US stock market valuations ‘kind of inflated’: JPMorgan’s Jamie Dimon

Investing.com — JPMorgan Chase (NYSE:) CEO Jamie Dimon expressed concerns over the elevated valuations in the U.S. stock market, citing broader risks like deficit spending, inflation, and geopolitical uncertainties. 

Speaking to CNBC at the World Economic Forum in Davos, Switzerland, Dimon said, “Asset prices are kind of inflated, by any measure. They are in the top 10% or 15% of historical valuations.”

Speaking specifically about the US market, Dimon highlighted the ongoing multi-year bull run in equities but noted that parts of the bond market, such as sovereign debt, are also “at all-time highs.” 

He warned that current asset prices require “fairly good outcomes to justify those prices,” emphasizing that while pro-growth strategies could help, negative surprises remain a possibility.

The veteran banker, who has helped transformed JPMorgan into the largest American bank by assets and market valuation, has voiced caution in recent years. 

In 2022, Dimon likened economic challenges to a “hurricane” approaching the U.S. economy. Although that storm has yet to materialize, Dimon remains wary.

“I do have a little more caution around a bunch of subjects,” he told CNBC’s Andrew Ross Sorkin, pointing to global deficit spending as a pressing concern. He also questioned whether inflation will subside, stating, “I’m not so sure.”

Geopolitical tensions further add to Dimon’s concerns, including the ongoing war in Ukraine, unrest in the Middle East, and rising threats from China. 

These issues, he warned, could significantly shape the global landscape over the next century.

While optimism around pro-growth policies from the Trump administration persists, Dimon’s cautious tone serves as a reminder of the uncertainties facing investors in an environment of elevated market valuations.