Banks on Wall Street report bumper second-quarter profits

were full of good cheer as they reported their second-quarter earnings on July 13th and 14th. “The consumer...their house value is up, their stocks are up, their incomes are up, their savings are up...they’re raring to go,” said Jamie Dimon, the boss of JPMorgan Chase, when analysts asked about the risk that economic growth might slow in the coming months. David Solomon, the chief executive of Goldman Sachs, sounded upbeat when asked if an executive order from the White House seeking to increase competition among businesses might cool feverish dealmaking activity: “I’m encouraged by the fact that our backlog levels remain extremely high...A lot of that feels like it will be sustained.” Jane Fraser, the boss of Citigroup, expressed a similar sentiment, telling analysts “we have a fabulous pipeline.”For an entire year now America’s banks have enjoyed a profits bonanza. Investment banks, which issue equity and debt for companies and make markets in stocks and bonds, have reaped bumper profits as trading activity has boomed. Retail banks took an early hit as they wrote down loan values for expected losses in early 2020. But they have since been able to gradually revise loan values back up, first as stimulus helped customers stay afloat and then as the economy began to reopen.