The US is headed for a period of trade activity that could match or exceed a decade’s worth of capital increases and mergers and acquisitions, according to Goldman Sachs ( GS ) CEO David Solomon. A growth-oriented environment and a relaxed regulatory environment are expected under the incoming Trump administration, which will not boost deals but benefit the advisory banks.
“I have a lot of hope that this government will pursue an agenda focused on growth,” Solomon said while speaking at the Reuter NEXT conference today (December 10) in New York. The banking executive predicts friction in both transaction activity and asset prices, which he described as “good for Goldman Sachs’ business.”
Investors seem to agree. Along with other big banks, Goldman Sachs saw its shares rise in the wake of Trump’s election, jumping 13 percent on Nov. 6. The bank’s stock price is up more than 50 percent this year.
As a sign of the President-elect’s pro-business plans, Trump in November nominated hedge fund manager Scott Besent as Treasury Secretary. “I think Scott has a great understanding of markets and capital flows, and I think that’s an important indicator in policy decisions,” said Solomon, who noted that he “enjoyed working with the new economic team.”
What about crypto and AI?
The incoming administration is also expected to take a more pro-crypto stance toward digital currencies, with Trump tapping venture capitalist David Sacks to serve as “AI and Crypto Czar” to oversee reformed regulations in the crypto industry. The regulatory framework around cryptocurrencies like Bitcoin, which cannot be managed by Goldman Sachs right now, “must change,” according to Solomon. “These are speculative assets at the moment, but people are very interested in them,” he added.
Restrictions around AI development, too, will be an important part of Trump’s agenda. Like many other banks, Goldman Sachs has been experimenting with AI. “If we can grow, with these tools, their code production by 20 percent or 30 percent, it’s a big wind for us,” he said.
One of the biggest concerns surrounding AI is the technology’s potential for job displacement—something Solomon isn’t worried about. Goldman Sachs’ figures have grown steadily over the decades despite the emergence of new technologies, the CEO said. He predicts that the company will continue to grow over the next decade, although disruption is inevitable when it comes to technological advancements. “Our economy — given the resurgence of our economy, the strength of our economy — is very good at taking those shifts,” Solomon said. “I don’t fall into the camp that is somehow very different this time.”
