Jamie Dimon used his traditional annual letter to JP Morgan Chase shareholders to issue a warning that goes beyond the usual overview of banks, credit, and the economy. In the view of the CEO of the largest bank in the United States, the war in Iran could turn into a new inflationary shock, raise interest rates, and trigger a more severe correction in financial markets.
In the document released this Monday, April 6th, Dimon states that the conflict adds pressure to an environment already marked by war in Ukraine, tensions in the Middle East, and growing friction between major powers. The risk, according to him, is of new shocks in oil and other commodities in the coming months, which could make inflation more persistent and, ultimately, push interest rates upwards.
For him, the risk that the market is still treating with complacency is that of inflation regaining strength in 2026. In the letter, he summarizes this threat with the expression " the skunk at the party ": a kind of spoilsport capable of, on its own, driving interest rates up and driving down asset prices.
Dimon even uses history to support his argument. He points out that rapid oil price increases helped trigger major recessions in the 1970s and 1980s—although he emphasizes that the United States today is less vulnerable to this type of shock than it was during that period.
Still, the parallel serves to show that, for him, war is not just an abstract geopolitical risk, but an event with the concrete potential to contaminate activity, prices, and markets. The strategic role of the Strait of Hormuz, one of the main global oil routes, helps explain why energy appears at the center of the alert.
The letter also broadens the focus beyond the economy. Dimon argues that the outcome of conflicts between major powers, including the wars in Ukraine and Iran, is more important than their immediate financial effects.
In another passage, he hardens his tone, stating that the role of the Iranian regime in fostering terrorism and the deaths of thousands of people, including Americans and Iranian citizens, should not be ignored, arguing that this threat must be confronted appropriately. This passage marks a more political than merely economic inflection point in the document.
At the same time, the banker does not describe a collapsing American economy. On the contrary. According to him, the United States remains resilient, with consumers still employed and businesses in a relatively healthy position, although some recent signs of weakening are beginning to appear. This resilience, however, coexists with a more fragile backdrop, sustained by years of stimulus, high deficits, and a growing need for infrastructure investment.
He also lists factors that could support activity in 2026, such as additional fiscal stimulus, a potentially more lenient regulatory environment, and the expansion of investments in artificial intelligence.
Economists at the bank estimate that the fiscal package advocated by Donald Trump could inject around US$300 billion into the American economy, equivalent to 1% of GDP, while spending by hyperscalers on AI is expected to jump from US$450 billion in 2025 to US$725 billion in 2026. The problem, Dimon notes, is that some of these factors could also fuel inflation in the short term.
Private markets, private equity and AI
Although the letter's tone is cautious, Dimon does not ignore the engines that could still sustain the American economy in 2026. Among them, he cites additional fiscal stimulus, the prospect of less regulatory pressure, and the billion-dollar race for artificial intelligence.
According to JP Morgan's calculations, hyperscaler investments in Artificial Intelligence (AI) are expected to increase from US$450 billion in 2025 to US$725 billion the following year. However, this doesn't make the diagnosis any more benign: according to the executive, these same factors could end up reinforcing the inflationary pressures that the market insists on treating as temporary.
The document also devotes considerable space to private markets, where Dimon sees growing weaknesses. Regarding private credit , he states that the segment probably does not represent a systemic risk to the financial system, but warns that several higher-risk credit modalities may suffer greater losses than expected in a slowdown, at a time when lending standards are worsening among various lenders.
According to him, selling private credit products to retail investors requires "greater transparency" and "higher standards" than those currently observed. Elsewhere, he states that not all agents currently offering credit are necessarily good at it, and that many entered this market late—making it expected that some will perform much worse than others when the cycle turns.
The criticism didn't stop there. Dimon also took a jab at private equity , another recurring target of his letters. According to him, with the stock markets at recent highs, it's striking that private equity firms—which control something close to 13,000 companies—haven't taken more advantage of the good times to list these assets on the market. For the CEO of JP Morgan, this hesitation raises doubts about what would happen to these portfolios in a prolonged bear market.
The banker also reiterated his attacks on aspects of American banking regulation. He described some aspects of capital rules as very flawed and renewed his criticism of the surcharge applied to systemically important banks, the so-called ' GSIB surcharge '. Even after recent adjustments, Dimon argues, the requirement remains excessive in the case of JP Morgan.
