Has Private Credit Peaked? Dimon Warns It May Have.
We're also taking a look at what Tuesday's data on consumer prices means for the Fed, at Zohran Mamdani's meeting with top New York C.E.O.s and at the crypto industry's continued relief from Washington.
JPMorgan's private-credit worries
JPMorgan Chase's C.E.O., Jamie Dimon, has been fairly consistently skeptical when it comes to private credit, the nontraditional and less-regulated lending business that has been among Wall Street's hottest activities in recent years.
He kept up that concern on Tuesday, warning that such lending might be set for a decline. But he wouldn't completely shut the door on buying a provider of such loans as part of an effort to get back into the sector.
'You may have seen peak private credit,' Dimon told analysts on JPMorgan's earnings call with analysts on Tuesday, with the caveat, 'I don't know that.' When pressed by Mike Mayo, a banking analyst at Wells Fargo, he added: 'Well, I've mentioned that credit spreads are very low. It's grown dramatically over time, and you have to pay up a lot for it.'
In other words, private-credit firms are currently accepting relatively little return in exchange for taking on risk, and the industry has grown significantly in the past several years. At a taping of the 'Acquired' podcast at Radio City Music Hall later in the day, Dimon called private credit 'one place that people worry has unknown leverage.'
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5 hours ago
- Forbes
At JPMorganChase, AI Innovation Is An Operating Committee Mandate
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6 hours ago
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"While universal tariffs are foolish and a real economic negative, their real world bite is often muted." Fisher had previously forecast that enforcing tariffs would be incredibly difficult, and that we'd see significant difficulty in collecting them. He also opined that high tariffs would likely cause the black-market import business to soar. He appears to be right. "Through June, roughly 39% of estimated tariffs duties were actually collected - far less than many feared - owing to tariff enforcement's complexity," said Fisher. "Markets move on the gap between reality and expectations, and it's always bullish when reality settles in better than overly dour expectations." Fisher also pointed out that over 50% of imports aren't subject to tariffs. This isn't to say that the U.S. economy would be better off without tariffs in terms of growth, but only that the drag on the economy may not be as bad as originally feared. According to Yale Budget Lab, current tariffs are reducing U.S. GDP this year by about 0.8%. In short, the stock market priced in a worst-case outcome from tariffs, providing plenty of room for positive surprises. Anything less than terrible can be viewed as a win that may lift analysts expectations for revenue and profit growth - the lifeblood of stock market returns. Related: Legendary fund manager has blunt message on 'Big Beautiful Bill' The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
6 hours ago
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Why banks hold the key to the Genius Act's breakthrough for stablecoins
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