With 10 million fewer Americans working than a year ago, San Francisco Federal Reserve President Mary Daly warned March 25, “the labor market is in a ditch.”

So is consumption, as the US government reported March 26: Personal consumption fell by 1% in February. That’s not a surprise, because we already knew that retail sales fell by 3.1% in February. And the earliest notice of March retail sales, Johnson Redbook’s measure of same store sales, is down by 18% from the middle of February to the middle of March.

Analysts blamed the weather for some very disappointing February data; if that were true, we should have seen a March bounce. No such thing happened.

The consumption deficit from the Covid-19 recession is substantial (12-month average line in the chart). After inflation Americans consumed 5%-6% less in the past year than in the previous year, the worst such decline since the 1930s.

The logic behind Biden’s $1.9 trillion stimulus is that if you pay them, they will spend. Call it Field of Dreams economics.

No one is particularly good at forecasting consumer behavior. It’s entirely possible that Americans won’t spend the stimulus checks now hitting bank accounts, but save the money for the next pandemic or recession or whatever other calamity next appears around the bend.

The Biden boom may fizzle, and with it the earnings projections of equity analysts.