If President Donald Trump gets his way on credit cards, JPMorgan Chase CEO Jamie Dimon predicts chaos — but more on the streets of American towns than in the walls of his own bank.
“It would be an economic disaster,” Dimon said when asked about President Donald Trump’s proposed one-year 10% cap on credit card interest rates. “And I’m not making that up because of our business, we would survive it, by the way. In the worst case, you would have to have a drastic reduction of the credit card business.”
Speaking at the World Economic Forum in Davos, Switzerland, Dimon predicted that, if enacted, the cap could strip credit from 80% of Americans. Dimon proposed that the government test the proposal by forcing all the banks in Vermont and Massachusetts to comply, “and then see what happens,” causing a ripple of laughter through the audience.
“The people crying most won’t be the credit card companies,” he said, adding that those hurt will include restaurants, retailers, travel companies, and municipalities, “because people will miss their water payments.”
Whatever the president and Congress decide, JPMorgan will “deal with it,” Dimon said. He promised that the bank would provide more extensive analysis of the potential effects, and said that he, too, wants greater affordability.
Dimon struck a largely conciliatory tone when asked about some of Trump’s geopolitical moves — immigration and NATO, for example — which he called “more qualitative, how it’s going to work, what are the pieces, what’s their intent.” But he said he understands the card issue deeply and has a responsibility, of sorts, to speak up.
Dimon, like many other big-bank CEOs and business leaders, has previously said that reducing card interest rates could harm customers with lower credit scores. JPMorgan’s CFO warned during the bank’s fourth-quarter earnings call last week that enacting price controls could “make it no longer a good business.”
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