As the hopes of the Federal Reserve cutting interest rates quickly fade and geopolitical risks increase, Wall Street executives seem to be even more pessimistic about the direction of the economy.
At the Future Investment Initiative meeting held in Saudi Arabia, Goldman Sachs boss David Solomon said, "If you listen to today's conversation, you will find that CEOs have a lot of uncertainty in reaching new deals
Goldman Sachs announced last week that its third quarter profit decreased by 33%, partly due to the cautious attitude of companies leading to a long-term downturn in its investment banking business, which has occurred in many large banks with significant operations on Wall Street.
Many executives who have been touting signs of "recovery" this summer have warned that it may take longer for any sustained growth to occur now. Solomon added, "In the long run, of course I am optimistic, but I am not sure yet. If you are a CEO and you are unsure, then you tend to be cautious about major measures that change the company's trajectory
In fact, from JPMorgan Chase CEO Jamie Dimon and Citigroup CEO Jane Fraser, to BlackRock CEO Larry Fink and Bridgewater founder Dario, Wall Street insiders have issued several new warnings, one of which is Goldman Sachs CEO's remarks.
Recently, the Palestinian-Israeli conflict has added a new dimension to global turmoil. Other worrisome developments highlighted by Wall Street leaders include continued inflation, the Russia-Ukraine conflict, the plight of commercial real estate, and the uncertainty surrounding the upcoming US presidential election.
It's hard not to feel a bit pessimistic, "said Jane Fraser, CEO of Citigroup. She pointed out that Hamas has recently launched attacks in Israel and tensions in the region are escalating.
BlackRock's Fink, who manages the world's largest fund management company, mentioned the economic risks posed by the new world conflict. He said, "War, fear, and instability have consequences, and I believe this will lead to a decrease in hope and an increase in fear. If we do not treat this world as a whole, it will lead to greater contraction
On October 13th, Xiaomo CEO Damon announced the industry's performance, stating that "this may be the most dangerous moment in the world in decades". This week, he also openly warned of potential economic dangers.
Damon said, "Be prepared for various possibilities, rather than just proposing one action plan, because I have never seen anyone propose such a plan. I want to point out that 18 months ago, the central bank was 100% completely wrong
I will be quite cautious about what may happen next year, "he added. He warned that interest rates could exceed 7% and urged people to be prepared to prevent such a situation from happening.
Dario also said he is concerned about the impact of rising interest rates.
If you consider the time span, we will see that monetary policy and other factors will have a greater impact on the world, "he said. It's difficult to be optimistic about this because you look at the world gap