Jamie Dimon Warns of Economic ‘Hurricane'

A few weeks ago J.P. Morgan Chase chief Jamie Dimon warned that there were storm clouds looming over the U.S. economy.

Now he wants to upgrade the storm forecast to a hurricane warning.

“I said there were storm clouds, big storm clouds. It’s a hurricane,” Dimon said at a conference Wednesday. “Right now it’s kind of sunny, things are doing fine, everyone thinks the Fed can handle it. That hurricane is right out there down the road coming our way. We don’t know if it’s a minor one or Superstorm Sandy. You better brace yourself.”

Dimon’s remarks were reported by Bloomberg News.

Dimon warned that the Fed’s plan to shrink its balance sheet, often referred to as quantitative tightening or QT, was also introducing new risks.

“We’ve never had QT like this, so you’re looking at something you could be writing history books on for 50 years,” Dimon added, according to CNBC.

The Fed has said it will begin to shrink its balance sheet this month by letting maturing bonds roll off at an initial pace of $47.5 billion per month. That is scheduled to double to $95 billion a month in September.