Jamie Dimon sees COVID-19 relief, vaccine fueling American rebound this summer
'There's a lot of pent-up demand,' says CEO of largest US lender
Vaccinations against COVID-19 combined with financial relief from Congress have the potential to revive the U.S. economy by this summer, JPMorgan Chase CEO Jamie Dimon says.
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"I think you'll have a better second half because you've got the vaccine coming and you've got fiscal stimulus," Dimon told reporters on Friday after JPMorgan posted stronger-than-expected financial results for the end of last year. "Bottom line, there's a lot of pent-up demand and, hopefully, optimism that we'll get through this mess."
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His hypothesis, if borne out, would mean welcome relief by the latter half of 2021 from a grim downturn accompanying a pandemic that has killed more than 388,000 Americans -- a higher death toll than in any other country, shuttered hundreds of thousands of small businesses and sent unemployment skyrocketing.
An initial stimulus package that sent $1,200 checks to many taxpayers and a follow-up measure late last year have helped Americans who definitely needed help, "people who are unemployed, small businesses, some of the lower-income folks to bridge it to, hopefully, what will be a much stronger economy," Dimon added.
The largest U.S. lender, JPMorgan Chase has a uniquely broad perspective on the country's economic health and sentiment.
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Congressional action on the second coronavirus-relief package and progress on vaccines enabled the New York-based company to free $2.9 billion in loan reserves in the last three months of 2020, though it still retains a sizeable $30 billion bulwark against what executives called "significant near-term economic uncertainty."
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How further relief measures under the administration of Democratic President-elect Joe Biden will affect the company and other U.S. banks remains to be seen.
The former vice president and Delaware senator, set to be inaugurated in less than a week, detailed a $1.9 trillion spending proposal on Thursday evening, one he said is vital to helping Americans weather the coronavirus crisis.
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"Some 400,000 small businesses have permanently closed their doors," Biden said Thursday in Wilmington, Delaware. "A crisis of deep human suffering is in plain sight, and there's no time to waste."
If approved by Congress, his plan would buoy optimism fueled by the preliminary, if halting, distribution of vaccines from drugmakers including a partnership of Pfizer and BioNTech and prescription drugmaker Moderna.
Initial studies from a third vaccine, from Johnson & Johnson, show recipients developing immunity after a single dose, compared with the two required for each of the earlier inoculations.
"It looks like by June or July, you're going to have a lot of people vaccinated. People may need a couple of months after that to get comfortable about going back to work," Dimon said. "You do see people wanting to go back to work if they feel safe, and the vaccine will be a big part of that."