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Jamie Dimon says Americans only have one problem area when it comes to debt

Apr 14, 2016, 02:30 IST

Scott Gries/Invision/AP

JP Morgan CEO Jamie Dimon says the American consumer is looking great these days, except for in one key area - student debt.

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Dimon spoke at the Grant's Interest Rate Observer Conference in New York City on Wednesday, and (student debt aside) he sounded really upbeat. From mortgages to credit cards, household to even auto loans, Americans are paying off their debts at a steady clip.

That stark difference is what makes growing student debt delinquency stand out so dramatically as an outlier.

"Student debt is going to be a problem," he said. "It's grown too much too fast."

Part of that, he reasoned to the crowd, is actually because banks got out of the student debt game back in 2010. That's when Congress passed an overhaul of the federal student loan program that President Obama called "one of the most significant investments in higher education since the G.I. Bill."

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Over 40% of the 22 million Americans with outstanding student loans aren't paying back on time, according to recent data from the Department of Education. One in six borrowers are in default.

"A lot of that stuff is going to go bad," Dimon said. "There's something wrong there... It would be different if it were in the banks."

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