Jamie Dimon, CEO of JPMorgan Chase, said one of Trump’s proposals would create an “economic disaster.” – Eduardo Munoz\/Reuters <\/p>\n
Top Wall Street bankers during the Trump 2.0 era have tread carefully around the subject of politics generally and President Donald Trump specifically. The consensus has generally been: Smile and nod, stay in your lane, don\u2019t become a target.<\/p>\n
But when a Trump \u201caffordability\u201d proposal earlier this month targeted banks\u2019 profit engine, the mood shifted. Publicly and forcefully, Wall Street executives were telling Trump \u201cno.\u201d<\/p>\n
It\u2019s not going over well.<\/p>\n
On Thursday, the notoriously litigious president sued JPMorgan Chase and its CEO, Jamie Dimon, alleging the bank improperly \u201cdebanked\u201d Trump after the Jan. 6, 2021, assault on the US Capitol. Trump is seeking $5 billion in damages.<\/p>\n
Trump has previously threatened the suit, which was likely in the works for months. But, perhaps not coincidentally, its filing in Florida state court came one day after Dimon told a room full of powerful people at the World Economic Forum in Davos, Switzerland, that Trump\u2019s proposal to slash credit card interest rates roughly in half would be \u201can economic disaster.\u201d<\/p>\n
The White House referred questions about the case to Trump\u2019s outside counsel, Alejandro Brito. His law firm didn\u2019t immediately respond to a request for comment.<\/p>\n
Dimon\u2019s public critique breached what has become an unofficial, often uneasy, agreement among the leaders of Corporate America: Stay out of the Trump\u2019s way, even when his policies directly affect the bottom line.<\/p>\n
When Trump last spring rolled out steep global tariffs that threatened to sap corporate profits, executives stayed quiet. Ditto when Trump began going after the Federal Reserve, a body whose independence is vital for a stable business environment. Even when he started explicitly meddling in private companies, carving out a cut of revenue for the government from companies like Nvidia and Intel, no one spoke out.<\/a><\/p>\n Corporate America comes by its trepidation honestly. Since Trump\u2019s second term began a year ago, he and his administration have investigated, sued or brought charges against an array of perceived enemies, including media companies like CBS, the New York Times, the Wall Street Journal. He threatened Apple with massive tariffs last year over a perceived slight from CEO Tim Cook, and Trump said he would block Exxon from entering Venezuela because Trump didn\u2019t like CEO Darren Woods\u2019 lack of enthusiasm during a meeting of oil executives earlier this month.<\/p>\n Privately, some trade groups were drafting plans to push back<\/a> against the Trump administration in defense of their business interests, people familiar with the matter told CNN at the time. But those plans were shelved, as members worried about inviting the ire of the White House.<\/p>\n Story Continues <\/p>\n And CEOs across the board are \u201cvery alarmed\u201d by the administration\u2019s attack on the Fed\u2019s independence, according to Jeffrey Sonnenfeld, founder of the Yale Chief Executive Leadership Institute. Sonnenfeld and his research team found that 80% of the CEOs they surveyed <\/a>believed Trump was not acting in America\u2019s best interest by pressuring Federal Reserve Chair Jerome Powell to cut interest rates. (Notably, that survey was conducted before the Department of Justice launched its criminal investigation into the bank and Powell.)<\/p>\n But for Wall Street, the president seemed to finally cross a red line with the proposed 10% cap on credit card rates. In a Truth Social post on Jan. 9, the president, who is struggling to convince voters that Republicans care about the cost-of-living crisis, said the public will no longer be \u201cripped off\u201d by credit card companies, which charge an average interest rate of 20% on card purchase.<\/p>\n Even though such a cap would probably need to come from Congress, the statement rattled Wall Street, prompting rare critical public statements from executives.<\/p>\n \u201cA rate cap is not something that we can support,\u201d said Jane Fraser, CEO of Citigroup, on the bank\u2019s earnings call.<\/p>\n Bank of America CEO Brian Moynihan \u2014 no stranger to being publicly dressed down<\/a> by Trump \u2014 said last week that a cap wouldn\u2019t have the effect Trump is seeking: \u201cIf you bring the caps down, you\u2019re going to constrict credit, meaning less people will get credit cards and the balance available to them on those credit cards will also be restricted.\u201d<\/p>\n But Dimon\u2019s \u201ceconomic disaster\u201d statement at Davos was a more direct critique, coming from the most prominent figure on Wall Street, and someone who has had a rocky personal relationship with Trump.<\/p>\n Trump and Dimon have had an uneasy relationship for years.<\/p>\n In 2018, in a comment Dimon almost immediately walked back, the Wall Street titan told a panel at the bank\u2019s headquarters that he \u201ccould beat Trump\u201d in a head-to-head presidential race \u201cbecause I\u2019m as tough as he is, I\u2019m smarter than he is.<\/p>\n Trump responded online, calling Dimon \u201ca poor public speaker & a nervous mess.\u201d<\/p>\n Dimon\u2019s approach to the president during his second term has been far more measured. In his Davos interview, Dimon said he disagreed with some of Trump\u2019s policies, agreed with others, but largely avoided a question about why he and other CEOs have been so unwilling to stand up to the president.<\/p>\n He may have seen the writing on the wall. After a tepid statement on JPMorgan\u2019s earnings call disagreeing with Trump\u2019s credit card rates plan (\u201cit would be dramatic on subprime\u201d) and his criminal investigation of Powell (\u201cnot a good idea\u201d), Trump called out Dimon publicly.<\/p>\n \u201cJamie Dimon probably wants higher rates,\u201d Trump said on January 15. \u201cMaybe he makes more money that way.\u201d<\/p>\n Two days later, after the Wall Street Journal reported<\/a> that Trump had previously offered Dimon the Fed chair role, Trump announced he would sue.<\/p>\n \u201cThere was never such an offer and, in fact, I\u2019ll be suing JPMorgan Chase over the next two weeks for incorrectly and inappropriately DEBANKING me after the January 6th Protest,\u201d Trump said on Truth Social<\/a>.<\/p>\n CNN\u2019s Matt Egan, Chris Isidore and Phil Mattingly contributed reporting. <\/p>\n A day after Dimon’s comments in Davos, Trump filed a lawsuit in Florida over JPMorgan’s decision to drop him as a client following the Jan. 6, 2021, attack on the US Capitol. – Fabrice Coffini\/AFP\/Getty Images <\/p>\n