Cohn Says 'This, Too, Shall Pass' on Geopolitical Tensions

Summary

Gary Cohn, IBM Vice Chairman, spoke at the 2026 World Economic Forum in Davos about geopolitical tensions, the US economy, the Fed chair race, and the AI data-center buildout. He said geopolitical risks such as Greenland and rare earths should pass, described the 'Sell America' move as modest reallocation rather than liquidation, and remained optimistic on the US market once risks settle. On AI, he argued data-center construction is demand-driven and not inextricably linked to Fed easing, with long-end financing costs more important than Fed funds.

• Gary Cohn discussed Greenland, rare earths, and geopolitical tensions at Davos, calling them likely temporary.
• He said some global funds are trimming US exposure, but he does not see a wholesale Sell America trade.
• Cohn remains bullish on the US economy, citing 5%+ growth and a market takeoff once geopolitical risk settles.
• He commented on the Fed chair race, candidate quality, and the difficulty of swaying the Fed committee.
• Cohn said the AI data-center buildout is driven by demand, not mainly by expected Fed easing.
• He noted Fed funds does not control long-end financing rates, so data-center costs depend more on the medium-to-long curve.
• Market implications include long US equities and AI data-center exposure, with long-end rates as a key watch item.