Goldman Sachs CEO, David Solomon, expressed optimism about the resilience of the U.S. economy and improving trading conditions despite geopolitical tensions. He spoke during the Future Investment Initiative conference in Riyadh, stating that the U.S. economy is performing well with a likely soft landing scenario. This follows Goldman's recent report of a 45% profit increase in the third quarter, driven by surprising growth in stock trading revenue and a rebound in investment banking.
While acknowledging potential shifts due to the upcoming U.S. elections, Solomon emphasized the positive changes in the trading environment. However, he noted concerns over Middle Eastern tensions, particularly the strained relations between Israel and Iran, marking the highest tension levels in decades. Solomon indicated that although the situation is worrisome, it has not significantly impacted regional activities yet.
He also warned of regulatory risks with the U.S. elections approaching, pointing out that upcoming policy decisions could affect economic trajectories for 2025 and 2026. Solomon assured that Goldman Sachs is equipped to support any government and its clientele, regardless of election outcomes. He expressed more concern over economic conditions in Europe but maintained that the U.S. remains robust.
In discussing Goldman's financial health, Solomon highlighted the bank's robust equity franchise, stressing its readiness to serve clients and maintain a leading position despite a decline in fixed income profit margins. The firm has narrowed its focus on consumer activities, emphasizing global banking, asset, and wealth management.
Earlier, Goldman Sachs expanded its presence in the Middle East by opening a new office in Riyadh, enhancing its operations in the region's largest economy. Solomon highlighted no challenges in attracting talent to the Middle East amid competition between Riyadh and Dubai, viewing increased competition as a beneficial factor driving higher levels of activity.
