Key Words: ‘It could be a deep correction’ — J.P. Morgan co-president warns of 40% stock pullback

Stock traders buckle up — the market is set for as much as a 40% plunge in the next two to three years, essentially wiping out the last two year’s market rally in the U.S.

That’s the warning from J.P. Morgan JPM, +0.01% Co-President Daniel Pinto, who in an interview with Bloomberg Television on Thursday said “we know there will be a correction at some point.” A correction is usually defined by a more than 10% drop from a recent market peak.

‘It could be a deep correction. It could be between 20% to 40%, depending on the valuation.

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