JPMorgan Chase CEO Jamie Dimon warns Washington of a potential global market "rebellion" due to the record-high U.S. debt. Dimon emphasizes the urgency of the situation, comparing it to driving at 60 mph toward a "cliff."

The global economy is headed toward a dangerous precipice due to soaring government debt, warns JPMorgan Chase CEO Jamie Dimon. He believes this unsustainable trajectory will culminate in a severe market downturn and a loss of trust in government institutions.

Currently, the U.S. national debt stands at a staggering $34.14 trillion, equivalent to approximately $100,000 for every American citizen. This figure is even more concerning when considering that the debt ceiling has been suspended until 2025, thanks to a deal struck in mid-2023.

While certain short-term economic indicators appear positive, such as falling inflation, potential interest rate cuts by the Federal Reserve, and stable employment levels, Dimon remains unconvinced. He sees a major red flag looming on the horizon.

Speaking at the Bipartisan Policy Center alongside former Speaker of the House Paul Ryan, Dimon drew a parallel between the current situation and the 1980s. Back then, the U.S. faced high unemployment rates and a stagnant stock market, yet the debt-to-GDP ratio was only around 35%. Today, it has ballooned to a concerning 100%.

Dimon emphasized that during economic downturns, the government typically runs deficits of around 4% to 5%. However, in the current era of economic growth, the deficit stands at an alarming 6.5%.

Projecting forward, Dimon warns that the debt-to-GDP ratio is on track to reach 130% by 2035. This exponential increase, which he likens to a "hockey stick" trajectory, will likely trigger a global market "rebellion."

Dimon's dire prediction stems from the rising cost of servicing the increasing debt, particularly if the economy enters a period of slow or no growth. This issue is not confined to the United States; countries worldwide hold a significant portion of U.S. debt, totaling approximately $7.6 trillion. Japan, China, the United Kingdom, Luxembourg, and Canada are among the most exposed nations.

Dimon stresses that engaging in a global financial conflict with both domestic and international markets would be the "worst possible approach." He warns that the U.S. government is hurtling toward a cliff, estimating that the crisis is about ten years away.

Ryan concurred, describing the debt spiral as the "most predictable crisis we've ever had." Dimon agreed, underscoring the gravity of the situation.

Beyond the financial implications, Dimon sees this issue as a matter of global security. He emphasizes the need for a stronger military and a more robust America to address rising geopolitical tensions, such as the Israel-Hamas conflict and the Russian invasion of Ukraine.

During a wide-ranging discussion in Washington, D.C., Dimon also weighed in on other topics, including wealth inequality. He expressed support for higher taxes on the wealthy to aid the poor, describing it as a "no-brainer policy."

The banking executive, who was recently praised for his acquisition of First Republic Bank, advocated for closer collaboration between the public and private sectors in policymaking and decision-making. He highlighted that private sector contracts support the military and account for 80% of America's payroll.

Lastly, amidst rumors about his potential political ambitions, Dimon dismissed the idea of transitioning from the boardroom to the Oval Office. He emphasized the importance of transparency and accountability in government spending and called for public disclosure of how funds are utilized.

“I’m staying at JPMorgan for now,” Dimon joked in response.