David Solomon

"The macro setup is quite good... you have this combination of strong fiscal stimulus... capital investment surge around AI... huge deregulatory swing." Solomon outlines a "constructive environment" with three major tailwinds (Stimulus, AI Capex, Deregulation) and forecasts 2.9% real GDP growth. This combination historically drives equity market performance. LONG US equities to capture the forecasted growth and favorable policy environment. Inflation reigniting due to stimulus; failure of AI capex to generate returns.

The interviewer notes that Goldman's strategy team, led by Peter Oppenheimer, is explicitly saying to "buy the dip." Solomon adds that for wealth clients, "there's nobody that's saying you should change your fundamental portfolio allocation." Despite the geopolitical noise, the "Smart Money" (Goldman) views the current conflict as a volatility event rather than a fundamental cycle-ender. If the recommendation is to not alter long-term allocation and to buy weakness, the trade is to remain long broad US equities. LONG broad indices as the baseline view is that the conflict will be contained. A sudden escalation that drags the US directly into kinetic warfare, causing a market-wide repricing.

"Chinese markets have done very well in the last 12 months. That's increased capital flows into the region." He also notes an upcoming meeting between President Trump and President Xi in April. Solomon confirms the momentum trade in China is active and capital is returning. The upcoming diplomatic engagement provides a potential catalyst for further stability or clarity, supporting the ongoing rally. LONG based on confirmed capital inflows and price momentum. The Trump-Xi meeting results in increased trade friction or tariffs; the "fragile" relationship deteriorates.

"Chinese markets have done very well in the last 12 months. That's increased capital flows into the region." He also notes an upcoming meeting between President Trump and President Xi in April. Solomon confirms the momentum trade in China is active and capital is returning. The upcoming diplomatic engagement provides a potential catalyst for further stability or clarity, supporting the ongoing rally. LONG based on confirmed capital inflows and price momentum. The Trump-Xi meeting results in increased trade friction or tariffs; the "fragile" relationship deteriorates.

AI is a "technology supercycle" that will drive "massive productivity gains." He states, "There's a lot of capital being deployed to grow AI capabilities around the world." While he mentions there will be losers, the massive capital deployment phase benefits the infrastructure providers (chips) and the platforms integrating the tech (productivity software). The "glass half full" view suggests the spending cycle is not over. LONG the "picks and shovels" of the capital deployment phase. Over-investment leads to capital destruction in the short term if returns on AI don't materialize quickly.

AI is a "technology supercycle" that will drive "massive productivity gains." He states, "There's a lot of capital being deployed to grow AI capabilities around the world." While he mentions there will be losers, the massive capital deployment phase benefits the infrastructure providers (chips) and the platforms integrating the tech (productivity software). The "glass half full" view suggests the spending cycle is not over. LONG the "picks and shovels" of the capital deployment phase. Over-investment leads to capital destruction in the short term if returns on AI don't materialize quickly.

"You have a pretty significant capital investment surge around AI and this technology, which is obviously... very stimulative to the economy." Solomon identifies AI capex as a core pillar of the current economic strength. Continued "surge" in investment implies sustained revenue for the AI infrastructure and technology value chain. LONG AI Sector to align with the massive capital deployment cycle Solomon describes. Overinvestment leading to a capex trough if ROI disappoints.

"Smaller IPOs require... more discount... smaller companies it's always more attractive to sell a company for 100% of its value and get that cash today privately." While the IPO market is opening for large caps, Solomon notes that small companies are better off selling privately. This dynamic feeds deal flow to Private Equity firms and alternative asset managers who act as the buyers/consolidators in private markets. LONG Private Equity managers (like Blackstone/KKR) who benefit from robust private market transaction volume. Higher interest rates impacting leverage costs for private deals.

"Smaller IPOs require... more discount... smaller companies it's always more attractive to sell a company for 100% of its value and get that cash today privately." While the IPO market is opening for large caps, Solomon notes that small companies are better off selling privately. This dynamic feeds deal flow to Private Equity firms and alternative asset managers who act as the buyers/consolidators in private markets. LONG Private Equity managers (like Blackstone/KKR) who benefit from robust private market transaction volume. Higher interest rates impacting leverage costs for private deals.