Historically, the United States has relied on the market’s appetite for U.S. Treasury bonds, at low-interest rates, to support its economy.
Jamie Dimon in Paris, May 15, 2025. (POOL / MICHEL EULER)
The CEO of American bank JPMorgan Chase, Jamie Dimon , expressed concerns on Sunday, June 1, about a potential debt market crisis in the United States “in six months or in six years.” He cited the policies of former President Donald Trump , rising inflation , increasing deficits , and breaches of the rule of law as contributing factors.
“This is a big problem. It’s a real issue. […] I don’t know if it’s in six months or in six years, but the bond market is going to face difficulties,” he stated during an interview on Fox Business . The full interview will air on Monday in the program Mornings With Maria .
According to Dimon, once investors recognize the impact of rising debt levels, interest rates will soar , disrupting the markets—a dangerous scenario for the economy of the world’s leading power. Investors will scrutinize the nation, its rule of law, inflation rates, and the policies of the central bank. “If they decide that the dollar is no longer a safe haven, financing U.S. debt will become more expensive,” he warned.
Historically, the United States has depended on the market’s appetite for Treasury bonds at low-interest rates to bolster its economy.
Extended Tax Credits
Rates spiked last week (before declining) amid fears related to President Trump’s budget proposal , which includes an extension of the enormous tax credits from his first term.
Investors, along with many ultra-conservative lawmakers, are concerned about a widening federal deficit . In mid-May, for the first time, the credit rating agency Moody’s downgraded U.S. debt from its maximum AAA rating to AA1.
The announcements and flip-flops from the White House regarding tariffs also create significant uncertainty and volatility in the markets.
Dimon had previously warned in April about the considerable turbulence facing the American economy, highlighting tariffs, trade wars, inflation, and budget deficits as critical issues.
“I’ve known Jamie for a long time, and throughout his career, he has made predictions like these. Fortunately, not all of them have come true ,” reacted U.S. Treasury Secretary Scott Bessent during an interview on CBS . He acknowledged the level of debt concerns , but assured that “this year’s deficit will be lower than last year’s, and in two years, it will reduce further.”
The process “takes time,” he added. “The goal is to reduce the deficit over the next four years and leave the country in good health by 2028.”