David Solomon, CEO of Goldman Sachs global investment bank, believes there is a high chance for a U.S. depression. He stressed that the “environment heading into 2023 is one that you’ve got to be cautious and prepared for.”
Goldman Sachs CEO Warns about the U.S. Goldman Sachs CEO Warns About U.S.
David Solomon, Goldman Sachs CEO, warned of the future direction of America’s economy in an interview that he did with CNBC on Tuesday. He stated:
I think it’s a time to be cautious, and I think that if you’re running a risk-based business, it’s a time to think more cautiously about your risk box, your risk appetite.
“I think you have to expect that there’s more volatility on the horizon now,” the Goldman CEO continued. “That doesn’t mean for sure that we have a really difficult economic scenario. But on the distribution of outcomes, there’s a good chance that we have a recession in the United States.”
However, the executive noted: “The fundamentals really don’t change. The leadership does move to different places, but it’s the same leadership.”
Solomon spoke out to say that investors must be aware of the risks ahead.
That environment heading into 2023 is one that you’ve got to be cautious and prepared for.
“In an environment where inflation is more embedded and growth is slower, you know, asset appreciation will be tougher,” he cautioned. “Are we going to get rooted in that kind of a decade-long scenario? I don’t know.”
Goldman CEO John Goldman explained how the U.S. will determine its future direction by establishing policies in areas such energy and immigration. He said:
If you’re a risk manager right now, I think you have to prepare for a more difficult environment in 2023.
Goldman Sachs has released third-quarter results. Profit fell 43%, to $3.07 Billion, or $8.25 per share. However, this was higher than the $7.69 estimated by analysts polled by Refinitiv. Additionally, revenue fell by 12% at $11.98 billion.
Solomon announced also on Tuesday that a company reorganization was taking place. According to the CEO:
Today marks the beginning of the next phase in our growth. We will be realigning our businesses, which will allow us to capitalize even more on One Goldman Sachs’ dominant operating model.
“We are confident that our strategic evolution will drive higher, more durable returns and unlock long-term value for shareholders,” he affirmed.
Solomon’s counterpart at JPMorgan Chase, Jamie Dimon, recently warned that a recession could hit the U.S. economy in six to nine months. A recent survey found that 98% of chief executives are prepared for an American recession. President Joe Biden, however, is not worried, stating over the weekend that the economy is “strong as hell.”
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