JPMorgan Chase & Co.
(NYSE:JPM) CEO Jamie Dimon warned that high leverage across financial markets could magnify disruptions, urging investors to be aware of hidden borrowing risks.
On Wednesday, in an interview with CNBC’s Leslie Picker, Dimon said, "Margin debt is the highest it has ever been." He said that there is significant leverage in the market that isn't reflected in official margin debt figures because it is "hidden" under other forms of borrowing.
Dimon warned that high leverage across prime brokerages, hedge funds, ETFs, and Treasury arbitrage strategies has increased the risk that a single investor or fund could trigger rapid market volatility.
"When you have that, you do have a higher chance that somebody will disrupt the market in a quick way, and people get rattled over it," said the JPMorgan CEO.
