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Morgan Stanley Damon: Although the risk of a US economic recession has decreased, it cannot be ignored. Trade uncertainty suppresses investment willingness
industry9 months before
Summary：JPMorgan Chairman and CEO Jamie Damon recently stated that although the risk of a US economic recession has eased, the possibility of a recession cannot be completely ruled out. The temporary suspension of tariffs has been affirmed, but trade uncertainty still affects investor confidence. BlackRock CEO Fink pointed out that the market's wait-and-see fund size has reached a historic high, and short-term fluctuations have a complex impact on the trading business of financial institutions.
Newspaper (North America) NewsOn May 15, 2025, Jamie Damon, Chairman and CEO of JPMorgan Chase, stated in an interview with Bloomberg that although the risk of a US economic recession has decreased, it still exists and cannot be completely ruled out.
Damon bluntly stated, "I cannot rule out the possibility of an economic recession. If a recession does occur, its severity and duration are difficult to predict. We hope to avoid it, but this possibility still exists." He emphasized that this judgment is mainly based on the in-depth analysis of his economic team.
Two days ago, Michael Feroli, Chief US Economist at JPMorgan Chase, released a research report stating that "we believe the risk of an economic recession is still high, but the probability has now dropped to below 50%." This assessment is lower than the expectation when the Trump administration announced a new round of tariff policies last month.
It is worth noting that the Trump administration has decided to postpone the implementation of some "Liberation Day" tariffs and agreed to lower tariffs on some Chinese goods within the framework of a 90 day trade ceasefire agreement with China.
Damon expressed support for this, saying, "Their current approach is correct - delaying implementation, allowing the Treasury Department to focus on addressing unfair trade issues, and seeking appropriate response strategies
However, Damon pointed out that even in the context of the current tariff truce, the market still faces uncertainty, which suppresses investor enthusiasm. Even at this stage, you can clearly see companies delaying investments and reassessing their strategic direction, "he added.
This viewpoint has been echoed by Larry Fink, CEO of BlackRock Group. At a meeting held in Saudi Arabia this week, Fink said, "Faced with uncertainty, investors tend to hold more cash, which is particularly evident in the European and American markets." He cited data showing that the current size of wait-and-see funds in European and American bank accounts and money market funds is about $24 trillion, reaching a historic high.
Damon also mentioned that the recent trading opportunities brought about by intensified market volatility have had a positive impact on JPMorgan's trading department. Fluctuations can be good or bad, and this one is actually good for our trading business, but the future situation may be different, "he admitted.
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