‘The skunk at the party’: Jamie Dimon warns about inflation and oil prices spiking at the same time, which historically led to recessions

Those straws could come from several sources, including ongoing trade negotiations, a looming credit cycle, job losses and other economic uncertainties that are currently at play. But these factors may not have as much impact as the ongoing war in Iran.

Dimon said the war in Iran could reshape global supply chains and potentially create “significant ongoing oil and commodity price shocks” in the U.S., which could lead to stickier inflation and ultimately higher interest rates than markets expect.

‘The skunk at the party’

As Dimon noted in his shareholder letter, inflation paired with a quick escalation in oil prices was among the main factors that led to recessions in 1974 and 1982.

"The skunk at the party, and it could happen in 2026, would be inflation slowly going up, as opposed to slowly going down," Dimon said.

Among the other risks Dimon highlighted is the potential for job losses driven by artificial intelligence. AI will “definitely eliminate some jobs, while it enhances others,” he said, adding that adoption could move faster than the workforce can adapt, which could dramatically affect unemployment in America.

With this in mind, Dimon is advocating for government and businesses to incentivize retraining, income assistance, reskilling, early retirement and relocation for workers who may lose their jobs to AI (1).

Meanwhile, Dimon said President Donald Trump’s ongoing trade negotiations have the potential to “exacerbate the tense geopolitical issues.”

Before writing his letter to shareholders (2), Dimon told Fox News that while ending the war in Iran is essential, so too is ensuring that the U.S. does not exit the war until it's "successfully completed.”