JPMorgan Chase CEO Jamie Dimon: U.S. stocks are "a bit overvalued"

JPMorgan Chase CEO Jamie Dimon stated that the U.S. stock market is inflated, and he is more cautious than others in the business community due to risks from deficit spending, inflation, and geopolitical turmoil.

On Wednesday, during an interview with CNBC at the World Economic Forum in Davos, Switzerland, JPMorgan Chase CEO Jamie Dimon said:

U.S. stock market asset prices are "a bit frothy," and by any measure, asset prices are in the top 10% or 15% of historical valuations.

The U.S. stock market is in a multi-year bull market, with the S&P 500 index achieving over 20% annual gains in both 2023 and 2024, marking the first time in 25 years.

Dimon also pointed out:

Certain parts of the bond market, such as sovereign debt, are also at "historically high levels."

Dimon stated that you need quite good results to justify these prices, “Formulating growth-friendly strategies helps achieve this, but there are also negative factors that can often catch you by surprise.”

It is noteworthy that Dimon has maintained a cautious stance since 2022 when he warned that the U.S. economy would face a "hurricane." Last year, Dimon even referred to his company's stock price as expensive.

However, the U.S. economy has performed better than expected, especially after Trump's election in November, which boosted expectations for growth-supporting policies.

Dimon expressed caution regarding several aspects:

Deficit spending: This is a global issue, not just a U.S. problem;

Inflation: He is skeptical about whether inflation will subside;

Geopolitical conflicts: Including the threats from the Russia-Ukraine conflict and tensions in the Middle East.

Additionally, Dimon revealed that his previously tense relationship with Elon Musk has eased, and he has no intention of running for public office in 2028