Chairman & CEO, Goldman Sachs Group Inc
Goldman Sachs CEO BREAKS SILENCE about ex-employee’s alleged Epstein ties
Goldman Sachs CEO David Solomon argues the U.S. economy is 'solid' while assessing the economic impacts of Iran conflict and ...
About David Solomon
David Solomon, chairman and CEO of Goldman Sachs, has been a prominent voice on the U.S. economy and artificial intelligence. In media appearances, he described the U.S. economy as "solid" and in "pretty good shape," while acknowledging a complex environment due to geopolitics and the technology super cycle. Solomon stated that the U.S. is in a period where "there's more greed than there is fear," which he said is one reason companies are accessing capital markets. He also addressed the departure of a former general counsel, stating that her association with Jeffrey Epstein occurred before she joined the firm in 2020 and that he had not seen her testimony on the matter. On the topic of AI, Solomon argued that fears of an "AI jobs apocalypse" are overblown, stating he does not believe there will be "massive structural unemployment" but that AI will "interrupt jobs and dislocate" workers, requiring upskilling and adjustment. He expressed optimism about the technology's potential to drive a productivity boom and economic growth, while also noting that the demand for compute infrastructure will not follow a straight line and that government and business have a responsibility to address dislocation. In a graduation speech, he told students that "today is the best day in the history of the world to be in your shoes" and encouraged them to be open to change, invest in relationships, and cultivate passions.
Transcript (25 segments)
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Narrator0:08
The economy is solid. Financial markets look like they are in very good condition. The labor markets look to be in pretty good balance. We've got some work to do on the inflation front.
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Donald Trump0:23
Prices are coming way down.
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Commentator0:26
I want inflation to come down but we have a real problem. The problem is named Donald Trump. He keeps bombing over in Iran. It drives up the price of everything that you buy.
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Bret0:43
For a look at the U.S. economy, the Goldman Sachs CEO joins us here in New York. First 30,000 feet. You see a lot. How do you see the U.S. economy?
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David Solomon0:57
The U.S. economy is in pretty good shape. We certainly are operating in a complex environment. There is a lot of change going on. We have this technology super cycle. That's driving things. Geopolitics are complicated because of the situation in the Middle East. Of course, China. When you get out of that and step back, I'm a huge optimist on the U.S., with a three, five, seven-year view. I think there are enormously compelling characteristics of our economy, capital formation. Entrepreneurship. All the tech innovation going on and we're at the center of accelerating all of that right now and that's definitely an engine for real productivity gains. The economy is solid. Are there headwinds? Some things grinding? Absolutely. The conflict in the Middle East has been a little bit of a headwind but I still feel constructive about where we are at the moment.
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Bret1:55
The inflation numbers for June, the PPI and CPI, were positive. You know, outperformed where people thought it was going to be. Do you think that whips back because of renewed operations in Iran?
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David Solomon2:11
I think the numbers are solid. We've got to wait and see and we need more data. Certainly the energy supply chain and some of the derivative that come out of the supply chains have some sand in the gears because of what's gone on in the last few months but generally speaking with a strong economy, those numbers are encouraging. We'll get the next reading and we'll watch. You've got to watch into the fall. I think it's fragile, and what happens from here will have an impact on how it filters through the economy.
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Bret2:42
Goldman exceeded second quarter profit expectations. Market volatility is obviously a part of that. There is this disconnect between sometimes the big companies, the big firms, and mainstream. That seems to be splitting, and causing maybe some political friction, including the rise of democratic socialism in some corners.
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David Solomon3:04
It wouldn't surprise you. I'm a full throated capitalist. Our system is not perfect. But it's a fantastic system, and the innovation in the economy, capital formation in the economy allows for new businesses, for entrepreneurship to flourish. One thing I'm excited about is I do think these technologies can benefit and allow more participation over time. I know people are very nervous about the changes, et cetera, there is always disruption from technology but what they do is they make us more productive and that's something to be excited about but it will take time to filter into the economy.
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Bret3:40
Do you think that message is out there about A.I.? Do you think that message that A.I. could be the tide that lifts all boats, is being absorbed out there?
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David Solomon3:57
It's not, in my opinion, it's not being absorbed as well as it should. You know, the narrative is shifting a little bit. Certainly there was a community, the tech community had some messages about A.I. and you're seeing those messages start to shift. I wrote the op ed. What people were saying about the labor market didn't make sense to me. Of course, there will be disruption from the technology as technology has disrupted jobs for decades and decades but we also create with technology many new jobs. To give a simple example that Americans can tap into, if you look back at the internet, nobody knew when the internet was created in the 1990s, no one knew that almost 20 years later a company named Uber would be created and create half a million jobs in the United States. The economy is very nimble. It's very dynamic. New businesses emerge. New technologies emerge but I don't think that message is out there. It's one of the reasons why I'm so optimistic about the United States and its prospects. When you look around the world, our innovation, our entrepreneurship, way we are leaders in this new technology, people will have to be patient. There will be change. There might have to be policy intervention, if some of the changes happen too quickly but when you look at five or 10 years I'm very, very excited about the prospects of all of this for the U.S.
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Bret5:20
For politics, low-hanging fruit of populism there seems to be this push against data centers. New York Governor Kathy Hochul is one of them, who has put a moratorium on them. President Trump says it's a horrible idea. What is your message on that?
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David Solomon5:36
You know, I do think the politics around all of this stuff is very tough at the moment. That requires both, you know, business leaders and ultimately political leaders, to help explain, you know, why these things are important. What will be done and how it will be done in the right way. My hope with the moratorium is that it is just a moratorium that allows for progress to be made in New York because I think having data center development in New York will bring more jobs to New York ultimately but it's got to be done in the right way. With the right incentives and benefits for average Americans across the state. By the way, it's going on in Texas and other places, too. There is a political narrative out there that wants to slow this down. It will take time to work through it.
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Bret6:22
Do you worry that some of that messaging is coming from China because they don't want us to succeed.
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David Solomon6:28
I'm not the social media expert in the room but there are lots of issues with misinformation in the marketplace.
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Bret6:34
But you're concerned about Chinese competition overall?
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David Solomon6:38
I'm absolutely concerned. One of the reasons why it's important for us to continue and invest and accelerate in these technologies, is because if we don't others will pass us. It's changed. There is transition. It's important for us to kind of stick to the long term goals and try to explain and bring people along and help them to understand why this will be good for economic growth. Why productivity brings more people along, and why people can participate more broadly in this over time.
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Bret7:08
The Treasury just announced that 6.5 million families have signed up for these Trump accounts. That's more than 1.5 million children eligible for the thousand dollar pilot contribution from Treasury. Your company announcing you're going to contribute, too, for your employees. How do you see this? Is this a way of educating kids? What's your thought about this?
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David Solomon7:31
Brad, who really was the guy behind this, came to me a number of years ago and spoke to me about. This I said to him, I love. This one of the greatest ways to help people understand, you know, how participation in markets works is to have them participate at a young age. His vision was to create a technology or an application that would allow them to watch in real-time at what they owned and how it compounded. I don't think people understand the power of compounding. I think this is an incredible program. An incredible initiative to have so many millions of newborn Americans participating in this and start to save and can see what compounding can be in the stock market over time. I think it's fabulous and Goldman Sachs is proud to be one of the companies on board for our employees.
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Bret8:16
Do you think it's a counter to some of the socialism messaging?
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David Solomon8:20
Again, I'm a capitalist. I believe in a free market system. One of the ways to help people understand the benefits is to try and do things to participate sooner and see those benefits over time. Things are perfect. There are things that are wrong and need to be balanced. But I think it's a great program and Goldman Sachs is very proud to be supporting it.
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Bret8:39
I want to ask you about your former general counsel up Capitol Hill. Kathy lying about her ties to Epstein on the Government Oversight Reform Committee. Criticism for her as this investigation into Jeffrey Epstein is continuing. They questioned her credibility and the nature of her ties to the late convicted sex offender. I wanted to get you to weigh in and comment on that.
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David Solomon9:08
I know Kathy was testifying today about her association with Jeffrey Epstein. Which all occurred before she joined the firm in 2020. Kathy left the general counsel position on June 30, and I didn't see the testimony today and haven't read through it so I don't have further comment on that other than that.
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Bret9:29
She's leaving the firm?
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David Solomon9:30
She's going to leave the firm. We have obviously a big complex firm and we're in transition. We will seat a new legal officer sometime in the near future. She's continuing as an adviser until we get that officer seated because that's in the best interest of the firm, and the shareholders to have that continuity. But as soon as that person is seated s