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JPMorgan chief Jamie Dimon warns US economy faces an outcome worse than a recession

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JPMorgan Chase CEO Jamie Dimon has said he would not rule out an outcome for the US economy which is widely considered to be worse than a recession.

The chief executive of the biggest bank in the US said this week ‘the worst income is stagflation,’ which he would not ‘take off the table.’

Economists consider stagflation, last seen in the US in the 1970s, to be worse than a recession. It would send stocks down, hitting 401(K)s and other retirement savings.

Stagflation is the combination of economic stag-nation and in-flation. Prices continue to soar at the same time as unemployment rises and economic growth slows – a triple whammy of problems.

In a recession, unemployment increases and the economy shrinks – but the silver lining is that there is little or no inflation.

Dimon made the comments at a time when economists are turning their attention toward indicators of potential slowing growth.

While the annual rate of inflation is increasingly moving toward the Federal Reserve’s 2 percent target, reports on employment and manufacturing have revealed some signs of softening, CNBC reported.

Since taking over in 2006, Dimon, 68, has turned JPMorgan Chase – which has retail as well as investment arms – into the world’s biggest and most powerful bank with $4 trillion in assets.

Dimon said on Tuesday at a fall conference from the Council of Institutional Investors in New York City: ‘I would say the worst outcome is stagflation – recession, higher inflation.

‘And by the way, I wouldn’t take it off the table.’

On Wednesday, latest data from the Bureau of Labor Statistics revealed consumer prices were up 2.5 percent from a year earlier in August.

This is down from a 2.9 percent annual rate in July – and is the lowest rate of yearly price growth since February 2021.

This downward trend toward the Fed’s 2 percent inflation target paves the way for the central bank to cut interest rates at its next meeting on September 18.

This will bring benchmark borrowing costs down from a 23-year high and provide some relief for households.

But Dimon worries that there are still a raft of inflationary forces on the horizon, according to CNBC.

He pointed out that higher deficits and increased Government spending will add pressure to an economy still reeling from the impact of sustained higher interest rates.

‘They’re all inflationary, basically in the short run, the next couple of years,’ Dimon said.

‘So, it’s hard to look at [it] and say, “Well, no, we’re out of the woods.” I don’t think so.’

The Treasury Department announced Thursday that the US Government has spent more than $1 trillion this year on interest payments for the $35.3 trillion national debt.

This is the first time interest payments have crossed over this benchmark figure.

Jamie Dimon said this week ‘the worst income is stagflation,’ which he would not ‘take off the table’ for the US economy

 

The downward trend toward the Fed’s 2 percent inflation target paves the way for the central bank to cut interest rates at its next meeting on September 18 (Pictured: Federal Reserve Chair Jerome Powell)

 

Dimon has previously warned of an economic slowdown, saying that he would also not rule out a ‘hard landing’ for the US economy.

A ‘hard landing’ is when there is a marked economic slowdown following a period of rapid growth.

Other economists have predicted that the US is on track to stick a ‘soft landing’ – which has only happened once before.

This rare slowdown is when the rate of inflation returns to the Fed’s 2 percent target without triggering a recession.

Dimon, however, said in August that he thinks the odds of this happening are around 35 percent to 40 percent, CNBC reported, implying a recession is the more likely outcome.

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Jeremiah useini Abachas bossom friend is dead, the iroko of middle belt has fallen

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The news of the passing of General Sani Abacha’s close friend has sent shockwaves throughout the nation. This departed leader was not only a dear friend to General Useni but also a trusted ally and associate of the late Head of State, General Sani Abacha.

General Useni, a renowned military strategist and former Minister of the Federal Capital Territory, has lost a trusted confidant and partner in the corridors of power. The two shared a bond forged in the heat of battle and the intricacies of statecraft.

As a close associate of General Abacha, the late leader played a significant role in shaping the country’s history during a tumultuous period. His counsel and guidance were invaluable to General Abacha, and his passing marks the end of an era.

As the nation mourns the loss of this iconic leader, we offer our condolences to General Jeremiah Useni, his family, and the entire nation. May the soul of the departed rest in peace, and may his legacy continue to inspire future generations.

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EWI-IN-COUNCIL ORDERS SUSPENSION OF SHARI’AH ARBITRATION PANEL IN ADO EKITI

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The Ewi of Ado Ekiti, Oba Adeyemo Adejugbe, on Saturday, ordered the dissolution of the Sharia panel set up at the Central Mosque, Ado Ekiti in the interest of peaceful coexistence and law and order in the community.

Adejugbe spoke in Ado Ekiti during a meeting he held with the chiefs and indigenes of the community and the Chief Imam and President of the League of Imams and Alfas in the Southwest, Edo and Delta states, Sheik Jamiu Kewulere; and other Muslim leaders in Ado Ekiti over tension in some quarters over the sharia panel issue.

This came barely two days after the state government said that the existing legal structure in the state did not recognise the Sharia Court or Sharia Arbitration Panel.

The state Commissioner for Justice and Attorney General, Dayo Apata, (SAN) had spoken in reaction to news reports stipulating the first public sitting of a Shari’ah Panel in the state which resolved two marriage disputes.

He had said that the legal structure in Ekiti State (i.e. Customary Court, Customary Court of Appeal and High Court) had been handling issues relating to Islamic, Christian and traditional marriages and inheritance without any rancour or agitation.

Adejugbe said, “Based on this Sharia issue, I summoned the Chief Imam and his lieutenants, members of the Ewi-in-Council, the president of Ado Progressives Union and Ado sons and daughters to discuss the matter because it is a sensitive issue.

“We all listened and it appears they set up a committee at the Central Mosque with the intention to listen to disputes. According to them, they have good intentions and it was an internal arrangement that has nothing to do with any external person or somebody influencing them.

“I told them the mood of the nation will not allow such to happen now, that they should revert to how the founding fathers of the mosque had been settling disputes in the past without setting up a committee.

“I told them that there is no need for the committee and they should dissolve the committee henceforth. That is the decision of the Ewi-in-Council and that is the position of all Ado sons and daughters.

“The panel stands dissolved. If we should allow such committees, the Christians too will want to set up committees in their various churches, the traditional worshippers too and before you know it, it will lead to crises.”

Speaking earlier, the Chief Imam, Kewulere, who confirmed setting up the committee, which he said had resolved a marriage dispute and adjourned on a second matter, dismissed all insinuations that it was set up for sinister motives.

Kewulere, who said that Muslims and adherents of other religions had been enjoying cordial relationships, said, “Basically, the committee is to look into matters of inheritance in the interest of our members.”

He dismissed insinuations that it was to create crisis and he dismissed any external influence or link.

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Agege LG seals popular Mosalasi Alhaja over leadership tussle

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Mr Egunjobi directed that the mosque be sealed to prevent breakdown of public peace and order.

The Agege Local Government Area of Lagos State has sealed a popular mosque called ‘Mosalasi Alhaja‘over a leadership dispute following the demise of the chief imam

The Executive Chairman of Agege Local Government, Ganiyu Egunjobi, issued the directive in a statement on Saturday.

The tension arose following a disagreement between the family of the late Chief Imam, Sheikh Habib Abdulmajid, and his deputy, Sheikh Mustapha Muktar.

Mr Egunjobi directed that the mosque be sealed to prevent breakdown of public peace and order.

He said that the order, which takes immediate effect, was also intended to avert conflict caused by rivalry within the Hausa community in the area.

The council chairman, who visited the mosque to ensure that his directive was obeyed, said that adequate security would be provided to ensure the area remained calm and peaceful.

He stated, however, that the parties involved in the conflict would be invited to a stakeholders’ meeting to resolve the leadership crisis and restore normality.

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