Latest news with #ReaganNationalEconomicForum
Yahoo
09-06-2025
- Business
- Yahoo
Wall Street's Elite Get Serious About Debt Alarmism
The US has been racking up budget deficits for most of the past half-century, but the leader of the country's largest bank by assets and the head of the world's largest asset manager think enough is enough. JPMorgan CEO Jamie Dimon and BlackRock CEO Larry Fink were the leading voices in a chorus of billionaires who sounded off last week about higher deficit spending in the US. The resulting mountain of debt could soon rival Denali (the highest US peak), leading to concerns that interest expenses will engulf federal spending, which will drag down growth, which in turn will drag down everything else. READ ALSO: Ripped Job Market Swipes Left on New Grads and Consumer Goods Giants Slim Down to Spur Growth The worries start in the bond market, which Dimon warned could 'crack' during May 30 remarks to the Reagan National Economic Forum. The long-term yields in America's $29 trillion Treasurys market have flirted with 5% in recent weeks, with the 30-year yield at 4.963% on Friday. That has made for the highest levels since 2023. The yield on the 10-year Treasury note, meanwhile, has risen to 4.51% from below 3.7% in September. Higher yields mean the government generally has to pay higher interest to bond investors, who are fewer and increasingly less inclined to offer cheap, long-term funding to finance the nation's debt, hence Dimon's prediction of a 'crack.' US deficit spending, which is at 120% of GDP, according to the Federal Reserve Bank of St. Louis, is set to balloon under the 'big, beautiful' Trump-backed GOP spending bill in Congress. The Committee for a Responsible Federal Budget estimates the bill would add $3.3 trillion to the $36.2 trillion US debt by 2034. That means more interest payments, which are already eating up federal spending: The $892 billion in interest payments on the debt equaled approximately 13% of the total federal budget in 2024, according to the Center on Budget and Policy Priorities, leapfrogging what is spent on Medicare or defense. None of this, Dimon, Fink and others are warning, is ideal: 'If people decide that the US dollar isn't the place to be, you could see credit spreads gap out; that would be quite a problem,' Dimon told Fox Business last week, alluding to the greenback's 9% decline this year, an indication foreign investors have become less interested in US assets. 'It hurts the people raising money. That includes small businesses, that includes loans to small businesses, includes high-yield debt, includes leveraged lending, includes real estate loans. That's why you should worry about volatility in the bond market.' Fink, citing the GOP spending plan, warned a Forbes conference in New York last week that if US economic growth continues 'to stumble along at a 2%' rate, deficits will overwhelm the country and 'we're going to hit the wall.' Citadel founder Ken Griffin, speaking at the same conference, offered his own two cents: running a deficit of 6 or 7 percent of GDP with full employment was 'just fiscally irresponsible' (Moody's cautioned that the bill will push the deficit from 6.4% of GDP in 2024 to nearly 9% by 2035). Problem Solver: Treasury Secretary Scott Bessent dismissed Dimon's concern about the bond market. 'He's made predictions like this' before, Bessent said. 'Fortunately, none of them have come true.' Dimon, who told the Reagan Forum he doesn't know 'if it's going to be a crisis in six months or six years,' was insistent but offered a way to ward off his prediction: 'Change the trajectory of the debt' and relax rules on banks' engaging in bond trading, allowing them to provide more financing if markets freeze up. This post first appeared on The Daily Upside. To receive delivering razor sharp analysis and perspective on all things finance, economics, and markets, subscribe to our free The Daily Upside newsletter. Sign in to access your portfolio
CNBC
05-06-2025
- Business
- CNBC
Andreessen Horowitz partner Katherine Boyle on bringing innovation to government
Katherine Boyle of Andreessen Horowitz sat down with Morgan Brennan at the Reagan National Economic Forum to discuss the impacts of DOGE and the importance of modernizing the U.S. military.
Economist
05-06-2025
- Business
- Economist
The man behind Trump's first tax cuts assesses the second
As a registered Democrat, Gary Cohn was an unexpected pick for Donald Trump's chief economic adviser in 2017. He came on a mission to slash taxes, but left during the president's first tariff war. Eight years later we interview Mr Cohn at the Reagan National Economic Forum, getting his take on the more-radical 'Liberation Day' tariffs and the 'Big Beautiful Bill' that would make permanent the tax cuts he crafted. Hosts: Mike Bird and Alice Fulwood. Guest: Gary Cohn, former director of America's National Economic Council under Donald Trump and former president of Goldman Sachs. Recorded at the Reagan National Economic Forum. Listen to what matters most, from global politics and business to science and technology—subscribe to Economist
Yahoo
03-06-2025
- Business
- Yahoo
JPMorgan's Jamie Dimon is getting louder about his US debt worries
JPMorgan Chase (JPM) CEO Jamie Dimon is increasingly concerned that the US government's surging debt is going to cause problems for the bond market, prompting some pushback from Treasury Secretary Scott Bessent. Last Friday, the boss of the biggest US bank predicted a "crack" in that market while speaking at the Reagan National Economic Forum in Simi Valley, Calif. "It is going to happen. And I tell this to my regulators, some of you who are in this room, I'm telling you it's going to happen, and you're going to panic." This past weekend, Bessent dismissed that prediction, saying Dimon has made it before. "I've known Jamie a long time and for his entire career he's made predictions like this. Fortunately, none of them have come true. That's why he's a banker, a great banker. He tries to look around the corner," Bessent said in an interview on CBS' "Face the Nation." Dimon emerged in 2025 as an influential voice when it comes to the policies of the new Trump administration — and as someone who apparently has President Trump's ear. The president even acknowledged listening to Dimon just hours before he announced a 90-day pause of his "Liberation Day" tariffs on April 9. Dimon repeated his warnings about the bond market in an interview with Fox Business Network's Maria Bartiromo that aired Monday, saying the surging US national debt may create a "tough time" for that market as spreads widen. "If people decide that the US dollar isn't the place to be, you could see credit spreads gap out; that would be quite a problem," Dimon said. "It hurts the people raising money. That includes small businesses, that includes loans to small businesses, includes high-yield debt, includes leveraged lending, includes real estate loans. That's why you should worry about volatility in the bond market." Long-term Treasury yields have been climbing in recent weeks, driven by growing concerns over the trajectory of US debt as President Trump's proposed tax legislation advances to the Senate after clearing the House. Read more: What is the 10-year Treasury note, and how does it affect your finances? New concerns emerged last week after a Manhattan-based trade court struck down a wide swath of Trump's tariffs, citing legal issues with how they were implemented. Although a federal appeals court paused that decision on Thursday, temporarily allowing the tariffs to remain in place, the legal back-and-forth has added to market uncertainty. Treasury yields initially spiked on Monday, with the 10-year (^TNX) climbing to 4.46% while the 30-year (^TYX) reached 4.99% by the end of the day. They briefly retreated on Tuesday, only to return to Monday levels, a threshold breached only a handful of times since 2007. Bessent told CBS this past weekend that the administration's work on getting down the deficit is underway. "The deficit this year is going to be lower than the deficit last year, and in two years it will be lower again," he said. "We are going to bring the deficit down slowly. We didn't get here in one year, and this has been a long process." The administration intends to "leave the country in great shape in 2028," he added. One area that would cushion a bond market tantrum that the Trump administration has clearly telegraphed is giving JPMorgan and other big banks a larger role as US Treasury holders, and possibly dealers. Bessent has repeatedly said he wants to adjust a bank capital requirement known as the supplemental leverage ratio (SLR) to make it easier for lenders in order to inject more liquidity into the market for US government debt. Dimon agrees that amending the SLR would help the market during times of stress, though he noted that he also wants to see reforms across lots of capital requirements. "The reason to change some of these things is so banks — the big market makers could intermediate more in the markets," Dimon told analysts in April. "If they do, spreads will come in, there'll be more active traders," Dimon said. "If they don't, the Fed will have to intermediate, which I think is just a bad policy idea that every time there's a kerfuffle in the markets, the Fed has to come in and intermediate." To prevent a bond market crack, Dimon said in the Fox News interview that aired Monday, "the real focus should be [economic] growth." He also named several places for improvement from regulatory, permitting, and education reforms to broader government efficiency efforts meant to stamp out waste and fraud in Medicare and Medicaid. Dimon gave Fox an update about his plans to leave the bank eventually, saying that his retirement is still "several years away" but that "it's up to God and the board," the 69-year-old CEO said. "I love what I do." On Tuesday, the bank announced in a memo that it was giving more responsibility to one of Dimon's potential successors, consumer bank boss Marianne Lake. Lake will also oversee strategic growth and the overseas consumer bank following Sanoke Viswanathan's departure to become CEO of data provider FactSet. David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance. Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
03-06-2025
- Business
- Yahoo
JPMorgan's Jamie Dimon is getting louder about his US debt worries
JPMorgan Chase (JPM) CEO Jamie Dimon is increasingly concerned that the US government's surging debt is going to cause problems for the bond market, prompting some pushback from Treasury Secretary Scott Bessent. Last Friday, the boss of the biggest US bank predicted a "crack" in that market while speaking at the Reagan National Economic Forum in Simi Valley, Calif. "It is going to happen. And I tell this to my regulators, some of you who are in this room, I'm telling you it's going to happen, and you're going to panic." This past weekend, Bessent dismissed that prediction, saying Dimon has made it before. "I've known Jamie a long time and for his entire career he's made predictions like this. Fortunately, none of them have come true. That's why he's a banker, a great banker. He tries to look around the corner," Bessent said in an interview on CBS' "Face the Nation." Dimon emerged in 2025 as an influential voice when it comes to the policies of the new Trump administration — and as someone who apparently has President Trump's ear. The president even acknowledged listening to Dimon just hours before he announced a 90-day pause of his "Liberation Day" tariffs on April 9. Dimon repeated his warnings about the bond market in an interview with Fox Business Network's Maria Bartiromo that aired Monday, saying the surging US national debt may create a "tough time" for that market as spreads widen. "If people decide that the US dollar isn't the place to be, you could see credit spreads gap out; that would be quite a problem," Dimon said. "It hurts the people raising money. That includes small businesses, that includes loans to small businesses, includes high-yield debt, includes leveraged lending, includes real estate loans. That's why you should worry about volatility in the bond market." Long-term Treasury yields have been climbing in recent weeks, driven by growing concerns over the trajectory of US debt as President Trump's proposed tax legislation advances to the Senate after clearing the House. Read more: What is the 10-year Treasury note, and how does it affect your finances? New concerns emerged last week after a Manhattan-based trade court struck down a wide swath of Trump's tariffs, citing legal issues with how they were implemented. Although a federal appeals court paused that decision on Thursday, temporarily allowing the tariffs to remain in place, the legal back-and-forth has added to market uncertainty. Treasury yields initially spiked on Monday, with the 10-year (^TNX) climbing to 4.46% while the 30-year (^TYX) reached 4.99% by the end of the day. They briefly retreated on Tuesday, only to return to Monday levels, a threshold breached only a handful of times since 2007. Bessent told CBS this past weekend that the administration's work on getting down the deficit is underway. "The deficit this year is going to be lower than the deficit last year, and in two years it will be lower again," he said. "We are going to bring the deficit down slowly. We didn't get here in one year, and this has been a long process." The administration intends to "leave the country in great shape in 2028," he added. One area that would cushion a bond market tantrum that the Trump administration has clearly telegraphed is giving JPMorgan and other big banks a larger role as US Treasury holders, and possibly dealers. Bessent has repeatedly said he wants to adjust a bank capital requirement known as the supplemental leverage ratio (SLR) to make it easier for lenders in order to inject more liquidity into the market for US government debt. Dimon agrees that amending the SLR would help the market during times of stress, though he noted that he also wants to see reforms across lots of capital requirements. "The reason to change some of these things is so banks — the big market makers could intermediate more in the markets," Dimon told analysts in April. "If they do, spreads will come in, there'll be more active traders," Dimon said. "If they don't, the Fed will have to intermediate, which I think is just a bad policy idea that every time there's a kerfuffle in the markets, the Fed has to come in and intermediate." To prevent a bond market crack, Dimon said in the Fox News interview that aired Monday, "the real focus should be [economic] growth." He also named several places for improvement from regulatory, permitting, and education reforms to broader government efficiency efforts meant to stamp out waste and fraud in Medicare and Medicaid. Dimon gave Fox an update about his plans to leave the bank eventually, saying that his retirement is still "several years away" but that "it's up to God and the board," the 69-year-old CEO said. "I love what I do." On Tuesday, the bank announced in a memo that it was giving more responsibility to one of Dimon's potential successors, consumer bank boss Marianne Lake. Lake will also oversee strategic growth and the overseas consumer bank following Sanoke Viswanathan's departure to become CEO of data provider FactSet. David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance. Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
