Dimon Warns Credit Downturn Coming; Banks Price Assets Like It Won't

Jamie Dimon, chairman of JPMorgan Chase and professional Cassandra, has issued yet another solemn warning: a credit recession is coming, and it will be "worse than people think." He also noted, with the precision of a man who has said this before, that we "haven't had a credit recession in so long." This is technically true. It is also completely irrelevant, given that JPMorgan and its peers are currently pricing assets as though 2021's monetary free-for-all never ended and the laws of gravity remain suspended.

The irony is so dense it requires its own credit rating. Dimon's bank continues to underwrite deals, finance SPACs, and bundle questionable collateral into investment products—the financial equivalent of warning your passengers about icy roads while pressing the accelerator. JPMorgan's own capital allocation decisions suggest the leadership team views Dimon's warnings as press releases for regulators, not actual risk management directives. Nothing says "we're bracing for impact" like continuing to price risk as if impact is someone else's problem.

"We haven't had a credit recession in so long, so when we have one it will be worse than people think," Dimon pronounced, which is either profound risk disclosure or the most expensive way to say "my bonus is locked in either way." The statement carries the energy of a man holding a fire extinguisher while standing in an actively burning building he owns, warning onlookers about smoke inhalation while declining to use the extinguisher because—and here's the thing—the fire is currently printing money.

Somewhere in a JPMorgan trading floor, a vice president is using Dimon's warning as justification to lever up another leveraged loan fund. The warning, like all warnings before it, has been noted and filed under "Guidance for Media Appearances."