Good morning. David Solomon, chair and CEO of Goldman Sachs, leads one of many world’s most distinguished funding banks and sees AI as a key development driver, although he cautions the trail forward gained’t be easy.
Talking on the Financial Membership of Washington, D.C., on Thursday in a dialog with Carlyle Group co-founder David Rubenstein, Solomon mentioned the state of the U.S. financial system, the affect of rising public debt, and the AI funding increase in entrance of a packed viewers.
An outlook on development
Goldman Sachs (No. 32 on the Fortune 500) reported stronger-than-expected third-quarter earnings this month, pushed by sturdy funding banking charges and buying and selling income. When Rubenstein requested Solomon whether or not the U.S. faces a near-term recession, Solomon provided cautious optimism.
“We’ve obtained an enormous, numerous financial system,” he mentioned. “It’s in fairly fine condition in the intervening time. There are issues we can not see that would set it off, however I feel the prospect of a recession within the close to time period is low.” Solomon pointed to the buildout of AI infrastructure as a key pressure supporting development.
“You will have six or seven massive firms which might be going to spend $350 billion [combined] this 12 months on AI infrastructure—that has an impact on development,” he mentioned. As AI turns into built-in into enterprise operations, Solomon expects significant productiveness positive factors.
Turning to the nation’s rising debt burden, Solomon mentioned it’ll lead to a “reckoning” if the financial system doesn’t develop quicker. “The trail out actually isn’t a income path out,” he mentioned. “The trail out is a development path.”
The AI increase
When Rubenstein requested whether or not the large market capitalizations of main tech corporations, some nearing $5 trillion, sign a possible bubble, Solomon provided a historic perspective.
“Every time you have got an acceleration in expertise and folks get enthusiastic about it, you see vital capital formation by new firms attempting to capitalize on that chance,” he mentioned. “We’ve seen this earlier than by way of historical past.” He added, “It gained’t be a straight line.” Solomon additional mentioned at present’s AI wave.
The chance set with AI is “huge,” he mentioned. “There can be winners and losers, and it’s onerous to select them now.” A variety of the capital being deployed is not going to produce ample returns—and a few gained’t produce any returns in any respect, he added.
Reflecting on previous funding cycles, Solomon recalled then-Fed Chair Alan Greenspan’s well-known warning about “irrational exuberance” in 1996.
“At the moment, the Nasdaq was close to 1,300,” Solomon defined. “About three and a half years later, it rose above 5,000. In the end, there have been changes and drawdowns.” The pattern for AI funding is actual, he mentioned. “There’s actual productiveness—however these items by no means transfer in a straight line,” he added.
Solomon’s remarks mirror a broader theme throughout Wall Avenue: optimism about AI’s potential to drive development, tempered by consciousness that not each investor, or firm, will come out forward.
Have an excellent weekend.
Sheryl Estrada
sheryl.estrada@fortune.com
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Leaderboard
Fortune 500 Energy Strikes
Homer Bhullar was promoted to SVP and CFO at Valero Power Company (No. 34), efficient January 1, 2026. Bhullar will succeed Jason Fraser, who will stay as EVP and CFO till he steps down on December 31, and can retire as an worker within the first quarter of 2026. Bhullar has served as Valero’s VP of investor relations and finance since April 29, 2021. He joined Valero in 2014.
Paul Todd was appointed CFO of Fiserv, Inc. (No. 208), efficient October 31. Todd, who beforehand served as CFO of World Funds, succeeds Robert Hau, who will function a senior advisor by way of the primary quarter of 2026 to assist a transition. Todd has been serving as a particular advisor to the manager management crew for the final a number of weeks.
Kevin Boone was appointed EVP and CFO of CSX (No. 301), succeeding Sean Pelkey, who has departed the corporate. Boone joined CSX in 2017 and has held a number of key management roles. Most just lately, he served as EVP and chief industrial officer. Boone additionally served as VP of company affairs and investor relations at CSX.
Paul Kuehneman was appointed interim CFO and controller at Hormel Meals Company (No. 352), efficient October 27. Kuehneman succeeds Jacinth Smiley, who’s leaving the corporate and can be pursuing different alternatives, based on the announcement. Kuehneman has greater than 30 years of enterprise and finance expertise at Hormel Meals, holding quite a lot of management roles, most just lately, VP and controller.
Each Friday morning, the weekly Fortune 500 Energy Strikes column tracks Fortune 500 firm C-suite shifts—see the latest version.
Extra notable strikes this week:
Mala Murthy was appointed EVP and CFO of TriNet (NYSE: TNET), a supplier of human sources options, efficient November 28. Murthy will succeed TriNet’s present CFO, Kelly Tuminelli, who will function a particular advisor to the CEO by way of March 16, 2026. Murthy most just lately served as CFO of Teladoc Well being. Earlier than that, she held a number of senior govt positions at American Categorical, together with CFO of its international industrial companies phase. She additionally beforehand served in FP&A, treasury, and company growth and technique management positions with PepsiCo.
Michelle Turner was appointed CFO of Teradyne, Inc. (Nasdaq: TER), a supplier of automated check gear and superior robotics, efficient November 3. Turner replaces Sanjay Mehta, who has served as Teradyne’s CFO since 2019. Turner brings 30 years of economic and strategic management expertise. Earlier than becoming a member of Teradyne, she was the CFO for L3Harris Applied sciences. Turner has additionally held quite a lot of senior monetary administration and management roles in Johnson & Johnson, BHP Billiton, Raytheon, and Honeywell.
Large Deal
Going deeper
Listed here are 4 Fortune weekend reads:
“Crypto founders are getting very wealthy, very quick—once more” by Jeff John Roberts
“Microsoft CEO Satya Nadella says Invoice Gates instructed him his huge guess on OpenAI can be a flop: ‘Yeah, you’re going to burn this billion {dollars}’” by Marco Quiroz-Gutierrez
“Michael Dell’s son goals to rework the house energy enterprise by promoting electrical energy and backup battery energy like a Costco membership” by Jordan Blum
“Harvard professor calls out ‘lie’ of needing 8 hours of sleep an evening, says it’s Industrial Period ‘nonsense’” Ashley Lutz
Overheard
“Silicon Valley is optimizing for the unsuitable metric. Most individuals working in high-stakes domains acknowledge now that AI is not going to take each job, however with that realization comes a tougher fact: the trade has been constructing autonomy when it ought to have been constructing accountability.”
—Joel Hron, chief expertise officer at Thomson Reuters, writes in a Fortune opinion piece.
