US to enter a post-Covid boom ‘torn by income inequality,’ says JP Morgan boss

The US has been “torn and crippled by politics, as well as racial and income inequality” but is about to enter a post-pandemic boom, according to JP Morgan boss Jamie Dimon.

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Photograph: Jeenah Moon/Reuters

In his annual letter to shareholders Dimon, the US’s preeminent banker, said the economy was on the edge of a “Goldilocks moment” when expanding vaccinations, high savings rates and the Biden administration’s massive stimulus bill could trigger a strong recovery that could last well into 2023.


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Dimon’s closely watched letter stands in marked contrast to last year’s when the JP Morgan chief executive when he predicted the US was heading for a “bad recession” in which US gross domestic product could fall by up to 35%.

But his upbeat assessment of the economic landscape also comes with caveats. Dimon has long warned that growing economic inequality poses a systemic threat and that future growth has been challenged by “China, Covid-19 and our own competence”.

Dimon also used the letter to call for greater corporate involvement in the political sphere, a move that comes as US business has been pressed to speak up on issues including racial inequality and voting rights.

2020 was “extraordinary year by any measure”, wrote Dimon. “It was a year of a global pandemic, a global recession, unprecedented government actions, turbulent elections, and deeply felt social and racial injustice. It was a year in which each of us faced difficult personal challenges, and a staggering number of us lost loved ones. It was also a year when those among us with less were disproportionately hurt by joblessness and poverty. And it was a time when companies discovered what they really were and, sometimes, what they might become.”

© Photograph: Jeenah Moon/Reuters
JPMorgan CEO Jamie Dimon wrote 2020 was ‘extraordinary year by any measure’.

America has faced tough times before, Dimon noted citing the civil war, first world war, the US stock market crash of 1929 and the Great Depression that followed, among others. “But in each case, America’s might and resiliency strengthened our position in the world, particularly in relation to our major international competitors. This time may be different.”

China’s leaders believe that America is in decline, wrote Dimon and “see an America that is losing ground in technology, infrastructure and education – a nation torn and crippled by politics, as well as racial and income inequality – and a country unable to coordinate government policies (fiscal, monetary, industrial, regulatory) in any coherent way to accomplish national goals. Unfortunately, recently, there is a lot of truth to this.”

The US needs a “Marshall Plan” he wrote, referring to the initiative to help rebuild Western Europe rebuild after the second world war. Such a plan would mean more spending on infrastructure, education, affordable child care, and job training and “may very well mean higher taxes for the wealthy”.

“Should that happen, the wealthy should keep in mind that if tax monies improve our society and our economy, those same individuals will be, in effect, among the main beneficiaries,” wrote Dimon.

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