Goldman Sachs CEO: AI infrastructure and government spending drive, the US economy will accelerate before 2026

Goldman Sachs Group CEO David Solomon predicts that driven by sustained government spending and strong investment in artificial intelligence infrastructure, U.S. economic growth will accelerate before 2026, while corporate merger and acquisition activity will also heat up further.

On October 3, he stated, "Despite challenges such as tariff impacts and a slowing job market, multiple tailwinds mean the U.S. economy is still in pretty good shape."

Solomon's latest assessment marks a significant shift from his recent views. Just on September 10, he warned that the U.S. economy was softening due to factors such as President Trump's trade policies.

Solomon expects merger and acquisition activity to become more active due to changes in the regulatory environment, while the U.S. stock market may experience a "correction" in the next 12 to 24 months. However, he believes that such a correction is not surprising after a long period of growth, and he "won't lose sleep over it."

Economic Growth Drivers: AI Infrastructure and Government Spending

Solomon believes that government spending and "the construction of all AI infrastructure" are key tailwinds driving the economy positively. These positive forces are sufficient to offset the negative impacts of tariffs and the slowdown in the U.S. job market, keeping the economy in good shape overall.

This judgment contrasts with his previous stance. Solomon had warned in September that the trade policies of the Trump administration were leading to economic weakness. Now, he believes that massive investments in the technology sector, especially in AI-related infrastructure, are injecting new vitality into the economy and will continue to play a role in the coming years.

Despite his optimism about the macro economy, Solomon holds a cautiously optimistic view of the stock market, which has been rising for several years. He predicts that the stock market will experience a "correction" in the next 12 to 24 months.

However, he emphasizes that given the long-term rise of the stock market, especially the significant gains accumulated in large AI-driven tech stocks, a correction is normal and should not cause excessive concern. He stated:

"I won't lose sleep over what might happen next."

Goldman Sachs Itself: Technology-Driven Transformation

Regarding trading activity, Solomon expects the U.S. merger and acquisition market to heat up further. He noted that a "changed regulatory environment" is prompting corporate CEOs to become more ambitious in mergers and acquisitions.

Solomon's optimistic outlook is also reflected in Goldman Sachs' own operational strategy. He revealed that Goldman Sachs will invest $6 billion in technology this year, stating, "We wanted to invest $8 billion, but we can't afford it due to the need to deliver returns."

He acknowledged that technological advancements may lead to "a decrease in the actual number of some jobs," but he expects that Goldman Sachs' overall headcount will still rise over the next decade. Solomon concluded:

"I believe we can continue to grow Goldman Sachs by integrating these tools and capabilities into the firm and changing our processes, allowing us to continue serving a broader client base."