Bank Earnings Show U.S. Economy Is Holding Up

Summary

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WSJ What’s News – PM Edition

Episode Title: Bank Earnings Show U.S. Economy Is Holding Up
Date: April 14, 2026
Main Theme:
This episode dives into the latest earnings reports from major U.S. banks, analysis of an unexpectedly resilient U.S. economy, stock market performance, Amazon’s move in the satellite internet space, and the NBA trend of “tanking” for draft picks.

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1. Robust Bank Earnings Signal Economic Resilience

[00:33–03:04]

• Main Point:
  The largest U.S. banks—JPMorgan Chase, Citigroup, and Wells Fargo—reported strong Q1 results, suggesting U.S. consumers and businesses remain healthy despite global and economic uncertainties.
• Key Numbers:
  • The three banks earned a collective $27.5 billion in Q1, up 17% year-over-year.
• Context:
  • Consumers continue to spend and invest, showing resilience despite concerns over inflation, war in the Middle East, and volatility in private credit markets.
• Expert Insight:
  • Spencer Jacob (WSJ Investing Columnist):
    • “It was generally a good quarter for Wall street banks for sure, but overall, it’s likely to be a very good earnings season, probably the best quarter for growth since 2021.” [02:00]
    • Cautions on listening to executive comments for forward guidance, noting mixed sentiment due to future uncertainties.

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2. Broader Market and Sector Trends

[02:30–03:04]

• Consumer-Facing Companies Under Pressure

  • Spencer Jacob highlights concerns among consumer-driven companies like McDonald’s, Walmart, Darden Restaurants, and cruise lines, which are feeling the effects of energy price shocks and low consumer confidence.
  • “Last week you had the University of Michigan put out the most pessimistic report on consumer sentiment in its entire 74-year history.” [02:37]
  • Despite bleak sentiment, spending hasn’t yet collapsed.

• Other Earnings Highlights:

  • BlackRock: Net income rose 46% to $2.2B, beating analyst expectations.
  • Johnson & Johnson: Revenue up almost 10% (~$24B), driven by strong cancer drug sales.
  • BP: Expects “an exceptional oil trading result” amid Middle East volatility.

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3. Amazon’s Satellite Ambitions

[03:05–04:47]

• Amazon Buys Globalstar for $11B
  • Aims to rival Elon Musk’s Starlink by expanding into satellite-enabled connectivity, particularly smartphone linking.
• Key Details:
  • Globalstar currently powers Apple’s emergency satellite messaging.
  • Patience Hagan (WSJ Telecoms Reporter):
    • “Starlink is way ahead of Amazon in the satellite connectivity business... When Amazon gets control of Globalstar, they'll get a pretty big boost on the way up towards competing.” [04:10]

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4. Major News Updates and Market Rally

[04:47–06:38]

• Media Deal:
  • The owner of the Pittsburgh Post-Gazette will sell the paper to the nonprofit running the Baltimore Banner, saving it from closure.
• Geopolitical Backdrop:
  • U.S. blockade on Iranian ports, UN brokered peace talks between Israel and Lebanon.
• Stock Markets:
  • Nasdaq: Up for 10 consecutive trading days—the longest streak since 2021.
  • S&P 500: Closed near an all-time high.
  • Hannah Aaron Lang (WSJ Markets Reporter):
    • “The Nasdaq is now up for 10 consecutive trading days, which is its longest winning streak since 2021…a pretty stark vibe shift on Wall Street.” [06:00]
  • Investors are focusing on strong corporate earnings and signs of possible U.S.-Iran talks.
• Oil Prices:
  • U.S. crude drops 7.9% ($91/barrel); Brent down 4.6% (under $95/barrel).
  • IMF Warning: Prolonged energy market turmoil could slow global GDP growth to levels only seen in severe downturns.

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5. Fed Chair Confirmation & Financial Disclosures

[06:38–08:05]

• Senate Hearings Scheduled:
  • Kevin Warsh, Trump’s pick for Fed Chair, faces confirmation. Some GOP senators are holding out pending resolution of a DOJ probe into current chair Jerome Powell.
• Financial Snapshot:
  • Warsh’s disclosed net worth: $100M+, notable stakes include Musk’s SpaceX and Polymarket.

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6. NBA “Tanking” for Draft Picks

[08:05–09:29]

• Trend:
  • First NBA season where 8 teams lost at least two-thirds of their games, as struggling teams vie for the top draft pick.
• Purpose:
  • Losing teams get better odds at the #1 draft spot, potentially landing a game-changing superstar.
• Robert O’Connell (WSJ Basketball Reporter):
  • “The worse you do one season...the better your chances...at getting the number one pick...A certain level of superstar...can take a franchise...to championship contention in a couple years.” [08:05]
• League Response:
  • Adam Silver (NBA Commissioner): “Incentives need to be fixed and we will fix them, and I'm looking forward to that.” [08:44]
  • Potential fixes:
    • Equalizing lottery odds among the bottom five teams
    • Basing odds on multi-year performance to discourage short-term tanking
    • Aiming to make losing less beneficial than winning over both short and long terms

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Notable Quotes

• Spencer Jacob:
  “Probably the best quarter for growth since 2021.” [02:00]

• Patience Hagan:
  “Starlink is way ahead of Amazon in the satellite connectivity business...When Amazon gets control of Globalstar, they'll get a pretty big boost...” [04:10]

• Hannah Aaron Lang:
  “The Nasdaq is now up for 10 consecutive trading days, which is its longest winning streak since 2021…a pretty stark vibe shift on Wall Street.” [06:00]

• Adam Silver:
  “Incentives need to be fixed and we will fix them, and I'm looking forward to that.” [08:44]

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Key Takeaways by Segment

• US banks’ robust earnings point to ongoing strength in the broader American economy, even amid global disruptions.
• Consumer confidence is low, but spending and market performance remain solid.
• Amazon’s Globalstar acquisition positions it to compete more directly with Starlink in the satellite internet business.
• Stock markets are rallying, driven by strong earnings and optimism for continued US-Iran diplomacy, despite broader volatility.
• Oil prices retreat, though future instability could threaten global growth.
• NBA “tanking” intensifies, with league considering rule changes to rebalance incentives.

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Structure:

• Focused on core news items and analysis
• Provided direct quotes and timestamps for deeper context
• Skipped ads and non-news content per guidelines

Transcript

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[Alex Osola]

Earnings from America's biggest banks show the U.S. economy is still going strong. Plus, U.S. stocks continue their gains, with the Nasdaq hitting its longest winning streak in years and why Amazon is buying a rival to Elon Musk's satellite network, Starlink.

[Patience Hagan]

Starlink is way ahead of Amazon in the satellite connectivity business. When Amazon gets control of Global Star, they'll get a pretty big boost on the way up towards competing with Star.

[Alex Osola]

Tuesday, April 14 I'm Alex Osola for the Wall Street Journal. This is the PM edition of what's news, the top headlines and business stories that move the world today. The biggest US Banks are reporting earnings this week and they've got good news. American households and businesses are holding up today. JPMorgan Chase, Citigroup and Wells Fargo said customers continued to spend, borrow and invest in the first quarter, even even as war broke out in the Middle east and investors worried about risks from inflation, AI and turmoil in private credit funds. The three banks earned a collective $27.5 billion in the first quarter, up 17% from a year earlier. In his most recent newsletter, WSJ investing columnist Spencer Jacob says there's reason to think that these good results won't just be limited to the banking sector, even though consumers are showing some signs of strain. Spencer where might we be seeing these strong earnings?

[Spencer Jacob]

It was generally a good quarter for Wall street banks for sure, but overall it's likely to be a very good earnings season, probably the best quarter for growth since 2021. Which to put that in perspective, that's when we were still rebounding from the pandemic contraction in the economy. While a blowout quarter, a very good quarter for a company can definitely lift its stock, people are very nervous about what lies ahead and they listen very carefully to what executives say to analysts and investors on the call, and that's a bit of a mixed bag.

[Alex Osola]

Looking forward, are we expecting there to be some differences in different sectors and industries as they're reporting their earnings?

[Spencer Jacob]

We definitely are the really interesting thing is looking at consumer facing companies. Look at McDonald's or look at Walmart or look at Darden restaurants that owns Olive Garden. Talk to a cruise line. Those are companies that are directly affected by the energy shock and and the shock to confidence. Last week you had the University of Michigan put out the most pessimistic report on consumer sentiment in its entire 74 year history. Of course, sentiment doesn't necessarily translate to dollars, but that's not a great sign.

[Alex Osola]

That was WSJ investing columnist Spencer Jacob. In other earnings news, BlackRock, the world's largest asset manager, says net income rose by 46% to $2.2 billion on higher investment fees, beating analyst expectations. Johnson and Johnson reports that revenue grew almost 10% to about $24 billion. The health care company's strong cancer drug sales offset a steep decline from one of its best selling drugs. Stelara JJ lifted its forecast for the year and BP said today that it expects an exceptional oil trading result for the first quarter. With the war in the Middle east fueling market volatility, it will report its full earnings later this month. Amazon has agreed to buy satellite operator Globalstar in a roughly $11 billion deal. Amazon wants to build a business connecting consumer smartphones via satellite Internet, and Patience Hagan, who covers telecoms for the Journal, says this acquisition should help Amazon compete with the dominant satellite Internet network. Elon Musk's Starlink.

[Patience Hagan]

Starlink is way ahead of Amazon in the satellite connectivity business. Starlink already powers broadband Internet today by Satel cell service by a satellite through a partnership with T Mobile. Amazon is buying Globalstar to boost this business. Globalstar is already providing this kind of connectivity for Apple services that let you text emergency services for help when you're in an area with no cell service. When Amazon gets control of Globalstar, they'll get a pretty big boost on the way up towards competing with

[Alex Osola]

the owner of the Pittsburgh Post. Gazette is selling the newspaper to the nonprofit that owns the Baltimore Banner. Ohio based Block Communications had planned to close the Post Gazette next month because of financial losses. Terms of today's deal weren't disclosed. Coming up, what's driving a market rally and the strategy that's got the biggest teams in basketball competing for last place? That's after the break. Foreign. Command said no ships out of Iranian ports have gone through the US blockade within its first 24 hours. Meanwhile, the United Nations Secretary General said that the talks between the US And Iran are likely to resume. And in Washington, Israel and Lebanon have agreed to launch direct negotiations for a comprehensive peace deal after rare face to face talks. Hezbollah's chief has called the discussions pointless and said just talking to Israel is a surrender. Major US Indexes climbed broadly today. The Nasdaq led the gains and closed up 2%. Journal markets reporter Hannah Aaron Lang says investors may be getting immune to changing headlines on tensions with Iran.

[Hannah Aaron Lang]

We are now solidly in the green for 2026. The Nasdaq is now up for 10 consecutive trading days, which is its longest winning streak since 2021. The S&P 500 actually closed really close to an all time high, which is pretty remarkable given the swings in markets that we've seen over the last few weeks. And this is a pretty stark vibe shift on Wall Street. It may just be that investors are focusing on earnings from America's biggest companies and earnings expectations are actually pretty high. The US And Iran have also signaled that they see room to continue talking, so investors may be clinging on to that piece of good news as well.

[Alex Osola]

And oil prices are in retreat. U.S. crude was down 7.9% to about $91 a barrel, and Brent crude, the international benchmark, fell 4.6% to just under $95 a barrel. But the International Monetary Fund is warning that if the disruptions to the energy market last into 2027, world economic growth could slow to about 2%. That's a rate seen only during the deepest recent downturns. The Senate Banking Committee says it will hold confirmation hearings for Kevin Warsh, President Trump's choice to lead the Federal Reserve, in a week. Some Senate Republicans have said that they wouldn't vote for any nominee until the Justice Department ends its probe of the current chair, Jerome Powell. Ahead of the hearing, Warsh has disclosed details of his finances. His financial interests are worth more than $100 million, and they include stakes in Elon Musk's SpaceX and prediction market firm Polymarket. The NBA just wrapped up its regular season this week, but some of basketball's most ambitious franchises weren't going all out to win. Instead, they were the league's worst teams, trying to notch as many losses as they could. In fact, it was the first season in the league's history where eight teams lost at least two thirds of their games. Robert o' Connell covers basketball for the Journal and is here to discuss. Robert, what is the incentive for these teams to lose just in general?

[Robert O'Connell]

Well, the worse you do one season in the NBA, the better your chances the next season at getting the number one pick in the rookie draft. So having the top selection of all the amateur players from college and internationally entering the NBA, a certain level of superstar like LeBron James or Victor Weminyama can take a franchise from the cellar of the league, the bottom of the standings, to championship contention in a couple years. Three college freshmen who will be entering the draft from byu, Kansas and Duke, who are considered very high prospects, they sort of incentivize t a little more than you might see in other years.

[Alex Osola]

NBA commissioner Adam Silver has pledged to fix this incentive to lose.

[Adam Silver]

Incentives need to be fixed and we will fix them, and I'm looking forward to that.

[Alex Osola]

How can he actually do that?

[Robert O'Connell]

There are a few levers the league is looking at pulling on here. Two of the variables they might look at. One is smoothing out those lottery odds, making the five worst teams all have the same odds at winning the lottery. And then another option is not only looking at the previous season's record. So it's not as simple as having one down year and you can boost your chances. Presumably the idea is that a team wouldn't be willing to suffer through two terrible years to pursue the number one pick. The league wants a situation where, simply put, it's less beneficial in the short and long term for a team to lose than to win.

[Alex Osola]

That was WSJ reporter Robert o', Connell, and that's what's news for this Tuesday afternoon. Today's show is produced by Pierre Biennime and Danny Lewis, with supervising producer Tali Arbel. I'm Alex Osola for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.

[Adam Silver]

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