Higher interest rates are making bank loans more profitable, and consumers and the economy remain surprisingly strong even in the face of the Federal Reserve’s rate increases.
But more loans are going bad after what had been record-low losses. American consumers are starting to deplete coffers of extra cash they built up during the pandemic. Fighting in the Middle East, the continuing war in Ukraine and rising government deficits are adding to the uncertainty.
“This may be the most dangerous time the world has seen in decades,” JPMorgan Chief Executive Officer Jamie Dimon said.