(Bloomberg) — There’s Jamie Dimon, then there’s Jeremy Grantham.

The CEO of JPMorgan Chase & Co. has said there are reasons that the market can keep up its levels. A strong recovery in the second half because of pent-up demand “can justify a lot of prices out there,” Dimon told reporters last week in a briefing. That’s regardless of rising rates, he said. However, all bets are off if the vaccine rollout stumbles, or other issues surface.

Grantham, the co-founder of GMO and a long-time student of market cycles, sees a collapse as inevitable. He thinks a plunge could rival the dot-com bust in 2000, or the crash of 1929 — when stocks plunged almost 80% or more. The value investor believes that U.S. President Joe Biden’s recovery plan could bring stocks to even more fragile heights, he told my colleague Erik Schatzker.

One of these men may be correct in the end. Either way, it’s a steady reminder that recoveries are not only long — but uneven. We’ve seen the S&P 500 make a steady climb higher since it hit rock bottom in March, only to reach new heights by Biden’s inauguration. But nearly another 1 million people have filed for unemployment in the most recent Labor Department report. “Today, we are not where we need to be,” Brian Deese, the director of the National Economic Council, said in a briefing Friday. Will the market catch up with reality?

And does the central bank have the tools it needs should the markets crash once more? As a reminder, in the doldrums of March, the Fed’s early moves to pump the market with trillions of dollars didn’t save stocks from tumbling for days more. It was only when it said it would buy corporate bonds as well, that investors were saved.

But as we wait for the next shoe to drop, money has been made.

Bank Records

In a pandemic year, Morgan Stanley brought in the most revenue in history, while JPMorgan posted the best three months of profit the bank has ever seen. Goldman Sachs said its investment bank had record net revenue.

And the stars of Wall Street have aligned: Morgan Stanley remained No. 1 in equities trading, Goldman Sachs was the leader in deal fees and JPMorgan’s fixed-income trading powerhouse brought in more money than the rest.

Yet investors aren’t biting. Each bank had stock-price declines for the week.

When it comes to Main Street, the story is more complicated. On one hand, Bank of America’s Brian Moynihan painted a picture of an improving consumer outlook. On the other, his executives faced questions on whether they’d stop taking deposits or start charging for them. As clients flush their banks with cash, Moynihan’s firm and its rivals are facing lending ratios that are quite low. At JPMorgan, the key measure of lending fell during every quarter in 2020.

If conditions keep getting worse, it draws the question: How willing will banks be to extend credit in a battered economy? Despite some relative optimism from CEOs, as JPMorgan’s Jennifer Piepszak said in the bank’s earnings call: “The bridge has been strong enough — the question that remains is, is the bridge long enough?”

Facing Crisis

“A lot of America is hurting,” Biden said Friday in a briefing. “Families are going hungry, people are at risk of being evicted, job losses are mounting again. We need to act.”

He highlighted a growing housing crisis as 14 million Americans have fallen behind on rent. Deese also pointed to another insecurity, as food banks across the country face surging demand. Biden is looking at a fight with Congress on his $1.9 trillion stimulus plan, with many parts of his efforts — including raising the minimum wage to $15 — controversial.

Deese is planning to discuss the stimulus plan with a bipartisan group of senators this weekend. We will be following the recovery closely. In the meantime, hoping you have a restful weekend after a very busy week. Tips and opinions welcome at sbasak7@bloomberg.net.

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