.
Why it matters: Dimon, for decades one of the most powerful figures in global finance, offered his views not in a vacuum, but in the midst of a global market crisis sparked by the new import tax regime.
What he's saying: "There are many uncertainties surrounding the new tariff policy: the potential retaliatory actions, including on services, by other countries, the effect on confidence, the impact on investments and capital flows, the effect on corporate profits and the possible effect on the U.S. dollar," Dimon writes in the closely watched shareholder letter.
- "The quicker this issue is resolved, the better because some of the negative effects increase cumulatively over time and would be hard to reverse. In the short run, I see this as one large additional straw on the camel's back."
The intrigue: Of all the Wall Street banks, JPMorgan was early out of the gate forecasting the newest tariffs were more likely than not to cause a recession this year.
- The sell-off weighed on those banks, including Dimon's. JPMorgan stock is down 12% this year, though his competitors have fared much worse.
Between the lines: In his 2024 letter, Dimon laid out a pro-trade message. This year, he acknowledges the U.S. is right to protest, and try to fix, some trade abuses.
- But he also says the answer is negotiations, particularly those that preserve international economic alliances.
Dimon's five-point plan
Zoom out: The 58-page letter is prescriptive, offering the five things Dimon says America needs to do to secure a positive future — and cautioning if it fails at one, it could fail at all.
- "Celebrate America's values and virtues" — Dimon writes "While we should acknowledge America's flaws, they should not be used to pull apart our country." It's a nod to the tension between the administration's anti-DEI stance and what he elsewhere calls JPMorgan's commitment to "reaching out to all communities."
- Acknowledging and fixing the country's problems — Here he offers a list of things that need fixing, including the borders, the income gap, the cost of college, culture wars, and inefficient government.
- Policies that drive economic growth — Dimon praises GOP efforts to build more competitive tax systems and limit overregulation, but warns an effective regulatory system is still required to prevent market abuses.
- "Win the new global 'economic' war" — In no uncertain terms, Dimon calls for strengthening international economic alliances to deter autocrats and preserve democracy, a subtle retort to the administration's America First worldview.
- The best military, at any cost — Dimon says the U.S. must continue supporting Ukraine and Israel, and acknowledge that with advances in technology, foreign wars are closer than ever before.
The bottom line: Dimon, while never once mentioning Trump by name, makes clear the stakes of the international upheaval since he took office.
- "We need to bring the whole of government and the private sector together to build the world we want while dealing with the cold realities of the world we have," he writes.
