'Wall Street Emperor' Dimon on US Credit Rating Downgrade: "Not Really Important"

"Not very important." Jamie Dimon, CEO of JPMorgan Chase, known as the "Emperor of Wall Street," dismissed the downgrade of the United States' national credit rating as not significantly important.

On the 2nd (local time), in an interview with economic media CNBC, Dimon called the credit rating agency Fitch's late decision the previous day to downgrade the U.S. credit rating from ‘AAA’ to ‘AA+’ "ridiculous." He emphasized the safety of U.S. Treasury bonds, saying, "Not very important," and "The market decides, not the rating agencies." This aligns with the widespread assessment inside and outside Wall Street following Fitch's decision that the downgrade would not have a major impact on the market.

Dimon said, "There are many countries with higher ratings than us, like AAA, but they are under the U.S. corporate military system," adding, "It is somewhat ridiculous that they, not the U.S., are AAA." He continued, "The U.S. is still the wealthiest country on Earth and the safest country on Earth."

On the same day, Janet Yellen, U.S. Treasury Secretary, also criticized Fitch's credit rating downgrade as a "flawed and inappropriate decision." Attending an event in Virginia, she said, "Fitch's decision is baffling when compared to the economic strength we are seeing in the U.S.," and countered, "It does not change what we already know?that U.S. Treasury bonds are the safest and most liquid assets in the world, and the U.S. economy is fundamentally strong."

Earlier, Fitch cited political conflicts over raising the federal government's debt ceiling, fiscal deterioration, and national debt burden as reasons for downgrading the U.S. credit rating. It is the first time in 12 years since S&P in 2011 that a major international credit rating agency has downgraded the U.S. credit rating.

[Image source=AP Yonhap News]

On the same day, Dimon acknowledged concerns about the political uncertainty in Washington cited by Fitch as a reason for the downgrade. He said, "The debt ceiling must be removed," pointing out that it "is causing market uncertainty."

Regarding the U.S. economy, he said that although the previously warned "storm" remains, "even if there is a recession, it will be at a fairly decent level." He cited geopolitical risks due to the Ukraine war and the Federal Reserve's quantitative tightening as concerns. Additionally, he criticized the authorities' moves to strengthen regulations on the U.S. banking sector as "very disappointing." He said, "If I were the Fed, I would be cautious about saying their model is perfect," adding, "We must remember that their model did not predict inflation or interest rates in the 5% range."

Furthermore, he evaluated artificial intelligence (AI) technologies like ChatGPT as a "game changer" that helps future generations live longer and better lives. He said, "We must act immediately," but also expressed concerns, saying, "There is worry because it can be misused."

This content was produced with the assistance of AI translation services.