Finance

SEC Chair Gary Gensler participates in a meeting of the Financial Stability Oversight Council at the U.S. Treasury in Washington, D.C., July 28, 2023.
Kevin Dietsch | etty Images

Securities and Exchange Commission Chair Gary Gensler is testifying before the House Financial Services Committee today. It will be very much like his testimony two weeks ago to the Senate Banking Committee: a forum for Republicans to attack Gensler for being overzealous and overreaching in his rulemaking proposals. 
Republicans are increasingly apoplectic about the more than 40 rules Gensler has been proposing, especially now that he has begun adopting them. 

That’s not new. Republicans have been critical of Gensler from the get-go. 
What’s different, nearly three years into the Biden administration, is that the financial services industry (hedge funds, mutual funds, market makers, trading firms, exchanges) are increasingly abandoning attempts to negotiate with Gensler and adopting a more confrontational stance. 
Some are suing him. 
“The industry (brokers and exchanges alike) are left with the only remaining tool at their disposal – a tool of last resort — litigation against the Commission,” Kirsten Wegner, CEO of the Modern Markets Initiative, wrote in a recent editorial in Trader’s Magazine. 
The complaints from the industry have been mounting for over a year: too many rules. No time for industry input. No roundtable discussions. No sharing of data used to make the policy decisions. 

The tone of the industry commentary toward Gensler has become increasingly hostile and bitter: “”Comment letters’ are a facade because it is all but impossible for the market to digest, process and respond to thousands of pages of draft regulation in only a few months’ time, and regardless, their points are often dismissed without meaningful study or explanation,” Wegner wrote.
Litigation starts 
Last month, Grayscale Bitcoin Trust, which is seeking to convert to a bitcoin ETF, successfully sued the SEC on the grounds that it had already approved a “similar” product in bitcoin futures and its actions were arbitrary and capricious. The SEC is weighing an appeal. 
Now that Gensler has adopted several of the rules that had been in the proposal stage, the industry has begun to take a more litigious stance. 
For example, six financial trade associations this month sued the SEC over its new Private Funds Adviser Rule, which requires registered private fund advisers to undergo an annual financial statement audit. The trade associations claim the SEC exceeded its statutory authority and acted arbitrarily and capriciously.
Gensler also appears to be in open warfare with Virtu Financial, one of the world’s largest market makers.  The SEC recently sued Virtu, claiming it failed to provide measures to protect sensitive customer data, and for making materially false and misleading statements regarding information barriers to prevent the misuse of that information. 
These types of cases would normally result in a quiet settlement, but that doesn’t appear likely. 
Virtu claims that this suit was an “escalation” of a years-long investigation because Virtu CEO Doug Cifu has been openly critical of the SEC’s market structure rule proposals, which have yet to be adopted. 
“Unfortunately, the SEC’s position appears to be driven by politics and headlines rather than the facts and the law,” Cifu said in a recent statement. “Therefore, under these circumstances, we look forward to vigorously defending ourselves in court against these meritless allegations while maintaining our focus on serving clients and markets globally and creating long-term value for our shareholders.” 
Gensler grilled for proposed and adopted rules 
Republicans will be particularly keen to talk about some of the bigger issues Gensler has been tackling. 
Take Climate-Related Disclosures, which were proposed in March 2022 but have not been adopted yet. They would require publicly-traded companies to disclose detailed emissions data and climate risk management strategies, including direct and indirect greenhouse gas emissions from their supply chains.  Republicans have claimed this is beyond the SEC’s mandate. Gensler, in his prepared testimony, says the SEC “has no role as to climate risk itself. We, however, do have an important role in helping to ensure that public companies make full, fair, and truthful disclosure about the material risks they face.” 
Other rules that have been adopted (like cybersecurity, which mandates disclosure of a cybersecurity incident within four business days after a company determines the incident is material) will again be attacked for overreaching. 
Then there’s crypto. Gensler has brought numerous enforcement actions against crypto intermediaries on the grounds that the tokens they offer are securities. Republicans will again attack him for over-reaching. 
And what about that bitcoin ETF lawsuit? Gensler made it clear he “will not be able to comment on any active, ongoing litigation.” Translation: don’t ask about the bitcoin ETF lawsuit. 
What’s next? 
By now, it’s clear Gensler is not backing down and will continue passing new rules because he has a 3-2 majority at the commission. 
Gensler will repeat that he is being reasonable and listening to industry complaints. On the climate change proposal, for example, Gensler noted that the SEC has received more than 15,000 comments and that it “will consider adjustments to the proposed rule that the staff, and ultimately the Commission, think are appropriate in light of those comments.” 
Given what has happened already, that will not mollify the critics. 
Some are hoping that a few Democrats will join the Republicans and ask Gensler to slow down. Last year, a dozen Senate Democrats did just that, sending a letter to Gensler urging him to extend the deadlines for proposed rules and to provide a sufficient period for notice and comment.  
But given the head of steam Gensler has worked up, that too is unlikely to sway him much. 
Now that he has begun adopting many of these rules, the financial services industry seems to be saying, “See you in court.” More

The world’s largest economy is once again facing the prospect of a government shutdown unless lawmakers in Washington can pass a spending bill before an Oct. 1 deadline.
S&P downgraded the long-term credit rating from AAA representing a “risk free” rating to AA+ as early as 2011, citing political polarization after a debt ceiling squabble in Washington.

Washington, D.C. – March 17, 2023: President Joe Biden and House Speaker Kevin McCarthy speak outside the Annual Friends of Ireland Luncheon at the U.S. Capitol.
Drew Angerer | Getty Images News | Getty Images

The U.S. is in a weaker position now than when S&P downgraded its sovereign credit rating in 2011, according to the former chairman of the agency’s sovereign rating committee.
The world’s largest economy is once again facing the prospect of a government shutdown unless lawmakers in Washington can pass a spending bill before an Oct. 1 deadline.

House Speaker Kevin McCarthy cannot afford to lose more than four votes among fellow Republicans in the House of Representatives, but faces resistance from hard-right members within his caucus, who are demanding deeper domestic spending cuts.
Moody’s earlier this week warned that a government shutdown would harm the country’s credit, after Fitch downgraded the long-term U.S. sovereign credit rating by one notch in August on the back of the latest political standoff over raising the debt ceiling.
S&P controversially downgraded the long-term credit rating from AAA representing a “risk free” rating to AA+ as early as 2011, citing political polarization after another debt ceiling squabble in Washington.
John Chambers, former chairman of the Sovereign Rating Committee at S&P Global Ratings at the time of that 2011 downgrade, told CNBC’s “Capital Connection” on Tuesday that a government shutdown is likely and that the whole episode was a “sign of weak governance.”
This was a factor that led to S&P’s downgrade of 2011, and Chambers said the U.S. fiscal position is now even weaker than it was back then.

“Right now the deficit of the general government — which is the federal and the local governments combined — is over 7% of GDP and the government debt is 120% of GDP. At the time, we forecasted that it might get to 100% of GDP, and the government ridiculed us for being too scaremongering,” he said.

“The external position is about the same, but I think the governance has weakened and the fractiousness of the political settings is much worse, and that has led to government shutdowns, it’s led to fears that the government might default on its debt because of the debt ceiling, and it’s led to a failed coup d’état on the 6th [of] January, 2021.”
House Speaker McCarthy needs almost all of his Republican colleagues on the side, but the Freedom Caucus, which had 49 members in January, has stalled budget negotiations by demanding harsher domestic spending cuts.
McCarthy may seek help from Democrats to shore up the necessary votes to avoid a shutdown, but hard-line Republicans have discussed ousting him as speaker if such a compromise is agreed.
In May of this year, another standoff between the White House and opposition Republicans over raising the U.S. debt limit once again pushed the world’s largest economy to the brink of defaulting on its bills, before President Joe Biden and McCarthy struck a last-minute deal.
In its August downgrade, Fitch cited “expected fiscal deterioration over the next three years” and an erosion of governance in light of “repeated debt-limit political standoffs and last-minute resolutions.”
However, the downgrade was dismissed by many big-name bank bosses and economists as largely immaterial. More

The Levi Strauss & Co. label is seen on jeans in a store at the Woodbury Common Premium Outlets in Central Valley, New York, U.S., February 15, 2022. 
Andrew Kelly | Reuters

Check out the companies making headlines in premarket trading.
Sirius XM — Shares of the media company fell roughly 2% in premarket trading. A day earlier, Liberty Media proposed combining the Sirius XM tracking stock with the radio company. A special committee composed of board members of Sirius XM is currently considering the proposal.

Levi Strauss — The apparel maker advanced 1.3% in premarket trading after TD Cowen initiated coverage of the stock at an outperform rating. TD Cowen said Levi’s is in the “early innings of a favorable denim cycle.”
Costco — Shares of the club retailer fell more than 1% even though Costco’s fiscal fourth-quarter response came in better than expected. The company generated $4.86 in earnings per share on $78.9 billion of revenue. Analysts surveyed by LSEG were looking for $4.79 per share on $77.9 billion of revenue. Comparable sales were up just 0.2% in the U.S., however.
ChargePoint – The electric vehicle charging stock popped more than 4% after UBS initiated coverage of ChargePoint with a buy rating, saying that the recent stock performance creates an attractive risk-reward.
XPO — The trucking company climbed about 2% following an upgrade to outperform from Evercore ISI. Analyst Jonathan Chappell forecast greater margin expansion and pricing power from the company.
Lucid, Rivian —- Shares of the electric vehicle makers ticked up 2.1% and 2%, respectively. Both stocks rose a day earlier as the United Auto Workers strike deepened and garnered support from President Joe Biden, who joined a picket line in Michigan.

Mattel — Shares of the toymaker gained 2.4% in premarket trading Wednesday after Morgan Stanley initiated Mattel with an overweight rating, calling it a top pick. The firm said Mattel offers some of the best risk-adjusted returns despite a tough macroeconomic environment.
— CNBC’s Alex Harring, Jesse Pound, Samantha Subin and Pia Singh contributed reporting More

Improbable, which is backed by SoftBank, recorded a loss of £19 million in the 2022 fiscal year, down more than 85% from the £131 million loss it posted a year prior.
Improbable said that a part of the reason behind the company’s reduction in losses was a dramatic lowering of costs for running mass-scale virtual events.
Founded in 2012, Improbable has for years been attempting to build vast, continuously rendering worlds in which thousands of people can play games and interact with each other.

Herman Narula, co-founder and CEO at Improbable, speaks during a session at the Web Summit in Lisbon.
Henrique Casinhas | Sopa Images | Lightrocket | Getty Images

Virtual reality startup Improbable said Wednesday that it reduced losses by 85% in 2022, a year that saw the company pivot its focus to powering new “metaverse” experiences.
The British company said in a press release that its revenues more than doubled last year to £78 million ($95 million), as its work on metaverses expanded significantly.

It reduced losses in the 2022 fiscal year by £131 million to £19 million.
Improbable CEO Herman Narula said the company had reported its “best financial year” on record which reflected how its bet on the metaverse had paid off.
Speaking with CNBC in an interview Tuesday, Narula said Improbable has managed to ship more products with fewer people thanks to advances in generative artificial intelligence. Coders in the company are using generative AI “daily” to write code and come up with solutions to business problems, he said.
“We’re starting to think that the model of a successful tech company in 2023 … the optimal size is probably not that big,” Narula told CNBC. “You probably want to be thinking about much smaller companies overall.
One driver for downsizing tech firms beyond generative AI, according to Narula, is remote work, which he said has made it “harder to motivate a group of people, especially if those people feel distant from management.”

“You’re really looking at a world where we’re moving from big battleships down to swarms of very nimble entities,” he added.
“It gives me a lot of hope that companies like ours have a shot at becoming really successful because we don’t have to adopt the same tactics [Big Tech companies like Microsoft and Meta] had to, such as hiring tens of thousands of people.”
Improbable has historically burned through lots of money as it attempts to make its vision for vast virtual worlds a success. Critics have raised questions about the commercial sustainability of the business.
Improbable said that part of the reason behind the company’s reduction in losses was a dramatic reduction in the cost of running mass-scale virtual events.
Whereas initially it took millions of pounds to host one event, it now takes hundreds of thousands of pounds, the company said, and it anticipates this to continue to fall.
The year also saw Improbable divest two of its games studios, Inflexion Games and Midwinter Entertainment, and sell off a business unit focused on servicing defense clients.
Improbable finished the year with £140 million cash in the bank, signaling ongoing support from shareholders, the company said.
Improbable’s backers include the likes of SoftBank, Andreessen Horowitz, and Temasek.
Full accounts for Improbable are yet to be released on Companies House, the U.K.’s official register of companies.

Metaverse pivot

In 2022, Improbable unveiled its ambition to become a major player in the so-called “metaverse” — the concept for a vast world, or worlds, in the digital sphere where people can work, buy and sell things, or just hang out.
The company has been working with players in the digital asset sphere, including Yuga Labs, which it worked with to build out the Otherside metaverse, where people can make their own digital avatars, attend events, and more.
The company doubled down on its metaverse strategy earlier this year with a white paper detailing its vision for MSquared, a “network of interoperable Web3 metaverses.”
MSquared, which is a separate business entity from Improbable, raised $150 million from investors last year.
The service — a complex piece of technical engineering with significant computing requirements — is intended to be accessible via cloud streaming, meaning you won’t have to download any software to jump into one of its worlds, similar to how movies and TV shows are accessed on Netflix. 
It’s drawn interest from big names in sports and entertainment, like Major League Baseball (MLB).
The company struck a major deal with MLB to launch a new virtual ballpark based on Improbable’s metaverse technology. People in the MLB metaverse can choose any seat they’d like to watch a game, or pick a camera spot to focus on a particular player.
The tech industry has been betting that virtual and augmented reality will prove to be something of a “paradigm” shift in technology akin to the invention of the internet or the smartphone.
Some are calling it the technology’s “iPhone moment,” in reference to effect Apple’s now ubiquitous handset had on consumers and businesses globally.
Apple recently announced its first virtual and augmented reality headset, called the Vision Pro, while Meta unveiled its Quest 3 headset in June. 
Improbable is taking a different route to companies like Apple, Meta, and Microsoft, which is behind the HoloLens mixed reality products.
For one, you won’t need a headset to enter an MSquared space, as the software will be desktop-based. The experience is also intended to be more decentralized and interoperable, with the ability to take content from one metaverse to another.
Founded in 2012, Improbable has for years been attempting to build vast, continuously rendering worlds in which thousands of people can play games and interact with each other.
The London-headquartered firm, one of Japanese tech investment giant SoftBank’s biggest bets in Britain, was founded by Cambridge computer science students Narula and Rob Whitehead with the ambition of developing large-scale computer simulations and “synthetic environments.” More

A customer uses an ATM at a Wells Fargo Bank in San Bruno, California, on April 14, 2023.
Justin Sullivan | Getty Images

Check out the companies making headlines in midday trading.
Cintas — Shares fell 5.3% after the company reported its 2024 fiscal first-quarter earnings. The corporate apparel company posted $3.70 in earnings per share on $2.34 billion in revenue, topping analysts’ consensus estimates of $3.67 per share in earnings and matching revenue forecasts, per StreetAccount. Cintas raised its full-year guidance but the lower end of its EPS and revenue predictions came in below analysts’ estimates.

Pinterest — Shares of the image-sharing platform declined 0.6% after HSBC initiated coverage of the stock with a buy rating. The Wall Street firm said Pinterest has “the right management team in place, a product fit for shopping and a differentiated capital-light strategy to deliver on its foray into social commerce.”
United Natural Foods — Shares sank 27.4% Tuesday after United Natural Foods forecast earnings per share and adjusted EBITDA in the coming year below analysts’ estimates, citing profitability headwinds. The food company’s guidance ranges between a loss of 88 cents per share to earnings of 38 cents per share, excluding items, while analysts called for $1.94 per share, according to StreetAccount. The company’s fiscal fourth-quarter revenue missed analysts’ $7.47 billion estimate.
Fisker — The electric vehicle maker climbed 9.6% after Bank of America initiated coverage of shares at a buy rating. The firm said the company offers pure-play exposure in a growing market.
Wells Fargo, JPMorgan, Goldman Sachs — Bank stocks declined Tuesday after JPMorgan Chase CEO Jamie Dimon warned the Federal Reserve could still raise interest rates even further to tamp down inflation, which added to overall bearish sentiment. Shares of Wells Fargo and Goldman Sachs declined 2.2% and 1.5%, respectively, while Morgan Stanley and JPMorgan both lost about 1%. 
SiriusXM — Shares of the media company slipped 3.2% following news of a proposal from Liberty Media to SiriusXM’s special committee of independent directors to combine the two corporate structures into one entity.

DraftKings — DraftKings’ shares jumped just above 2% after JPMorgan upgraded the sports betting stock to overweight from neutral, saying the company’s recent underperformance creates an attractive entry point for investors.
Barclays — U.S.-listed shares of the bank added 2.2% after Morgan Stanley upgraded Barclays to overweight from an equal weight rating, citing an improved revenue outlook and opportunity for U.S. credit card growth.
Amazon – Shares dropped 4% after the Federal Trade Commission and 17 state attorneys general sued Amazon on Tuesday, hitting the e-commerce retailer with antitrust charges. The suit alleges that Amazon uses its “monopoly power” to hike prices and prevent rivals from competing against it.
— CNBC’s Hakyung Kim, Alex Harring, Brian Evans, Samantha Subin and Yun Li contributed reporting. More

Minneapolis Fed President Neel Kashkari thinks there’s nearly a 50-50 chance that interest rates will need to move significantly higher to bring down inflation.
In an essay posted Tuesday, the central bank official said the U.S. could be headed for a “high-pressure equilibrium” in which inflation stays elevated and requires “potentially meaningfully higher” rates.

Neel Kashkari, President and CEO of the Federal Reserve Bank of Minneapolis, attends an interview with Reuters in New York City, New York, U.S., May 22, 2023. 
Mike Segar | Reuters

Minneapolis Federal Reserve President Neel Kashkari thinks there’s nearly a 50-50 chance that interest rates will need to move significantly higher to bring down inflation.
In an essay the central bank official posted Tuesday, he said there’s a strong case to be made that the U.S. economy is headed toward a “high-pressure equilibrium.” Such a condition would involve continued growth featuring strong consumer spending and “the economic flywheel spinning.”

In that instance, the inflation rate falls but stays above the Fed’s 2% target, posing a challenge for policymakers.
“The case supporting this scenario is that most of the disinflationary gains we have observed to date have been due to supply-side factors, such as workers reentering the labor force and supply chains resolving, rather than monetary policy restraining demand,” he wrote in a post titled, “Policy Has Tightened a Lot. Is It Enough?”
Noting that rate-sensitive areas such as housing and autos have held strong despite Fed tightening, Kashkari remarked, “These dynamics raise the question, How tight is policy right now? If policy were truly tight, would we observe such robust activity?”
Services inflation, excluding the cost of renting shelter, has been coming down, but has otherwise remained elevated, raising longer-term concerns.

“Once supply factors have fully recovered, is policy tight enough to complete the job of bringing services inflation back to target? It might not be, in which case we would have to push the federal funds rate higher, potentially meaningfully higher,” Kashkari said. “Today I put a 40 percent probability on this scenario.”

Of course, that still means he assigns a 60% chance of the Fed sticking its “soft-landing” goal, with inflation coming back to the goal without a harmful recession. He cited “the actual progress we have made against inflation and the actual labor market performance” as factors contributing to policymakers reaching their goal.
However, the comments come the same day as The Times of India published an interview with JPMorgan Chase CEO Jamie Dimon, in which the bank executive entertains the possibility that the Fed may have to take its benchmark rate up to 7%. The fed funds rate currently is targeted in a range between 5.25%-5.5%.
Several other Fed officials recently have stated they, at the least, expect to keep rates elevated for a prolonged period of time.
For his part, Kashkari had long been known as one of the more dovish members of the rate-setting Federal Open Market Committee, meaning he favors lower interest rates and looser monetary policy.
However, in recent months he has switched to a more hawkish stance as he worries about the dynamics that are keeping inflation above target. Kashkari this year is a voting member of the FOMC, which last week decided to hold rates steady while indicating another quarter-point hike could be on the way before the end of the year.
While acknowledging the progress made so far — as well as market and consumer expectations that the inflation rate will keep falling — Kashkari said the neutral rate of interest may have risen in the current era, requiring tighter policy. More

JPMorgan’s U.K. digital bank Chase UK said in a statement Tuesday that, starting Oct. 16, customers would “no longer be able to make crypto transactions via debit card or by outgoing bank transfer.”
The company said it was taking the step because “fraudsters are increasingly using crypto assets to steal large sums of money from people.”
It follows similar moves from other banks in the U.K. to restrict transactions involvement cryptocurrencies, as lenders look to prevent their customers from becoming victims to fraud.

Signage outside a Chase bank branch in San Francisco, California, on Monday, July 12, 2021.
David Paul Morris | Bloomberg | Getty Images

Chase UK, the British challenger bank brand of JPMorgan, has blocked customers in the U.K. from purchasing crypto assets.
The company said in a statement Tuesday that, starting Oct. 16, Chase UK customers would “no longer be able to make crypto transactions via debit card or by outgoing bank transfer.”

“Customers will receive a declined transaction notification if they do attempt to make a crypto-related transaction,” the bank said in an email to clients.
“This has been done to protect our customers and keep their money safe.”
The company said it was taking the step because “fraudsters are increasingly using crypto assets to steal large sums of money from people.”
Chase UK cited data from Action Fraud, Britain’s fraud reporting agency, that showed U.K consumer losses to crypto fraud increased by over 40% in the last year, surpassing £300 million for the first time.
Crypto scams accounted for more than 40% of all reported crimes in England and Wales last year, according to the Office for National Statistics, Chase UK said in the customer email.

Chase UK is the latest bank in the country to take steps to limit the ability of their customers to purchase cryptocurrencies.
NatWest imposed limits on its customers which meant they could only send a maximum of £1,000 per day and £5,000 over a 30-day period to crypto exchanges, in an effort to tackle the rise in fraud attempts involving crypto.
HSBC and Nationwide have announced similar restrictions on crypto-linked purchases.
“We’re committed to helping keep our customers’ money safe and secure,” a Chase spokesperson told CNBC via email Tuesday.
“We’ve seen an increase in the number of crypto scams targeting U.K. consumers, so we have taken the decision to prevent the purchase of crypto assets on a Chase debit card or by transferring money to a crypto site from a Chase account.” 
WATCH: Crypto enthusiasts want to reshape the internet with ‘Web3.’ Here’s what that means More

Dimon suggested that Eastern Europe was the epicenter of risk, with the war in Ukraine straining relationships between economic superpowers.
“We have dealt with inflation before, we dealt with deficits before, we have dealt with recessions before, and we haven’t really seen something like this pretty much since World War II,” Dimon said.

Jamie Dimon, Chairman of the Board and Chief Executive Officer of JPMorgan Chase & Co., gestures as he speaks during an interview with Reuters in Miami, Florida, U.S., February 8, 2023. 
Marco Bello | Reuters

JPMorgan Chase CEO Jamie Dimon says geopolitics after Russia’s invasion in Ukraine is the biggest risk, larger than high inflation or a U.S. recession.
Global markets have taken a hit over the past week, as the U.S. Federal Reserve signaled that interest rates will likely remain higher for longer, in order to bring inflation sustainably back down to its 2% target.

Speaking to CNBC TV-18 in India on Tuesday, Dimon said people should “be prepared for higher oil and gas prices, higher rates, as a matter of just being prepared,” but that the U.S. economy will likely get through any turbulence. However, the war in Ukraine has polarized global powers and shows no sign of abating.
“I think the geopolitical situation is the thing that most concerns me, and we don’t know the effect of that in the economy,” he added.
“I think that the humanitarian part is far more important. I think it’s also very important for the future of the free democratic world. We may be at an inflection point for the free democratic world. That’s how seriously I take it.”
Further negative pressure on markets in recent months has come from a slowdown in the Chinese economy, driven in large part by weakness in its massive property market.
Asked about the potential impact of this slump on the long-term prospects for China and the global economy, Dimon again suggested that Eastern Europe was the actual epicenter of risk, with the war in Ukraine straining relationships between economic superpowers.

“Far more important to me is the Ukraine war, oil, gas, food migration — it’s affecting all global relationships — very importantly, the one between America and China,” Dimon said.
“I think America takes this very seriously, I’m not quite sure how the rest of the world does. You have a European democratic nation invaded under the threat of nuclear blackmail. I think it’s been a good response, but it’s going to affect all of our relationships until somehow the war is resolved.”
China and India have attempted to maintain a neutral stance on the war and position themselves as potential peacemakers, utilizing the closer ties with Russia demonstrated by the BRICS alliance. Beijing has submitted a peace plan proposal to resolve the conflict in Ukraine, which has so far failed to gain traction.
This placed the world’s two most populous countries somewhat at odds with the U.S. and Europe, which have supplied Ukraine with weapons and financial support in the belief that only a Ukrainian victory will restore international order.
“India is going its own way. They’ve made their priorities quite clear about national security and what that means,” Dimon said.
“I’m an American patriot, so governments are going to set foreign policy, not JPMorgan, but I think Americans should stop thinking that China is a 10-foot giant. Our GDP per person is $80,000, we have all the food, water and energy we need, we’ve got the unbelievable benefits of free enterprise and freedom.”

The Wall Street titan added that renewed U.S. engagement with China on issues such as trade and national security was positive, and that he would like to see more of it to rebalance the trade and investment relationship between Washington and Beijing, even if that caused a “little bit of unravelling.”
“But it’s not just America, every country is relooking at its net. What is national security? Do I have reliant energy lines? Do I need semiconductors from China? Where do I get my rare earths from? Ukraine woke everyone up to that and that’s a permanent state of affairs now,” Dimon said.
Asked if geopolitics was the No. 1 risk facing the world today, Dimon responded, “absolutely.”
“We have dealt with inflation before, we dealt with deficits before, we have dealt with recessions before, and we haven’t really seen something like this pretty much since World War II,” he added. More