Jamie Dimon has a warning for Americans accustomed to the dollar sitting atop the global financial system: U.S. military supremacy may be one of the things keeping it there.
The JPMorgan Chase CEO said the U.S. risks losing the dollar’s status as the world’s reserve currency if the country can no longer boast the world’s strongest military and economy in the future.
“If we’re not the strongest military in 25 years and the strongest economy, we won’t be the reserve currency either,” Dimon told PBS over the weekend. “The world will be fragmented, and it’ll be very dangerous for us.”
While it might initially seem like the armed forces have nothing to do with the greenback, American military and economic might are “tied up inextricably together with the dollar,” according to Daniel McDowell, Syracuse’s Moynihan Institute of Global Affairs Associate Director.
“He’s more or less saying that a weak military is a sign of a weak economy, and you would expect that the currency would kind of follow suit,” McDowell told Fortune. “If you think of the economy as being the underlying foundation of dollar dominance, the military is the icing on the cake.”
