Discusses the complex geopolitical situation and compares it to 1938/1948. Also talks about high levels of fiscal spending and government debt around the world.

Geopolitical and financial outlook

Considers whether interest rate hikes of 25bps or 100bps will make a difference and urges people to prepare for higher rates. Compares the current environment to the 1970s.

Impact of interest rate hikes

Discusses efforts around ESG but argues governments are not taking the right approach through carbon taxes and permitting infrastructure projects to reduce emissions. Highlights need for breakthroughs.

Approaches to addressing climate change

Calls for leadership from Western countries, especially the US, across military, diplomacy, development and finance to address global issues. Private capital will also need to be involved.

Leadership needs for addressing global issues

Discusses importance of preparing for possibilities rather than making predictions. Argues central banks were wrong 18 months ago and there should be humility around financial forecasting.

Outlook on economics and forecasting

- Geopolitical situation is complex and uncertain, requiring strong leadership
- Fiscal spending is at unprecedented levels, with high government debt
- Central banks and governments may not be able to effectively manage the financial situation
- The current approach to addressing climate change lacks rationality and efficiency
- Real leadership is needed from the Western world, particularly America, in various areas including development finance
- Private capital is crucial for development, but confidence is hindered by government interference
- Economic forecasting by central banks has been proven wrong in the past, so caution is advised for the future.

JPMorgan Chief Executive Officer Jamie Dimon speaks about the need for “real leadership” to navigate geopolitical concerns and says, “I don’t think it makes a piece of difference whether rates go up 25 basis points or more, like zero, none, nada.” Dimon spoke Tuesday from Riyadh, where he and other finance titans gathered for Saudi Arabia’s Future Investment Initiative conference, nicknamed “Davos in the Desert.”
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When you look at the geopolitical situation, as complex as we've seen, and I don't know if it's 1948 or 1938, obviously we all hope it goes away.

I think it's a little bit of wishful thinking.

It's gonna take real leadership on the part of many people out there.

And then I look at the financial situation, the fiscal spending, which is more than, I'm talking about the United States, but it's almost true around the world, it's more than it's ever been in peacetime, by a long shot, with the highest debt levels we've ever had by government.

And there's this kind of omnipotent feeling that central banks and governments can manage all this stuff, I'm cautious.

I don't think it makes a piece of difference whether rates go up 25 basis points or more.

I think whether the whole curve goes up 100 basis points, you know, I urge people, be prepared for it.

But I look at what we're seeing today more like the 70s.

A lot of spending, a lot of it's going to be wasted.

On the other hand, if you look at the way we're going about it, It's almost like governments want to whack them all and force it, but no carbon taxes, no rational way to go about it.

In the United States, for example, you can't build pipelines to reduce coal emissions.

You can't get the permits to build solar and wind and things like that, so we better get our act together.

I'm hopeful, when I listen to all the R&D, see it around the world, we will make the breakthroughs we need to beat climate, but it's gonna be a day later and longer than it should be because of their own basic incompetence.

I also want to add 1 last thing, I'm taking it from Bob Gates, to fix this it's going to take real leadership from the Western world, in particular America, but leadership which is not just military, diplomatic, development, finance, and the development finance, I don't know if Ajay's still here, what we need in development finance dwarfs what governments can do.

So it can't be done without private capital and private capital, you know, isn't going to come in if they, you know, you build something that gets taken from a government or something like that.

It's 1 of the reasons I think these events are positive.

And the other thing about when you look at economics, I think people prepare for possibilities and probabilities, not calling 1 course of action since.

I want to point out the central banks 18 months ago were 100% dead wrong.

Okay, so maybe there should be humility about financial forecasting.

I would be quite cautious about what might happen next year.


Speaker 0: When you look at the geopolitical situation, as complex as we've seen, and I don't know if it's 1948 or 1938, obviously we all hope it goes away. I think it's a little bit of wishful thinking. It's gonna take real leadership on the part of many people out there. And then I look at the financial situation, the fiscal spending, which is more than, I'm talking about the United States, but it's almost true around the world, it's more than it's ever been in peacetime, by a long shot, with the highest debt levels we've ever had by government. And there's this kind of omnipotent feeling that central banks and governments can manage all this stuff, I'm cautious.

I don't think it makes a piece of difference whether rates go up 25 basis points or more. Like 0, none, nada. I think whether the whole curve goes up 100 basis points, you know, I urge people, be prepared for it. I don't know if it's going to happen. But I look at what we're seeing today more like the 70s.

A lot of spending, a lot of it's going to be wasted. I'm in favor of this whole ESG effort. On the other hand, if you look at the way we're going about it, It's almost like governments want to whack them all and force it, but no carbon taxes, no rational way to go about it. It would be more important. In the United States, for example, you can't build pipelines to reduce coal emissions.

You can't get the permits to build solar and wind and things like that, so we better get our act together. I'm hopeful, when I listen to all the R&D, see it around the world, we will make the breakthroughs we need to beat climate, but it's gonna be a day later and longer than it should be because of their own basic incompetence. I also want to add 1 last thing, I'm taking it from Bob Gates, to fix this it's going to take real leadership from the Western world, in particular America, but leadership which is not just military, diplomatic, development, finance, and the development finance, I don't know if Ajay's still here, what we need in development finance dwarfs what governments can do. So it can't be done without private capital and private capital, you know, isn't going to come in if they, you know, you build something that gets taken from a government or something like that. So we have a lot of work to do.

It's 1 of the reasons I think these events are positive. But I would be quite concerned. And the other thing about when you look at economics, I think people prepare for possibilities and probabilities, not calling 1 course of action since. I've never seen anyone call it. I want to point out the central banks 18 months ago were 100% dead wrong.

Okay, so maybe there should be humility about financial forecasting. I would be quite cautious about what might happen next year.

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Jamie Dimon Calls Central Banks ‘100% Dead Wrong’ on Forecasts