"The king of Wall Street" issues a new warning: Stock valuations in the US may be "slightly overvalued"

On Wednesday, Jamie Dimon, the chief executive officer of JPMorgan Chase, widely known as the "king of Wall Street," warned at the Davos World Economic Forum in Switzerland that there are signs of overheating in the U.S. stock market. He mentioned risks brought on by deficit spending, inflation, and geopolitical turmoil, and expressed more caution compared to others in the business world. "By virtually any measure, asset prices are a bit stretched," Dimon said, noting that these asset prices are at historical valuation levels in the top 10% or 15%. Dimon stated that the U.S. stock market is currently in a long-running bull market, and pointed out that certain bond markets, such as sovereign debt, are also "at historical highs". "So prices are going up, and you need pretty good performance to justify these prices. Setting growth-promoting strategies can help achieve this goal, but there are also negative factors that can often exceed your imagination." At 68 years old, Dimon is a figure of immense influence in the financial world. Since 2022, he has been issuing warnings, having stated earlier that a "hurricane" is coming towards the U.S. economy. However, this storm has yet to arrive, as the U.S. economy has been outperforming market expectations in recent years. "On many issues, I am indeed more cautious. I am a little cautious about deficit spending; it is a global issue, not just a U.S. issue. There are also related issues, 'will inflation disappear?' I'm not very sure," Dimon said. Dimon added that global conflicts such as the Russia-Ukraine conflict and tensions in the Middle East are escalating, making him very concerned about the impact they will have on our world in the next 100 years. Dimon's remarks come on the third day of Donald Trump's second term as president. Currently, Wall Street is generally welcoming Trump's return, as financial executives believe Trump is more pro-business and growth-oriented than Biden. Dimon had expressed optimism among bankers after the U.S. election in November, and since Trump's election, the S&P 500 index has risen by 4.6%. Earlier this month, Dimon also mentioned that he was not surprised by Trump winning the U.S. presidential election. In an interview at the World Economic Forum last year, he stated that on certain issues, Trump "is right to a certain extent".