In his annual letter to shareholders Wednesday, JP Morgan’s CEO said strong consumer savings, expanded vaccine distribution and President Biden’s proposed infrastructure plan could lead to an economic “Goldilocks moment.”
Steven Kyle, an expert in macroeconomics and government policy at Cornell University, says it is appropriate to be optimistic about the country’s economic future.
“There is every reason to be optimistic about the next couple of years. While people at the bottom of the income distribution are still suffering, there is substantial pent-up demand from households emerging from the pandemic and lots of savings. Housing in particular looks very strong as demand is outpacing the ability to build new units.
“Add to this the substantial stimulus coming to everyone, and especially the ongoing child benefit for the next year and there is no reason to imagine that there will be any lack of demand going forward. While corporate CEO’s may complain about Biden’s 28% corporate tax proposal to fund his infrastructure program, that isn’t really that much higher than Mitt Romney’s proposed 25% a while ago. And we certainly need the infrastructure investment – there is a massive backlog of projects that can both provide employment across the country and improve competitiveness in the future.”