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Goldman Sachs COO John Waldron sees one-of-a-kind shocks in today’s economy

Economy
03 June 2022 15:43 (AEDT)

John Waldron, co-head of the Investment Banking Division, Goldman Sachs, speaks at the Milken Institute 21st Global Conference in Beverly Hills, California. Source: Reuters

Goldman Sachs President and COO John Waldron said the current economic turmoil is one of the most challenging ones he has ever faced in his career.

He told a banking conference that the current climate is the “most complex, dynamic environment” he has ever seen.

“We’ve obviously been through lots of cycles, but the confluence of the number of shocks to the system, to me is unprecedented,” he said.

His comments came after JPMorgan & Chase Chairman and CEO Jamie Dimon described the challenges facing the US economy akin to a hurricane.

Mr Waldron stressed there is a series of concomitant unprecedented factors hurting the economy, ranging from a commodity shock to an unprecedented amount of monetary and fiscal stimulus.

Despite the challenges, the COO said Goldman Sachs is confident of achieving all its performance indicators as it continues to look for acquisition opportunities in the wealth and asset management space in its effort to diversify its revenue stream.

However, Mr Waldron said the priority would still be recent acquisitions and added that the bank is more cautious about capital expenditure given the current macro environment.

The Wall Street bank is seeking to diversify its business to make it less vulnerable to capital markets cycles.

As part of this strategy, the bank is expanding its asset and wealth management arms.

Waldron sounded a note of caution for the capital market activity, which he expects to be down a lot, saying the volumes are down 70 per cent year-over-year.

On that note, he also said that the merger and acquisitions activity has been more resilient.

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