Bank of America and JPMorgan Say US Economy Is Doing Well, Consumers Are in Good Shape Despite Inflation

Bank of America CEO Brian Moynihan and JPMorgan & Chase CEO Jamie Dimon both agree that the U.S. economy is doing well and consumers are in good shape. “The consumers basically have more money in their accounts by multiples than they did pre-pandemic,” said the Bank of America chief.

Bank of America CEO Brian Moynihan said at the Institute of International Finance (IIF) annual membership meeting in Washington, D.C., last week that the U.S. economy is in good shape despite inflation, jittery markets, and international tensions, Bloomberg reported.

Emphasizing that the Federal Reserve has to raise rates to slow down inflation and act against the spending forces of U.S. consumers, Moynihan was quoted as saying:

The toughest challenge for the Fed is actually one of the best things about the U.S. economy — is that it’s in pretty good shape.

“The consumers basically have more money in their accounts by multiples than they did pre-pandemic,” the Bank of America chief added. “They’re earning more money. Their credit quality is as high as it’s ever been. They have more excess capacity.”

During a conference call to discuss Bank of America’s third-quarter results Monday, Moynihan said: “Analysts might wonder whether the talk of inflation, recession, and other factors could [result] in slower spending growth. We just don’t see [that] here at Bank of America.”

He revealed that the bank’s customers continue to spend freely. Their transaction volumes increased 10% in September and the first half of October from the previous year while the number of transactions rose 6%. Moreover, the Bank of America executive said customers’ account balances are higher than before the Covid pandemic struck in early 2020, suggesting that they were in a good position to continue spending.

The CEO of JPMorgan Chase & Co., Jamie Dimon, also believes that American consumers are in good shape and the U.S. economy is doing well.

In an interview with CNBC at the JPM Techstars conference in London last week, the JPMorgan executive said:

Currently, right now, the U.S. economy is actually still doing well. Consumers have money, they’re spending 10% more than last year, their balance sheets are in great shape.

Dimon added: “Yes, debts have gone up a little bit, but not near pre-Covid levels. Therefore, even if we go into a recession, they’re going to be in much better shape than in 2008 and 2009. Companies are in good shape, credit is very good.”

Nonetheless, the JPMorgan CEO has warned about an economic hurricane or something worse than a recession. He believes that a recession could hit the U.S. economy in six months and the stock market could easily drop another 20%.

Do you agree with Bank of America CEO Brian Moynihan and JPMorgan CEO Jamie Dimon about consumers and the U.S. economy? Let us know in the comments section below.