Stimulus and AI Spending to Fuel U.S. Economy
Goldman Sachs CEO David Solomon anticipates that the U.S. economy will accelerate into 2026, powered by sustained government stimulus and massive investments in artificial intelligence infrastructure. Despite recent signs of weakness in the labor market and escalating global tensions, Solomon remains optimistic about the economy’s resilience.
Speaking at Italian Tech Week in Turin, Solomon highlighted the role of federal spending and tech-driven capital expenditure in supporting growth. “All of the AI infrastructure build and government spending means the economy is still in pretty good shape,” he said, even as tariffs and labor softness weigh on certain sectors.
Deal Activity and M&A Set to Rise
Solomon also noted a renewed appetite for mergers and acquisitions across the corporate sector, attributing it to a more favorable regulatory environment. According to the Goldman Sachs chief, corporate leaders in the U.S. are showing greater ambition, signaling that dealmaking could ramp up significantly in the coming quarters.
Despite short-term headwinds, Solomon’s comments suggest confidence in a market landscape where CEOs are willing to pursue strategic expansion — a shift from the cautious stance many companies adopted during earlier periods of volatility.
Equity Market Correction Expected
Solomon did acknowledge potential turbulence ahead, forecasting a market “drawdown” within the next 12 to 24 months. He attributed the risk to the prolonged surge in equity prices, especially in AI-driven tech stocks, but downplayed concerns about a broader economic collapse. “I’m not going to bed every night worrying about what’s happening next,” he said.
This outlook reflects a nuanced stance: while expecting corrections in overvalued sectors, Solomon believes the overall trajectory remains constructive thanks to solid economic underpinnings.
Tech Investment and Workforce Evolution at Goldman
Within Goldman Sachs, Solomon confirmed the firm will spend $6 billion on technology this year, although he noted he would have preferred to invest $8 billion if not for return constraints. These investments aim to enhance productivity and transform internal operations through tech integration.
He also acknowledged that automation and AI will reduce the need for certain job roles. “There are places where the numbers of jobs will come down,” he said. Nonetheless, Solomon expects the bank’s overall headcount to rise over the next decade, as technology enables Goldman to serve a broader range of clients more efficiently.
