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Jamie Dimon says Congress should not play video games with the creditworthiness of the U.S. authorities

Jamie Dimon, President, CEO & Chairman of JP Morgan Chase, talking on Squawk Field on the WEF in Davos, Switzerland on Jan. 19th, 2023. 

Adam Galica | CNBC

JPMorgan Chase CEO Jamie Dimon mentioned Thursday that politicians ought to be severe in regards to the debt ceiling as Congress stays locked in a political combat to extend the U.S. borrowing restrict.

“We should always by no means query the creditworthiness of the US authorities. That’s sacrosanct. It ought to by no means occur,” Dimon mentioned Thursday on CNBC’s “Squawk Field” from the World Financial Discussion board in Davos, Switzerland.

His feedback come as Congress stays in a standoff over the debt ceiling, the sum of money the U.S. is permitted to borrow to pay its payments. Treasury Secretary Janet Yellen mentioned final week {that a} U.S. debt default would “trigger irreparable hurt to the U.S. financial system, the livelihoods of all People, and international monetary stability.”

Right now, Dimon mentioned, “In fact Democrats will blame the Republicans and Republicans will blame the Democrats. I do not care who blames who. Even questioning it’s the flawed factor to do. … That’s simply part of the monetary construction of the world. This isn’t one thing you ought to be taking part in video games with in any respect.”

The present ceiling is about $31.four trillion. Since the price of authorities operations exceeds federal tax revenues, the U.S. should increase cash by promoting Treasury bonds, however cannot accomplish that past the mandated debt ceiling.

A U.S. default would ship shock waves all through the U.S. and international economies, together with market volatility and frozen federal advantages.

On the broader financial system, Dimon mentioned inflation will doubtless stay stubbornly elevated, forcing the Federal Reserve to boost rates of interest increased than 5%.

— CNBC’s Greg Iacurci contributed reporting.

Correction: Treasury Secretary Janet Yellen mentioned final week {that a} U.S. debt default would “trigger irreparable hurt to the U.S. financial system, the livelihoods of all People, and international monetary stability.” An earlier model mischaracterized her feedback.

This text was initially revealed by cnbc.com. Learn the authentic article right here.

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