By Cindy Roberts
JPMorgan Chase & Co. Chairman Jamie Dimon
said the unwinding of central bank bond-buying programs is an
unprecedented challenge that may be more disruptive than people think.
“We’ve
never have had QE like this before, we’ve never had unwinding like this
before,” Dimon said at a conference in Paris Tuesday. “Obviously that
should say something to you about the risk that might mean, because
we’ve never lived with it before.”
Central banks led by the U.S. Federal Reserve
are preparing to reverse massive asset purchases made after the
financial crisis as their economies recover and interest rates rise. The
Fed alone has seen its bond portfolio swell to $4.5 trillion, an amount
it wants to reduce without roiling longer-term interest rates. Minutes
of the Fed’s June 13-14 meeting indicate policy makers want to begin the
balance-sheet process this year.
“When that happens of size or substance, it could be a little
more disruptive than people think,” Dimon said. “We act like we know
exactly how it’s going to happen and we don’t.”
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Source: Bloomberg Markets (via The Empire Report)
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