(DCNF)—Jamie Dimon, long-time CEO of JPMorgan Chase, criticized the Biden administration’s pause on new liquified natural gas (LNG) projects and gave a key warning about the future of the economy in a letter released Monday as a part of the company’s annual report.
Dimon emphasized the usefulness of LNG as a form of affordable energy for the U.S. and its allies, with the project pause increasing dependence on oil and coal and harming economic and geopolitical advantages, according to the statement. He also issued a warning for the economy that the current high rate of inflation could stick around for longer than expected, which would also mean that the Federal Reserve’s federal funds rate could remain elevated to suppress inflation amid high levels of government spending.
“Trade is realpolitik, and the recent cancellation of future liquified natural gas (LNG) projects is a good example of this fact,” Dimon said in the statement. “The projects were delayed mainly for political reasons — to pacify those who believe that gas is bad and that oil and gas projects should simply be stopped. This is not only wrong but also enormously naïve. One of the best ways to reduce CO2 for the next few decades is to use gas to replace coal. When oil and gas prices skyrocketed last winter, nations around the world — wealthy and very climate-conscious nations like France, Germany and the Netherlands, as well as lower-income nations like Indonesia, the Philippines and Vietnam that could not afford the higher cost — started to turn back to their coal plants.”
He also pointed out key global events that he believes threaten the U.S. economy and require Americans’ attention.
“It is important to note that the economy is being fueled by large amounts of government deficit spending and past stimulus,” Dimon said in the statement. “There is also a growing need for increased spending as we continue transitioning to a greener economy, restructuring global supply chains, boosting military expenditure and battling rising healthcare costs. This may lead to stickier inflation and higher rates than markets expect.”
The national debt is currently nearly $34.6 trillion as of April 4, according to the Treasury Department. In February, the federal government spent more than double what it took in, adding $296 billion to the national debt.
Prices have risen 18.5% since President Joe Biden took office in January 2021, most recently rising 3.2% year-over-year, far higher than the Fed’s target of 2%. In response, the federal funds rate had been placed in a range of 5.25% and 5.50%, the highest level in 23 years.
JPMorgan reported record profits in 2023 despite a crisis that rocked many medium and small banks, which was started by a bank run at Silicon Valley Bank. Following the collapse of First Republic Bank, JPMorgan purchased the bank’s assets.
JP Morgan CEO Jamie Dimon weighs in on the LNG pause in his Annual Shareholder letter
“The projects were delayed mainly for political reasons — to pacify those who believe that gas is bad and that oil and
gas projects should simply be stopped. This is not only wrong but also… pic.twitter.com/d3rLd9NbjA— Shaylyn Hynes (@ShayHynes) April 8, 2024
“There are downside risks to watch,” Dimon said in the statement. “Quantitative tightening is draining more than $900 billion in liquidity from the system annually — and we have never truly experienced the full effect of quantitative tightening on this scale. Plus the ongoing wars in Ukraine and the Middle East continue to have the potential to disrupt energy and food markets, migration, and military and economic relationships, in addition to their dreadful human cost. These significant and somewhat unprecedented forces cause us to remain cautious.”
JPMorgan declined to comment further to the Daily Caller News Foundation.