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Davos 2023: Goldman Sachs CEO concerned about debt ceiling

Published 01/19/2023, 12:46 PM
Updated 01/19/2023, 12:51 PM
© Reuters. FILE PHOTO: David Solomon, Chief Executive Officer of Goldman Sachs, speaks during the Global Financial Leaders Investment Summit in Hong Kong, China November 2, 2022. REUTERS/Tyrone Siu
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By Lananh Nguyen

DAVOS, Switzerland (Reuters) - Goldman Sachs Group Inc (NYSE:GS).'s Chief Executive David Solomon expressed serious concern on Thursday that a political standoff over the U.S. debt ceiling could lead to a fiscal crisis.

"This is something that we should take very seriously, because the consequence of getting it wrong will be real," Solomon told Reuters in an interview.

"I'm concerned and I'm going to take any opportunity that I can, and we can as a firm, to engage with people in Washington to try to make sure they understand that we don't think that this is something that should be played with."

Solomon echoed other CEOs in Davos who expressed worries about the U.S. potentially defaulting on its debt because of a political stand-off between the Republican-controlled House of Representatives and President Joe Biden's Democrats.

"I don't want to test it, it won't be good. So let's not go there," he said.

Solomon spoke just as the U.S. government hit its $31.4 trillion borrowing limit on Thursday.

© Reuters. FILE PHOTO: David Solomon, Chief Executive Officer of Goldman Sachs, speaks during the Global Financial Leaders Investment Summit in Hong Kong, China November 2, 2022. REUTERS/Tyrone Siu

A stand-off in Washington over raising the debt ceiling has business leaders from Wall Street to Davos worried that this could be as disruptive as the protracted battle of 2011.

That stand-off prompted a downgrade of the U.S. credit rating and years of forced domestic and military spending cuts.

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