JPMorgan, Goldman execs point to benefits of oil rout

GMT 09:38 2016 Thursday ,21 January

Arab Today, arab today JPMorgan, Goldman execs point to benefits of oil rout

Jamie Dimon, Chairman and CEO of JPMorgan Chase
New York - AFP

Two top US bankers said Wednesday that the oil price collapse is likely to help economies long-term, even as markets slump in reaction.

JPMorgan chief executive Jamie Dimon said he is still hoping the stock rout of early 2016 that worsened Wednesday will turn out to be only a "speedy adjustment" that does not signal a major global slowdown.

"You've got to separate fluctuations in the market from the economy," Dimon told CNBC in an interview broadcast from the World Economic Forum in Davos, Switzerland.

Lower oil prices benefit some leading economies, such as India and Japan, as well as US consumers, even as they prompt sovereign wealth funds from petroleum-dependent countries to liquidate investments to raise funds, he said.

Dimon's remarks were echoed by Goldman Sachs chief financial officer Harvey Schwartz, who said that the oil slump may not translate into "a real drag on long-term economic activity."

"It feels like the degree to which the market is focused on the energy exposure has managed to discount the longterm tailwinds to the consumer in a reduction of costs across the globe," he told an analyst conference call.

The comments came as global stock markets registered another bruising session, with leading bourses in Europe and New York off between 2.5 percent and 4.0 percent.

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