Yesterday, Goldman Sachs reported its second-best quarter ever.
Today, we heard from JP Morgan, Citi and Wells Fargo. All posted big numbers for Q1 — with almost $34 billion in net income across these four U.S. banks.
And Jamie Dimon (CEO of JP Morgan) attributed these U.S. economic tailwinds to the performance in the quarter: "increased fiscal stimulus, the benefits of deregulation, AI-driven capital investment and the Fed's asset purchases."
That's a formula for economic boom, articulated by the most powerful banker in the world.
Later in the morning, Scott Bessent (Treasury Secretary) spoke at the IMF/World Bank spring meetings and talked about the U.S. growth-focused agenda.
On Europe, he named the lack of sustainable growth as "the biggest risk to financial stability."
And, related, he highlighted Europe's energy problem. He said "the Europeans got into this terrible recursive loop" becoming dependent on Russian crude oil, to such an extent that they were financing the war against themselves through Russian oil purchases.
On China, Bessent said it's the global trade imbalances that represent the second biggest risk: "The world cannot take a China with a trillion dollar trade surplus."
This is what we've been building toward in these notes for the past year.
The trade war was about drawing the world back into alignment with the U.S. and then isolating China. The Iran campaign restructured the energy architecture. And the Treasury Secretary is now saying, on the record, at the most important multilateral economic gathering of the year, that Europe's model has failed and China's surplus is unsustainable.
