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Here’s what the biggest U.S. banks are telling us about the state of the economy. 

Consumer spending is returning to pre-pandemic levels, and borrowing appears poised to rise. Markets are cooling, but deal making is as hot as ever. Still, the recovery remains vulnerable, bank executives said. Covid-19 variants are driving up case counts, raising the specter of new lockdowns. Government-aid programs that kept many Americans afloat are about to expire. 

People Are Spending but Not Borrowing–Yet

Americans are spending again, even more than they were pre-pandemic—booking trips and paying for restaurant meals with their credit cards. Flush with cash from government stimulus programs, they are paying down their card debt faster than they are spending.

That could change as supply-chain bottlenecks ease for cars, refrigerators and other big-ticket items. “The pump is primed” for more borrowing, said JPMorgan Chase & Co. CEO Jamie Dimon.

The Housing Market Is on Fire

The housing market remained red hot, with buyers bidding up the prices of second homes and suburban mansions. Wells Fargo & Co . and JPMorgan extended more mortgages than in the first quarter, which was already a blockbuster stretch for home lending.