Jamie Dimon is starting to sound a bit like Alan Greenspan—and that should make investors nervous.
The JPMorgan Chase CEO warned in a Bloomberg TV interview this week that markets may be showing “too much exuberance,” pointing to frothy valuations around artificial intelligence and the Big Tech giants building out the infrastructure behind it. His choice of words evokes Greenspan’s infamous “irrational exuberance” line from 1996, when the then–Federal Reserve chair cautioned that animal spirits can push asset prices far beyond what fundamentals justify, leaving them vulnerable to painful reversals.
At the time, Greenspan was notably not predicting a bubble and kept monetary policy loose even as a massive one formed around the dawning internet age, bursting painfully at the turn of the millennium. In financial terms, “irrational exuberance” has since come to mean investor optimism that pushes asset prices far beyond what underlying earnings, cash flows, or economic fundamentals justify, fueled by herd behavior and narratives more than data. Nobel laureate Robert Shiller’s book of the same name, first published in 2000, reinforced the idea, over 100 years old by that point but still often forgotten, that bubbles are less about spreadsheets and more about contagious stories that drown out skepticism.
