JPMorgan becomes first major bank to say first-quarter GDP will decline because of Covid surge

[brooklynite]

Source: CNBC

JPMorgan economists now see an economic contraction in the first quarter due to the spreading coronavirus and related restrictions being imposed by states and cities.

The new forecast is a departure from Wall Street’s widely held view that the first quarter would be positive, with an improving economy throughout 2021.

The JPMorgan economists said they expect the economy to expand briskly in the second and third quarter, based on positive vaccine developments.

“This winter will be grim, and we believe the economy will contract again in 1Q,” the economists wrote.

Read more: https://www.cnbc.com/2020/11/20/jp-morgan-says-first-quarter-gdp-will-decline-because-of-rising-covid-cases-and-restrictions.html

[IronLionZion]

1. People are still losing jobs and income

This pandemic is impacting lower income workers much worse than the work from home types who can afford to invest in stocks. So there is less consumption. Farmers, restaurant, retail, and some factory workers are impacted.

[Initech]

2. It's going to get worse, then it will get better.