WEBVTT - David Solomon 0:00:03.200 --> 0:00:05.320 One of the most significant investment banks in the world 0:00:05.360 --> 0:00:08.479 is Goldman Sachs. It's had a gloried history. Recently, I 0:00:08.480 --> 0:00:10.360 had a chance to sit down with the current CEO 0:00:10.440 --> 0:00:13.200 of that firm, David Solomon, to ask him about the 0:00:13.200 --> 0:00:16.799 Federal Reserve, operating Goldman Sachs, and the current economic environment. 0:00:17.520 --> 0:00:21.640 So let's talk about some government matters. Now, you're in Washington, 0:00:22.840 --> 0:00:25.119 the Federal Reserve. You've talked about the importance of the 0:00:25.120 --> 0:00:29.000 FED being independent. So are you worried about the independence 0:00:29.040 --> 0:00:31.880 of the FED? And the Secretary of Treasuries announced five 0:00:31.960 --> 0:00:36.440 potential next chairs of the FED. Any of them or 0:00:36.479 --> 0:00:37.640 all of them acceptable to you? 0:00:40.440 --> 0:00:41.479 Well, let's get right into it. 0:00:41.560 --> 0:00:41.840 David. 0:00:44.680 --> 0:00:46.279 First of all, I just say and I think it's 0:00:46.320 --> 0:00:50.680 a point that's worth emphasizing central bank independence, not just 0:00:50.720 --> 0:00:52.400 here in the United States, but around the world. I 0:00:52.400 --> 0:00:54.760 think it's served us very very well, and I think 0:00:54.800 --> 0:00:57.640 it's something that we should speak out for, we should 0:00:57.640 --> 0:01:00.880 strive for, and I think it's important. I'm not going 0:01:00.960 --> 0:01:02.920 to comment on the individuals other than to say I 0:01:02.920 --> 0:01:06.760 think all five individuals, you know, carry skills and experience 0:01:06.800 --> 0:01:09.000 that could make them credible candidates to be a FED chair. 0:01:09.319 --> 0:01:11.160 I think we all know that there's one person that's 0:01:11.200 --> 0:01:13.440 going to make that decision is to the next Ed Shair. 0:01:13.280 --> 0:01:16.320 And sometimes the government of the United States is moving 0:01:16.640 --> 0:01:20.120 oscillating its policies a bit. Going tariffs are the things 0:01:20.280 --> 0:01:22.800 Has that made it difficult to do well on Wall 0:01:22.840 --> 0:01:25.400 Street for Wall Street firms or the Wall Street firms 0:01:25.440 --> 0:01:27.480 seen to be doing okay? But has the changing in 0:01:27.520 --> 0:01:29.480 policy of what the tariff we're having here or not 0:01:29.560 --> 0:01:31.640 having it or other kinds of things, has it been 0:01:31.760 --> 0:01:34.679 difficult for Wall Street firms to deal with what the 0:01:34.680 --> 0:01:36.559 administration is doing or is actually not a big. 0:01:36.520 --> 0:01:42.000 Problem government policy makers? You know, there's always uncertainty, there's 0:01:42.040 --> 0:01:47.560 always unpredictability in all different kinds of administrations. And I 0:01:47.560 --> 0:01:50.000 think our job as business leaders is to adapt and 0:01:50.040 --> 0:01:52.960 to adjust and deal with it. Can'tidy. I think that's 0:01:53.120 --> 0:01:54.400 that's what I think we do. Right. 0:01:54.480 --> 0:01:56.520 So, the debt of the United States is now thirty 0:01:56.560 --> 0:02:00.200 eight trillion dollars. Some people would say that's a lot. 0:02:00.440 --> 0:02:02.840 Why is the businessman not worried about? As a general, 0:02:02.960 --> 0:02:04.400 they don't seem to be as worried about the thirty 0:02:04.440 --> 0:02:06.560 eight trillion as I would have thought they would be well. 0:02:06.600 --> 0:02:08.079 I speak to a lot of people in the business 0:02:08.080 --> 0:02:09.760 community and a lot of people in the financial community, 0:02:09.760 --> 0:02:12.880 and I think people are worried about the level of 0:02:12.960 --> 0:02:16.040 debt and the fact that we've reached a point. And 0:02:16.080 --> 0:02:17.480 by the way, this is true in the United States, 0:02:17.520 --> 0:02:20.239 but it's true when every developed economy where kind of 0:02:20.280 --> 0:02:24.160 fiscal stimulus and an aggressive fiscal play is really just 0:02:24.240 --> 0:02:28.400 kind of embedded in the way these democratic economies are operating. 0:02:28.560 --> 0:02:32.000 And it's accelerated meaningfully in the last five years. I 0:02:32.000 --> 0:02:35.480 think the pandemic, you know, played an accelerating role, and 0:02:35.800 --> 0:02:37.880 it doesn't seem like we have an ability to pull 0:02:37.919 --> 0:02:40.600 it back. And so we've taken the debt you know, 0:02:40.600 --> 0:02:42.880 in the last fifteen plus years, kind of since the 0:02:42.880 --> 0:02:46.960 financial crisis, from seven trillion to thirty eight trillion, and 0:02:47.120 --> 0:02:50.280 just refinancing it for the rest of the Decade's what's 0:02:50.320 --> 0:02:52.560 got to be refinanced. If you look at current rates, 0:02:54.200 --> 0:02:56.200 you know, is going to grow it into the low forties, 0:02:56.320 --> 0:03:00.480 you know for sure. And we're growing our spending at 0:03:00.639 --> 0:03:02.880 a reasonable rate still, and so this is an issue 0:03:02.880 --> 0:03:06.200 we have to wrestle with now. The path out really 0:03:06.240 --> 0:03:08.040 isn't a revenue path out. The path out is a 0:03:08.040 --> 0:03:10.400 growth path path and you know, if you think about it, 0:03:10.440 --> 0:03:13.360 the difference you know, trend growth is two percent. The 0:03:13.400 --> 0:03:15.760 difference between compound and growth of three percent and two 0:03:15.800 --> 0:03:18.359 percent is monstrous in terms of dealing with this issue. 0:03:19.040 --> 0:03:21.960 So there's a lot of discussion about running, you know, 0:03:22.000 --> 0:03:24.520 a real growth play. I think we have some things 0:03:24.520 --> 0:03:28.080 that are going on that give us a better opportunity 0:03:28.520 --> 0:03:32.239 to have a higher growth trajectory, particularly you know, technology 0:03:32.280 --> 0:03:35.920 AI getting embedded to the enterprise, the productivity opportunity from that. 0:03:36.720 --> 0:03:40.080 But if we continue on the current course and we 0:03:40.280 --> 0:03:43.839 don't take the growth level up, we will there will 0:03:43.840 --> 0:03:46.080 be a reckoning in this. And the bottom line is 0:03:46.440 --> 0:03:48.600 we have to find people, you know, to buy and 0:03:48.640 --> 0:03:52.480 finance our debt. And you know, ultimately it's it's not 0:03:52.520 --> 0:03:54.040 going to be other people around the world. If it 0:03:54.120 --> 0:03:55.440 keeps growing, it's going to turn to us. 0:03:56.000 --> 0:03:58.360 Is Wall Street worried about the fact that government is 0:03:58.600 --> 0:04:01.760 shut down? I mean this is for a long shutdown 0:04:01.880 --> 0:04:04.000 or people on Wall Street saying, well, it don't get 0:04:04.120 --> 0:04:06.080 started again at some point, or have you seen the 0:04:06.120 --> 0:04:08.680 adverse impact on your business as a result of the 0:04:08.720 --> 0:04:09.480 government shutdown. 0:04:09.600 --> 0:04:11.440 I think we all should be concerned about the fact 0:04:11.480 --> 0:04:14.040 that the government shutdown. And I you know, I think 0:04:14.080 --> 0:04:16.680 it's unfortunate that we have government shutdowns, and this one's 0:04:16.720 --> 0:04:19.280 now going on for a period of time. As it 0:04:19.320 --> 0:04:22.480 goes on longer, it starts to have an economic impact, right, 0:04:22.520 --> 0:04:24.920 it starts to filter through the economy. And we're getting 0:04:25.400 --> 0:04:27.159 you know, we're getting to that point in. 0:04:27.040 --> 0:04:29.240 This Who do you think the shutoffs were for the 0:04:29.240 --> 0:04:34.479 shutdown the government? Right, Well, let me ask you. I 0:04:34.480 --> 0:04:38.159 know you're not going to answer that question. So every 0:04:38.200 --> 0:04:40.640 seven years on average, and the US economy has had 0:04:40.640 --> 0:04:43.560 a recession seven year own average. We haven't had a 0:04:43.560 --> 0:04:46.640 recession for quite a while. Are you worried about any 0:04:47.560 --> 0:04:50.080 potential recession coming or you think the economy is in 0:04:50.080 --> 0:04:50.880 pretty good shape? 0:04:51.240 --> 0:04:53.560 Well, I think the economy is in pretty good shape 0:04:53.560 --> 0:04:55.920 at the moment. And I think when you look at 0:04:56.000 --> 0:04:59.400 kind of the give gets, you know, in terms of 0:04:59.400 --> 0:05:02.120 tailwinds that winds are there are more tailwinds. 0:05:01.720 --> 0:05:02.159 At the moment. 0:05:02.160 --> 0:05:04.080 I mean, I go back where we're still running a 0:05:04.080 --> 0:05:08.800 pretty aggressive fiscal you know, fiscal play, the AI infrastructure 0:05:08.839 --> 0:05:11.000 investment boom you have, you know, you've got six or 0:05:11.040 --> 0:05:13.800 seven large companies that are going to spend three hundred 0:05:13.800 --> 0:05:16.840 and fifty billion dollars you know, this year on AI infrastructure. 0:05:16.880 --> 0:05:19.719 That has an effect on growth. We also, after a 0:05:19.760 --> 0:05:24.799 period of kind of heavier regulatory oversight of business broadly, 0:05:25.480 --> 0:05:28.919 there's now a pretty clear by this administration, a pretty 0:05:28.920 --> 0:05:33.120 clear systematic look at regulation and you know, more of 0:05:33.160 --> 0:05:35.960 a view toward what regulation is really necessary and works 0:05:36.000 --> 0:05:38.800 as effective. And that's you know, that's a tailwind for 0:05:38.839 --> 0:05:42.360 growth and so you all and you also have as 0:05:42.400 --> 0:05:45.200 AI gets embedded into the enterprise, you have real productivity gains. 0:05:45.279 --> 0:05:48.200 So we've got a big, diverse economy. It's in pretty 0:05:48.200 --> 0:05:51.119 good shape at the moment. There are things we can't 0:05:51.160 --> 0:05:52.680 see that could set it off, but I think the 0:05:52.800 --> 0:05:55.280 chance of a recession and the near term is low. 0:05:55.760 --> 0:05:58.280 But that's one of the things about sentiment shifts and 0:05:59.160 --> 0:06:02.479 changes and support. You generally don't see them until they're 0:06:02.560 --> 0:06:03.279 right in front of you. 0:06:03.760 --> 0:06:06.360 On AI, some people would say that there's maybe a 0:06:06.400 --> 0:06:08.680 little bit of a bubble in AI. When you have 0:06:08.760 --> 0:06:13.000 companies with market caps of five trillion dollars, you don't 0:06:13.000 --> 0:06:14.440 see any bubble there at all. 0:06:14.600 --> 0:06:18.760 Whenever we have an acceleration in technology and people get 0:06:18.800 --> 0:06:23.560 excited about it. You have significant capital formation around new 0:06:23.560 --> 0:06:26.000 companies that are trying to capitalize on that opportunity. And 0:06:26.040 --> 0:06:29.080 you know, we've seen this before through history, and you're 0:06:29.120 --> 0:06:33.760 seeing it, you're seeing it now. It won't be a 0:06:33.760 --> 0:06:36.960 straight line. The opportunity set with AI is enormous. There 0:06:37.000 --> 0:06:41.240 will be winners and losers, and it's hard to pick 0:06:41.240 --> 0:06:43.960 the winners and losers now. And certainly a lot of 0:06:43.960 --> 0:06:48.120 the capital that's being deployed will not produce adequate returns, 0:06:48.120 --> 0:06:50.760 and a bunch of the capital that's being deployed will actually, 0:06:51.160 --> 0:06:53.320 you know, will actually not produce any returns. 0:06:53.320 --> 0:06:56.239 But dollar is down about eleven percent or so against 0:06:56.240 --> 0:06:59.680 the Euro and some other currencies as well this year. 0:07:00.160 --> 0:07:02.280 Yeah year, I mean in the last fifteen years, it's 0:07:02.320 --> 0:07:03.640 up monstrously. 0:07:03.160 --> 0:07:05.000 Right, But did you worry that it's gone down or 0:07:05.040 --> 0:07:08.320 you think it was overvalued? And as a result of 0:07:08.360 --> 0:07:10.120 it having gone down, you think the chance of a 0:07:10.240 --> 0:07:13.800 Plaza core to orchestrated effort to take it down even 0:07:13.800 --> 0:07:16.760 further is unlikely? And you think the dollar decline now 0:07:16.880 --> 0:07:19.000 is okay, it's suggusted appropriately. 0:07:19.160 --> 0:07:20.400 You know, the dollar has been on a pretty good 0:07:20.480 --> 0:07:22.080 run over a long period of time, and it's certainly 0:07:22.080 --> 0:07:25.040 given back this year given some of the policy actions, 0:07:25.040 --> 0:07:28.160 some of the gains. But fundamentally, the dollar is the 0:07:28.160 --> 0:07:30.680 reserve currency of the world. I don't see anything at 0:07:30.680 --> 0:07:33.040 the moment that threatens that. I'm not concerned that there's 0:07:33.080 --> 0:07:35.960 some fundamental shift. And actually, when you think about digitization 0:07:36.560 --> 0:07:40.080 and tokenization and access to the dollar, you know, over 0:07:40.160 --> 0:07:43.160 time it's actually allowing easier access to the dollar around 0:07:43.200 --> 0:07:45.280 the world, which in the long run is a benefit 0:07:45.280 --> 0:07:46.920 for the dollar and the dollar's position in the world. 0:07:46.960 --> 0:07:50.880 What about crypto? Is crypto now important for Wall Street? 0:07:50.960 --> 0:07:53.520 It's an important business? And are you a big believer 0:07:53.640 --> 0:07:58.320 in the viability and the good investment opportunities? And related 0:07:58.320 --> 0:07:59.200 to crypto. 0:07:58.960 --> 0:08:01.880 I'm a big believer in the technology of the blockchain 0:08:01.960 --> 0:08:06.080 and the ability for us to change the financial infrastructure 0:08:06.120 --> 0:08:10.240 the rails to increase speed and decrease friction, and that's 0:08:10.240 --> 0:08:13.080 a very very good thing for the system. That's different 0:08:13.120 --> 0:08:16.040 than a debate on the long term value of bitcoin. 0:08:16.080 --> 0:08:18.560 I don't have a I think bitcoin looks like a 0:08:18.600 --> 0:08:21.360 store of value. I don't have a real long term view, 0:08:21.640 --> 0:08:23.360 you know, on that a strong long term view, but 0:08:23.400 --> 0:08:28.480 I do. I do have a very strong view about tokenization, digitization, 0:08:28.640 --> 0:08:32.840 stable coins, and innovation around the whole financial infrastructure. It's coming, 0:08:33.240 --> 0:08:35.800 it's coming at a very quick pace, and to the 0:08:35.840 --> 0:08:40.320 degree that it increases speed, reduces friction, and allows for 0:08:40.360 --> 0:08:43.040 a more secure system, I think that's a very very 0:08:43.080 --> 0:08:43.439 good thing. 0:08:43.559 --> 0:08:46.440 So firms like yours seem to have two main businesses. 0:08:46.480 --> 0:08:49.320 I'll say one is investment banking and together is trading, 0:08:49.679 --> 0:08:52.320 which is stronger. Right now, investment banking or trading are 0:08:52.360 --> 0:08:53.079 both doing well. 0:08:53.080 --> 0:08:56.640 They're both big, important businesses, and it's evolved a little bit, David, 0:08:56.640 --> 0:08:58.880 because the way we run these businesses now we run 0:08:58.920 --> 0:09:01.600 it as one business global banking and markets, and it's 0:09:01.640 --> 0:09:05.760 our investment banking, fixed income, currencies and commodities and equities, 0:09:05.760 --> 0:09:08.640 franchises and the RUE is one business. We've obviously had 0:09:08.679 --> 0:09:11.600 an extraordinary leadership position in investment banking and M and A, 0:09:12.240 --> 0:09:16.000 and we've maintained and strengthened that. But in our trading businesses, 0:09:16.040 --> 0:09:18.160 we've increased our wallet share with our clients over the 0:09:18.240 --> 0:09:20.400 last five years by three hundred and eighty basis points, 0:09:20.400 --> 0:09:23.320 and so we've really created an ecosystem by getting these 0:09:23.360 --> 0:09:26.360 businesses to work together as one. Goldman sachs that our 0:09:26.400 --> 0:09:29.040 clients really feel like they've benefited from and so we've 0:09:29.040 --> 0:09:32.199 seen growth in those relatively mature businesses because of that. 0:09:32.360 --> 0:09:35.199 When COVID came, a lot of people work by zoom 0:09:35.840 --> 0:09:38.800 they had to really and then when COVID was over, 0:09:38.960 --> 0:09:41.680 people were urging their employees to come back to work. 0:09:41.720 --> 0:09:43.680 And there's still a little bit of a fight on 0:09:43.679 --> 0:09:46.200 Wall Street about whether people should work in the office 0:09:46.200 --> 0:09:47.760 five days a week or four days a week. What 0:09:47.880 --> 0:09:48.520 is your policy. 0:09:48.640 --> 0:09:52.040 We don't have a policy. We work. Ours is a 0:09:52.080 --> 0:09:56.920 culture of teamwork and collaboration and apprenticeship, and that works 0:09:56.920 --> 0:09:59.160 when people come together. But people also travel to see 0:09:59.160 --> 0:10:01.280 clients and people all so have busy, complex lives and 0:10:01.280 --> 0:10:04.040 we have to give them flexibility. We did that before COVID, 0:10:04.040 --> 0:10:08.000 we do that now. But fundamentally, people show up, they work. 0:10:08.080 --> 0:10:10.600 We don't have rules. They get their jobs done, they're accountable, 0:10:10.840 --> 0:10:14.400 they're present, and you know, we we come together. 0:10:14.480 --> 0:10:16.160 That's what We don't care if they're in the office 0:10:16.200 --> 0:10:17.719 five days or three days, as long as a job 0:10:17.720 --> 0:10:18.320 against done. 0:10:18.200 --> 0:10:20.079 As long as as long as they're doing what they 0:10:20.080 --> 0:10:21.240 need to do. And part of what you need to 0:10:21.280 --> 0:10:22.720 do is you need to be present, You need to 0:10:22.760 --> 0:10:25.240 mentor people. By the way, young people, they're coming to 0:10:25.280 --> 0:10:27.320 Golden Sacks to learn. All these young people we were 0:10:27.320 --> 0:10:29.880 talking about, they want to be present in the office 0:10:29.880 --> 0:10:31.320 and they want senior people around them. 0:10:31.360 --> 0:10:33.440 They want to learn what brings you to Washington other 0:10:33.520 --> 0:10:35.640 than this event, what you're doing and what what are 0:10:35.640 --> 0:10:36.640 you doing in Washington today? 0:10:36.679 --> 0:10:39.720 Principally, fifteen years ago, we created a program at Golden 0:10:39.800 --> 0:10:43.959 Sacks called ten Thousand Small Businesses. We had a thesis 0:10:44.240 --> 0:10:50.160 that if we could provide some boot camp business education 0:10:50.360 --> 0:10:54.240 for small businesses. Given the importance that small businesses play 0:10:54.280 --> 0:10:56.920 in our economy here in the United States, the entrepreneurial spirit. 0:10:56.960 --> 0:10:59.599 I think thirty five percent of the private workforce in 0:10:59.640 --> 0:11:02.880 the United States as small businesses, that if we could 0:11:02.920 --> 0:11:06.320 make an investment in that community and use our expertise, 0:11:06.360 --> 0:11:09.000 our knowledge and transmitted into that community, it would spur 0:11:09.160 --> 0:11:11.960 more investment, more economic growth. A few years ago, we 0:11:12.000 --> 0:11:16.120 created a platform called ten Thousand Businesses Voices to bring 0:11:16.320 --> 0:11:20.200 graduates of that program to d C periodically to go 0:11:20.320 --> 0:11:23.200 up on the hill and spend time with members and 0:11:23.280 --> 0:11:26.000 senators on policy issues. And so we have two thousand 0:11:26.040 --> 0:11:28.400 small businesses here. When you think about the power of 0:11:28.440 --> 0:11:33.760 the US economy, you can't understate how important this entrepreneurial spirit. 0:11:33.800 --> 0:11:35.640 It's different from other places in the world. 0:11:35.920 --> 0:11:39.080 Let's talk about your background. Where were you born. 0:11:39.880 --> 0:11:42.319 I was born in Westchester County, outside New York City, 0:11:42.320 --> 0:11:43.360 White Pins, White Plains. 0:11:43.480 --> 0:11:45.040 Name, And what did your parents do. 0:11:45.280 --> 0:11:49.520 My father had a financial printing business, like mutual fund Perspectuses, 0:11:49.559 --> 0:11:54.520 and you know Perspectus is in Manhattan, a small financial 0:11:54.520 --> 0:11:57.600 printing business. He was actually quite smart. He sold it 0:11:57.640 --> 0:11:59.680 in two thousand to one of the big financial printers 0:12:00.120 --> 0:12:03.040 that didn't exist after twenty ten. So I think he 0:12:03.040 --> 0:12:05.680 made I think he made a good trade. My mom 0:12:05.720 --> 0:12:09.200 was an audiologist at the Berke Rebilitation Hospital in White Plains. 0:12:09.240 --> 0:12:11.160 And were you a star student when you were in 0:12:11.200 --> 0:12:13.320 elementary or junior high school or high school? 0:12:13.920 --> 0:12:15.839 I would not say I was a star student. I 0:12:15.880 --> 0:12:19.640 would say that I was a distracted student, meaning I 0:12:19.679 --> 0:12:23.160 have lots of interests, and you know, studying hard was 0:12:23.200 --> 0:12:25.440 not one of them. There was a point when I 0:12:25.480 --> 0:12:27.480 really kind of got it when I was in college. 0:12:27.880 --> 0:12:32.640 But I would say I coasted more through through high school. 0:12:32.400 --> 0:12:34.280 To an athlete. Were you an athlete? 0:12:34.320 --> 0:12:36.640 I was. I was an athlete, but I was extremely mediocre, 0:12:36.880 --> 0:12:38.400 extremely mediocre. 0:12:38.400 --> 0:12:41.560 I know the feeling. Okay, So, so you went to 0:12:41.600 --> 0:12:44.600 Hamilton College because you admired Alexander Hamilton or. 0:12:44.520 --> 0:12:46.120 Well, I went to Hamilton College because I didn't get 0:12:46.120 --> 0:12:46.720 into Williams. 0:12:48.760 --> 0:12:49.480 Well, but you're the chair. 0:12:49.520 --> 0:12:52.520 But Hamilton College is a great school. I'm really glad. 0:12:52.960 --> 0:12:54.520 I'm really glad that I went there. 0:12:54.600 --> 0:12:55.079 You're the chair. 0:12:55.160 --> 0:12:58.079 I've voted the last twenty five years to service there 0:12:58.320 --> 0:12:59.520 and I do chair the board. 0:12:59.360 --> 0:13:03.200 Of the board. Now, fantastic enact Congratulations. So are you 0:13:03.320 --> 0:13:05.400 graduated from Hamilton? What did you major in? 0:13:06.600 --> 0:13:09.719 I majored in political science and I thought, I really 0:13:09.760 --> 0:13:11.120 thought I was going to go to law school. 0:13:12.440 --> 0:13:14.400 And you didn't miss anything, trust me. 0:13:15.760 --> 0:13:19.600 Well, it was very interesting. You know, all my friends 0:13:19.640 --> 0:13:21.320 were moving to New York and if you really think 0:13:21.320 --> 0:13:25.440 about it was nineteen eighty four and the financial services 0:13:25.480 --> 0:13:27.640 world kind of the bottom of what I would call 0:13:28.520 --> 0:13:31.200 was a long drag from the late sixties to nineteen 0:13:31.240 --> 0:13:33.520 eighty two. I mean the moment would be September fifteenth, 0:13:33.559 --> 0:13:36.520 nineteen eighty two, when the ten year Treasury at fifteen 0:13:36.559 --> 0:13:39.040 point nine percent. We were just starting to come out 0:13:39.040 --> 0:13:41.880 of that and see equities start to start to move 0:13:41.880 --> 0:13:45.120 again in banks and financial firms were creating analyst programs 0:13:45.160 --> 0:13:49.320 and banks were creating training programs, and all my friends 0:13:49.320 --> 0:13:50.960 were going to New York to do this. I didn't 0:13:51.000 --> 0:13:55.079 really know much about finance, but it was an opportunity 0:13:55.160 --> 0:13:58.400 to kind of continue what we were doing in college 0:13:58.440 --> 0:14:01.120 in an apartment in New York and where you could 0:14:01.120 --> 0:14:03.079 earn a salary of twenty two thousand dollars. So I 0:14:03.120 --> 0:14:04.880 got a job at the Irving Trust Company, which was 0:14:04.880 --> 0:14:09.320 a commercial bank and a bank training program, and I 0:14:09.400 --> 0:14:12.800 went to work on Wall Street, actually literally on Wall Street. 0:14:12.840 --> 0:14:15.560 Irving Trust headquarters was number one Wall Street. 0:14:16.000 --> 0:14:18.240 Did you interview for a job at Goldman Sacks and 0:14:18.240 --> 0:14:18.920 get turned down? 0:14:19.000 --> 0:14:21.800 I didn't interview. I sent a letter asking for an interview, 0:14:21.800 --> 0:14:23.840 and I got a reply back saying no, thank you. 0:14:23.920 --> 0:14:25.240 After Irving you went where. 0:14:25.480 --> 0:14:27.560 Back in those days, generally speaking, if you wanted a 0:14:27.600 --> 0:14:29.240 career on Wall Street, you had to go to business school. 0:14:29.840 --> 0:14:32.960 And so in the fall of nineteen eighty five and 0:14:33.000 --> 0:14:35.200 early nineteen eighty six, I was applying to business school, 0:14:36.040 --> 0:14:38.200 but I got an interview at Drexel Burnham Lambert in 0:14:38.200 --> 0:14:41.400 the Hijo bond department and in a small branch of 0:14:41.440 --> 0:14:44.920 it that was based in New York that basically traded 0:14:44.960 --> 0:14:47.520 and sold junk commercial paper if you can believe that 0:14:47.560 --> 0:14:50.320 product existed. And I took that job and went to 0:14:50.360 --> 0:14:53.360 Drexel burning I had a great experience Atdrexel Burnham. I 0:14:53.440 --> 0:14:56.080 learned a lot. My background was all around hyo bonds 0:14:56.120 --> 0:14:56.840 and credit trading. 0:14:57.000 --> 0:14:58.640 But you left before they went bankrump. 0:14:58.760 --> 0:15:01.560 I did. I I was competing for a piece of 0:15:01.600 --> 0:15:04.720 business with a Goldman sax partner's name was John winkel Read. 0:15:06.000 --> 0:15:08.960 And at the end of competing for that piece of 0:15:08.960 --> 0:15:11.440 business and actually doing that piece of business, it was 0:15:11.480 --> 0:15:14.080 actually a financing for Sheldon Adelson, who was building big 0:15:14.080 --> 0:15:17.240 casino hotels in Las Vegas. We raised them one point 0:15:17.280 --> 0:15:21.080 two billion dollars. In nineteen ninety eight, I started getting 0:15:21.080 --> 0:15:23.280 recruited to come to Goldman Sachs and I had been 0:15:23.280 --> 0:15:26.200 in a pretty senior position at bear Stearns, but I 0:15:26.280 --> 0:15:28.280 really thought it was an opportunity to go to work 0:15:28.280 --> 0:15:30.840 for what I believed was, you know, the most extraordinary 0:15:30.840 --> 0:15:31.920 financial firm on Wall Street. 0:15:32.000 --> 0:15:34.720 It's very unusual for it my mid to early career 0:15:34.760 --> 0:15:36.720 to go to Goldman because usually I'd hire people right 0:15:36.760 --> 0:15:38.680 on business score college and you went kind of as 0:15:38.680 --> 0:15:40.800 a lateral, and that was unusual. I assumed you had. 0:15:40.720 --> 0:15:43.680 That at the time. It wasn't unprecedented, but it was. 0:15:44.160 --> 0:15:46.680 It was unusual. The firm was just going public. I 0:15:46.720 --> 0:15:49.640 mean I came right after the IPO, and the firm 0:15:49.680 --> 0:15:52.120 in that year had gone out and hired you know, 0:15:52.240 --> 0:15:56.400 five or six partners that had real credibility because the 0:15:56.400 --> 0:15:58.280 firm was trying to grow and expand its footprints. 0:15:58.360 --> 0:16:00.320 So how many years were you there before where you 0:16:00.360 --> 0:16:01.520 became the CEO? 0:16:01.800 --> 0:16:03.880 Well, I became the CEO in twenty eighteen, so that 0:16:03.920 --> 0:16:05.240 means I was there nineteen years. 0:16:05.440 --> 0:16:07.000 So work your way up. Did you think when you 0:16:07.080 --> 0:16:08.440 join you wind up as a CEO? 0:16:08.760 --> 0:16:10.600 No, I didn't think I would be there for twenty years. 0:16:10.640 --> 0:16:12.680 I remember there was a partner who was a longtime 0:16:12.720 --> 0:16:16.920 partner named Bob Hurst who was talking who it was 0:16:17.040 --> 0:16:18.720 just kind of he was kind of winding down when 0:16:18.720 --> 0:16:21.000 I joined the firm, and I remember being at an 0:16:21.080 --> 0:16:23.200 event with clients and he was talking about all the 0:16:23.240 --> 0:16:24.680 years he had been at the firm, and I remember 0:16:24.720 --> 0:16:26.560 looking him and saying, well, I'll never make that many years. 0:16:26.720 --> 0:16:30.520 You became the CEO in October of twenty eighteen. The 0:16:30.600 --> 0:16:33.680 stock is up roughly three hundred percent since then. The 0:16:33.680 --> 0:16:37.520 market capitalization's up roughly three hundred percent, So people are 0:16:37.520 --> 0:16:38.440 pretty happy with you. 0:16:38.560 --> 0:16:41.800 I assume this week, I mean, you know, so you. 0:16:41.920 --> 0:16:45.040 Came out with your earnings, because last week your earnings 0:16:45.040 --> 0:16:48.080 were up per share I guess forty one percent per share, 0:16:48.120 --> 0:16:50.720 forty six percent, forty six percent over a year of year. 0:16:51.560 --> 0:16:53.560 But the stock went down two percent. And how can 0:16:53.600 --> 0:16:55.320 that be given how well you did. 0:16:55.360 --> 0:16:57.360 I guess they wanted earnings to be up fifty five percent. 0:16:57.440 --> 0:17:00.000 I mean, you know, we we really don't. I mean 0:17:00.280 --> 0:17:02.360 it's hard for me because like any human being, you know, 0:17:02.600 --> 0:17:04.720 I have the screen on my desk or on my phone. 0:17:05.080 --> 0:17:08.760 But we're really you know, twenty eighteen, when this leadership 0:17:08.760 --> 0:17:11.600 team started, you know, through twenty eighteen, the end of 0:17:11.600 --> 0:17:15.280 twenty eighteen to twenty nineteen, we really developed a strategy 0:17:15.280 --> 0:17:17.320 to grow the firm, and we've made real progress, and 0:17:17.320 --> 0:17:19.520 we've grown the firm very materially. I mean, the market 0:17:19.520 --> 0:17:22.520 cap has grown as you highlight because we've grown the revenues. 0:17:22.800 --> 0:17:25.080 We've not quite doubled the revenues. We've taken the revenues 0:17:25.080 --> 0:17:27.560 from mid thirties to almost sixty and we've grown the 0:17:27.600 --> 0:17:30.800 earnings very very materially, and that's grown the market cap. 0:17:31.200 --> 0:17:34.240 And so we're executing on that strategy. And I think 0:17:34.280 --> 0:17:37.560 we've got a great strategy, an incredible team. We've got 0:17:37.600 --> 0:17:39.679 a client. We're incredibly focused on our clients and our 0:17:39.680 --> 0:17:43.520 client franchise, and you know, the stock will follow. Our 0:17:43.600 --> 0:17:46.280 job is to execute, to be patient, to take a 0:17:46.320 --> 0:17:48.720 long view. There will be cycles. At the moment, we're 0:17:48.720 --> 0:17:50.600 in a constructive cycle, so it feels like there are 0:17:50.640 --> 0:17:53.359 lots of tailwinds. There'll be more headwinds, but you know, 0:17:53.400 --> 0:17:55.560 over the next five years, I think we will continue 0:17:55.600 --> 0:17:58.280 to grow the firm, continue to deliver for our clients, 0:17:58.280 --> 0:17:59.800 and continue to deliver for shareholders. 0:18:00.320 --> 0:18:02.600 What percentage of your employees are not men? 0:18:02.760 --> 0:18:05.600 We've made a bunch of progress, especially in the senior rankspeicendily, 0:18:05.640 --> 0:18:08.879 not enough and we continue to be focused on creating opportunities, 0:18:08.880 --> 0:18:10.120 but it's a long, long road. 0:18:10.240 --> 0:18:13.080 What are the skill sets that enables somebody to rise 0:18:13.119 --> 0:18:13.480 up at. 0:18:13.400 --> 0:18:17.680 Goldman Goldman's no different than any other professional services firm. 0:18:17.840 --> 0:18:20.240 You know, I think one of the things that's important 0:18:20.240 --> 0:18:23.040 to be successful in a professional services firm is you 0:18:23.160 --> 0:18:27.840 have to enjoy interacting with people. It's a people business 0:18:27.840 --> 0:18:30.159 inside the firm because you work collaboratively on teams and 0:18:30.160 --> 0:18:33.440 you work collectively for the betterment of a group out 0:18:33.440 --> 0:18:36.000 of the firm. And you have to like working with clients. 0:18:36.040 --> 0:18:37.439