# South Korean Stocks Rebound, China NPC Begins, Goldman Sachs CEO David Solomon

An episode of [Bloomberg Daybreak: Asia Edition](https://invisiblenetwork.ai/podcast/1663863437), 5 Mar 2026, 22 min.

Audio: https://podtrac.com/pts/redirect.mp3/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/58e85be7-dbb5-4043-afed-af80014dc0b3/90e32e4a-3c34-475b-8cce-b404003493ea/audio.mp3?utm_source=Podcast&in_playlist=27143354-63aa-4ac5-965d-af80014dc0d3

Business and finance news from the Asia-Pacific. Asian equities rebounded, with South Korea leading gains after its worst rout on record, as sentiment showed signs of a recovery following an initial bout of volatility sparked by the Middle East conflict. In China, they set a growth target of 4.5% to 5%, its most modest in more than three decades, in a shift towards more sustainable growth drivers. For more, we turn to Lianting Tu, Bloomberg's Managing Editor for Asia Equities. Plus - Goldman Sachs Group Chief Executive Officer David Solomon said he's watching the private credit market for 'frothiness,' though he hasn't seen anything that gives him significant cause for concern. Speaking on the sidelines of the firm's inaugural 'Australia Week,' Solomon exclusively told Bloomberg that markets' 'benign' reaction reflects cautious stance on figuring out the endgame. He also shared his 'glass half full' outlook on the prospects for artificial intelligence. See omnystudio.com/listener for privacy information.

## Transcript

[0:00] Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
[0:11] Speaker 2: Welcome to the Daybreak Asia podcast. I'm Doug Krisner. We'll
[0:14] Speaker 2: begin with crude oil today, which is moving higher for
[0:17] Speaker 2: a fifth straight session as the market assesses the widening
[0:20] Speaker 2: fallout from the US Israeli war against Iran and the
[0:24] Speaker 2: combatants are vowing to press on. Now we are learning
[0:28] Speaker 2: that Kurdish Iranian dissident groups based in northern Iraq are
[0:32] Speaker 2: preparing for a potential cross border military operation in Iran.
[0:36] Speaker 2: At the same time, today, we're seeing a rebound in
[0:39] Speaker 2: equity markets across the Asia Pacific after an up arrow
[0:42] Speaker 2: story for US talks in South Korea. For example, a
[0:46] Speaker 2: powerful rebound is underway following Wednesday's twelve percent sell off
[0:50] Speaker 2: for the Cosby For a closer look, now, I'm joined
[0:53] Speaker 2: by Bloomberg's Leonting III. Leonting is Managing editor for Asia Equities,
[0:58] Speaker 2: and she joins from our studios in seeing Thank you
[1:00] Speaker 2: for being here. Can you help me understand what's going
[1:03] Speaker 2: on with the South Korean equity market today?
[1:06] Speaker 3: The story about Korea basically is a cautionary tell about
[1:10] Speaker 3: leveraged bets to buy into stocks. Yesterday we saw you know,
[1:16] Speaker 3: the record sell of ever for Korean stocks, more than
[1:19] Speaker 3: twelve percent drop, and that was really because the retail
[1:22] Speaker 3: investors leading into the wall, going into the war, they
[1:26] Speaker 3: were just wrong footed, right. They took out the record
[1:30] Speaker 3: amount of debt, and they also put a lot of
[1:34] Speaker 3: money into brokerage accounts just sort of to get ready
[1:38] Speaker 3: to buy more Korean stocks. So a lot of that
[1:42] Speaker 3: buying was really financed by debt, by margins. So that
[1:48] Speaker 3: has caused a lot of liquidation in a day when
[1:52] Speaker 3: the market plunged. So we see a lot of technicalism
[1:55] Speaker 3: behind that, right force liquidation, a lot of gapping down
[1:59] Speaker 3: and that that's a result of a historic slump that
[2:03] Speaker 3: we saw yesterday. But today I think there was a
[2:07] Speaker 3: lot of buyer orders leading into today's open again. Retail
[2:11] Speaker 3: investors even yesterday, some of the brave hearted were buying
[2:15] Speaker 3: into long leverished ETFs. So there are a lot of
[2:18] Speaker 3: sort of still bullish people out there looking to buy
[2:22] Speaker 3: the dip. So today's huge rebound is reflective of that.
[2:27] Speaker 3: And foreign investors yesterday I wanted to highlight they were
[2:30] Speaker 3: actually already buyers. We saw at the end of the
[2:33] Speaker 3: day about one billion dollars of foreign inflow into the
[2:38] Speaker 3: market yesterday. So that kind of inflow I think today
[2:41] Speaker 3: is translating into the big jump pop as well.
[2:44] Speaker 2: So when you look at market internals leon ting, is
[2:47] Speaker 2: it still technology related and is that trade directly correlated
[2:51] Speaker 2: with artificial intelligence?
[2:54] Speaker 3: Yes, it's very much so, I think a career You know,
[2:57] Speaker 3: if you look at the overnight trading in a Korea
[3:00] Speaker 3: ETF in the US, there was almost no sign that
[3:03] Speaker 3: that was a big crash in South Korea, you know,
[3:06] Speaker 3: earlier in the day e w Y I think that
[3:09] Speaker 3: was a ticker for the I shares career ETF was
[3:12] Speaker 3: it was up during the night and there was still
[3:15] Speaker 3: flows into it, which means global investors, not just the
[3:20] Speaker 3: career ones, are still sort of very much bullish about
[3:23] Speaker 3: this career story about memoryship shortage, about how they're being
[3:28] Speaker 3: well positioned in this AI supply chain. So that to
[3:32] Speaker 3: me is quite shocking, right almost to global investors, nothing
[3:36] Speaker 3: happened in Korea. People continue to buy into this US
[3:39] Speaker 3: ETF of Korea.
[3:41] Speaker 2: So Leonteng, we're getting some headlines out of the National
[3:44] Speaker 2: People's Congress in China. The growth target has been set
[3:47] Speaker 2: in a range of between four and a half to
[3:49] Speaker 2: five percent. I think that's the most modest we've seen
[3:52] Speaker 2: in about three decades. Some analysts were saying earlier this
[3:56] Speaker 2: is in effect and admission that China's model economic model
[4:00] Speaker 2: that has powered the country's rapid rise is now beginning
[4:03] Speaker 2: to show a little strain. How would you describe what's
[4:07] Speaker 2: emerging from the NPC.
[4:10] Speaker 3: Yeah, the growth targeted between four point five percent to
[4:13] Speaker 3: five percent has been very well telegraphed, so that bit
[4:18] Speaker 3: of information is not a surprise to market participants at all.
[4:22] Speaker 3: Hijinpin's government has been talking about how they wanted the
[4:26] Speaker 3: quality of growth, not just a pure number in the
[4:30] Speaker 3: GDP figure, So that's again well understood by market participants.
[4:35] Speaker 3: So we've asked ten people so far on what's the takeaway.
[4:39] Speaker 3: Everybody has said right now, they're not seeing market moving
[4:43] Speaker 3: news so far out of the NPC. The stuff that
[4:46] Speaker 3: came out, including promotion of human robot and also the
[4:53] Speaker 3: AI AI related industry breakthroughs and all that has been
[4:58] Speaker 3: sort of reiteration of what we heard before. I think
[5:02] Speaker 3: one more thing to watch out for is the kind
[5:04] Speaker 3: of plans to boost consumption, to lift to the proportion
[5:08] Speaker 3: of consumption in China's GDP that we haven't really seen
[5:13] Speaker 3: anything super concrete that has come out of yet, but
[5:16] Speaker 3: so far, I think Chinese market today is just being
[5:19] Speaker 3: lifted along with global markets. Asia so far has been
[5:23] Speaker 3: the worst hit in global stock market since the war began.
[5:27] Speaker 3: I think China wasn't spared and today again it's just
[5:31] Speaker 3: sort of the rising boat lifting all tides.
[5:34] Speaker 2: You know, we know well that the story in China
[5:37] Speaker 2: lately in terms of prices has been one of deflation
[5:41] Speaker 2: and so the government's had a CPI growth target for
[5:44] Speaker 2: this year of around two percent. How do you think
[5:46] Speaker 2: they're going to achieve that? Is that going to come
[5:49] Speaker 2: strictly from more government spending?
[5:53] Speaker 3: There has been room for fscal spending. I think the
[5:57] Speaker 3: deficit is still at record high. That was the latest
[6:01] Speaker 3: target four percent, But it is very very challenging work
[6:07] Speaker 3: to get CPI up to percent. Part of it is
[6:10] Speaker 3: because there is a lot of competition and a lot
[6:15] Speaker 3: of sort of glut of supply in all sorts of things, materials,
[6:18] Speaker 3: even services that we saw in China. Part of it,
[6:23] Speaker 3: as you as we reported, is you know even in
[6:26] Speaker 3: the tech space, right food delivery wall that's been going
[6:31] Speaker 3: on of course, solar is oversupplied, lithium is oversupplied, and
[6:37] Speaker 3: latest oversupply that we're seeing is actually AI application models.
[6:42] Speaker 3: Every other tech company has an AI model that they
[6:45] Speaker 3: wanted to promote, and that has really added pressure on
[6:50] Speaker 3: all these Internet names, stock names, I should say, just
[6:53] Speaker 3: because they're spending so much to get user sign ups
[6:58] Speaker 3: for their latest AI app. So that's really pressure in margins. Again,
[7:02] Speaker 3: that doesn't reflect well for their stocks in the stock market,
[7:07] Speaker 3: and overall for economy. That just adds to challenge of
[7:10] Speaker 3: reaching that two percent CPI.
[7:12] Speaker 2: Go I mentioned the push higher for crude oil, and
[7:14] Speaker 2: when you consider economies like South Korea, like Japan that
[7:17] Speaker 2: are heavy oil importers, what is the sense of the
[7:22] Speaker 2: risk of inflation picking up as a result of higher oil?
[7:25] Speaker 2: Is that something that people are talking about. Is there
[7:27] Speaker 2: a great deal of concern being expressed along those lines.
[7:31] Speaker 3: Not really for China. The interesting thing about China is
[7:35] Speaker 3: China's now tarted at the biggest beneficiary of this oil
[7:38] Speaker 3: crisis that we're seeing right now. Part of it is
[7:41] Speaker 3: because it China gets its oil from Russia mainly right
[7:45] Speaker 3: and also it can still get from Iran, it can
[7:48] Speaker 3: still get from Venezuela. So China actually has a lot
[7:52] Speaker 3: of friends in the global cells to get oil supply
[7:55] Speaker 3: from these countries, so that sort of spared from buying
[8:01] Speaker 3: you know, the recently searched oil prices. So it's a
[8:06] Speaker 3: very well positioned market when it comes to energy supply
[8:10] Speaker 3: right now.
[8:11] Speaker 2: So I mentioned the conflict with Iran earlier, and another
[8:14] Speaker 2: headline that has emerged from the NPC is China's plan
[8:18] Speaker 2: to increased defense spending by seven percent. That's the slowest
[8:22] Speaker 2: sense about twenty twenty two, and I'm curious as to
[8:24] Speaker 2: whether anyone surprised by that number.
[8:28] Speaker 3: I would say, yes, that's probably one surprise that has
[8:31] Speaker 3: come out of the NPC so far. But there are
[8:36] Speaker 3: people saying that, you know, China, Yeah, the official number
[8:39] Speaker 3: may be seven percent, but China has many other ways
[8:42] Speaker 3: to spend on defense, so the actual number that may
[8:45] Speaker 3: not be released to the public could be a lot
[8:47] Speaker 3: higher than that. And of course, for China, defense is
[8:51] Speaker 3: just becoming increasingly important as we're seeing what's going on
[8:54] Speaker 3: in Iran. There's a lot of concern about, you know,
[8:57] Speaker 3: what's going to happen to Taiwan in the next couple
[9:00] Speaker 3: of years. Before she Jimpin steps down, So I would
[9:04] Speaker 3: say defense is of critical importance and China really, you know,
[9:09] Speaker 3: will not that slip in terms of the technological breakthrough
[9:14] Speaker 3: in the defense sector relative to the rest of the road,
[9:17] Speaker 3: especially with the US.
[9:19] Speaker 2: Leonting will leave it there. Always a pleasure. Thank you
[9:21] Speaker 2: so much, Bloomberg's Leon ting iiO. She is Managing editor
[9:24] Speaker 2: for Asia Equities, joining from our studios in Singapore here
[9:27] Speaker 2: on the Daybreak Asia podcast. Welcome back to the Daybreak
[9:38] Speaker 2: Asia Podcast. I'm Doug Prisner. Financial markets are still facing
[9:42] Speaker 2: tremendous uncertainty as the conflict in Iran enters its fifth
[9:46] Speaker 2: day and it shows no sign of abating. Tehran is
[9:49] Speaker 2: targeting Israel and Gulf states, and at the same time,
[9:52] Speaker 2: Israeli and US forces have been bombing targets in the
[9:55] Speaker 2: Islamic Republic that would include the US sinking and Iranian
[9:59] Speaker 2: warship in international waters. It was on Tuesday when Goldwyn
[10:03] Speaker 2: Sachs CEO David Solomon expressed surprise at what he called
[10:07] Speaker 2: the market's benign reaction. On Wednesday, Solomon spoke with Bloomberg's
[10:11] Speaker 2: Heidi Stroud Watts in Sydney.
[10:13] Speaker 1: Your team of strategists led by Peter Oppenheimer is saying,
[10:16] Speaker 1: by the too, do you see complacency at this moment?
[10:20] Speaker 4: I don't see complacency.
[10:22] Speaker 5: I just I think there's a lot of uncertainty around
[10:25] Speaker 5: the direction of the conflict, how it will be resolved,
[10:29] Speaker 5: you know, what the off ramps are, and you know,
[10:31] Speaker 5: I think it's fair to say when you look at markets,
[10:33] Speaker 5: market reactions have been relatively benign, and I certainly could
[10:37] Speaker 5: have seen over the last couple of days, you know,
[10:38] Speaker 5: a little bit more volatility. But I don't think people
[10:41] Speaker 5: are being complacent. I think that market participants are looking
[10:45] Speaker 5: and trying to say, you know, how is this going
[10:48] Speaker 5: to play out? What's the end game? You can see,
[10:50] Speaker 5: you know, good scenarios and more difficult scenarios, and as
[10:54] Speaker 5: they have more information in the coming days, the coming
[10:56] Speaker 5: week or two, you know, I think that will have
[10:58] Speaker 5: an impact on risk premiums. I think the moment, what
[11:00] Speaker 5: market participants are really looking at is is this going
[11:03] Speaker 5: to translate through to things that affect economic growth and activity,
[11:06] Speaker 5: particularly energy supply chains, you know so far.
[11:08] Speaker 4: I think one of the reasons why markets are.
[11:10] Speaker 5: Reacting the way they are is they're encouraged that there
[11:14] Speaker 5: is you know, strong support for trying to ensure that
[11:18] Speaker 5: doesn't happen. But it's uncertain. You don't know, and we'll
[11:21] Speaker 5: see in the long run. For portfolio allocation, and I
[11:24] Speaker 5: know Peter Oppenheimer, Charmin, most of bar Ramari need it
[11:28] Speaker 5: a call for our wealth clients. You know, if you
[11:30] Speaker 5: have portfolio allocation, there's nobody that's saying you should change
[11:33] Speaker 5: your fundamental portfolio allocation because of what's going on. But
[11:36] Speaker 5: for traders and day to day market participants to think
[11:39] Speaker 5: about risk premia, you know every single day.
[11:41] Speaker 4: Obviously they're watching very closely what a.
[11:43] Speaker 1: Lot of people that run big, major global banks like yours, right,
[11:46] Speaker 1: do you worry about the lack of predictability when it
[11:48] Speaker 1: comes to policy, when it comes to how this potentially ends,
[11:51] Speaker 1: and when it ends, what's going on with your at
[11:54] Speaker 1: least operations For anxiety.
[11:56] Speaker 5: I worry about a lot of things. We run a
[11:58] Speaker 5: big global business. We have an extraord very team, and
[12:01] Speaker 5: you know, I think one of the things that we
[12:03] Speaker 5: have to accept is the world is a very complicated place.
[12:06] Speaker 5: There's always a lot of uncertainty, there's always a lot
[12:08] Speaker 5: of nuance. But we have you know, base beliefs and
[12:12] Speaker 5: how economies will perform, how the world.
[12:15] Speaker 4: Will evolve, and you know we operate around that.
[12:17] Speaker 5: But we always are prepared to risk manage and think
[12:20] Speaker 5: about downside risks. And I think one of the things
[12:22] Speaker 5: you have to do when you run a big, large
[12:23] Speaker 5: financial institution is that when you know fact change or
[12:27] Speaker 5: risk come up, you've always got to be prepared to
[12:29] Speaker 5: pivot to shift to d risk. And you know, we
[12:32] Speaker 5: run our business, you know that way always. We run
[12:33] Speaker 5: a big balance sheet and we you know, we think
[12:35] Speaker 5: about that every day. But there's there's nothing while these
[12:38] Speaker 5: are very very significant events and I don't want to
[12:40] Speaker 5: diminish them in any stretch. You know, we've operated the
[12:43] Speaker 5: firm through lots of very significant events.
[12:46] Speaker 4: You're in year out, and that's that's part of what
[12:47] Speaker 4: we do.
[12:48] Speaker 2: Is it business is normal?
[12:49] Speaker 1: Then for say your offices in Saudi Arabia, is this
[12:52] Speaker 1: travel going on? What's a communication?
[12:53] Speaker 4: The third clients, that's that is complex.
[12:56] Speaker 5: We have We've got a significant number of people in
[13:00] Speaker 5: and you know in those Middle East countries and obviously,
[13:02] Speaker 5: first and foremost we're concerned with their safety and you know,
[13:06] Speaker 5: we're trying to do everything we can to support them
[13:08] Speaker 5: in their families. I would not say, you know, as
[13:10] Speaker 5: business as usual in those markets. You know, all those
[13:13] Speaker 5: markets for all businesses you know are operating work from
[13:16] Speaker 5: home and and you know, stay safe as a first priority,
[13:19] Speaker 5: and so we'll just have to watch closely, you know,
[13:21] Speaker 5: how things play out. And you know, we're very, very
[13:24] Speaker 5: focused on making sure our people and their families are
[13:27] Speaker 5: safe and sound, and at the moment, that's our primary
[13:29] Speaker 5: focus in that part.
[13:30] Speaker 4: Of the world.
[13:30] Speaker 1: Do you think there is a bit of an existential
[13:32] Speaker 1: cloud of a Dubai's a financial center, now.
[13:35] Speaker 5: Well, you know, I do think safety and security, you know, matters,
[13:38] Speaker 5: and I wouldn't say I think it's a little bit
[13:41] Speaker 5: premature to talk about existential clouds. But you know, if
[13:46] Speaker 5: you're living and operating in a place and you didn't anticipate.
[13:48] Speaker 4: This, it's quite scary and it's quite unsettling.
[13:52] Speaker 5: And so, as I said, our primary focus is on
[13:54] Speaker 5: the safety and security of our people there, were working
[13:57] Speaker 5: very hard to make sure that we're protecting them in
[13:59] Speaker 5: their families.
[13:59] Speaker 1: It's not as so the background prior to this conflict
[14:02] Speaker 1: was was crystal clear, right. We just came off really
[14:05] Speaker 1: trying to work out what the AI scare trade was
[14:07] Speaker 1: going to be. Like, do you still think that when
[14:10] Speaker 1: it comes to that narrative of sustainability of you know,
[14:13] Speaker 1: I know Jami Dahmond said there's some players doing dumb
[14:15] Speaker 1: things for example, does that still have.
[14:17] Speaker 4: Further to go?
[14:20] Speaker 5: I'm not sure I understood the question exactly are you're
[14:22] Speaker 5: talking about kind of AI investment, you know, growth. Look,
[14:25] Speaker 5: AI is a fabulous, fabulous, incredible technology that is going
[14:28] Speaker 5: to drive massive productivity gains through society. There's a lot
[14:32] Speaker 5: of capital being deployed to grow AI capabilities around the world.
[14:36] Speaker 5: Some of that capital is going to get reasonable returns.
[14:38] Speaker 5: Some of that capital is not. They're going to be winners,
[14:41] Speaker 5: They're going to be losers. As within any technology super cycle,
[14:45] Speaker 5: I think we're early in that process, but I think
[14:48] Speaker 5: it's exciting and I actually look at the glass being
[14:50] Speaker 5: half full. That doesn't mean that there won't be you know,
[14:53] Speaker 5: capital that's burned, companies that don't work out. But I
[14:56] Speaker 5: think overall, the benefits to enterprise productivity, you know, the
[14:59] Speaker 5: accomp I mean broadly, as this technology gets developed and deployed,
[15:03] Speaker 5: is going to be quite exciting. And I'm looking at
[15:05] Speaker 5: the optimism of you know, what's ahead from all this,
[15:08] Speaker 5: and of course try to manage the risk of downside,
[15:09] Speaker 5: the speed bumps that will inevitably come along the way.
[15:12] Speaker 1: I like the earlier you said, you know, in your job,
[15:14] Speaker 1: you worry about a lot of things, right trade tariffs,
[15:17] Speaker 1: US policy is obviously one of them. And I think
[15:19] Speaker 1: this is the first time we've spoken to you since
[15:21] Speaker 1: the Supreme Court passed down their judgment. Does the further
[15:24] Speaker 1: lack of predictability on trade policy? Is that also a
[15:27] Speaker 1: concern when it comes to business sentiment, when it comes
[15:29] Speaker 1: to your views on how the US economy is going
[15:31] Speaker 1: to cope?
[15:32] Speaker 5: You know, I think uncertainty does affect business sentiment broadly,
[15:35] Speaker 5: But I just say I don't think that. I don't
[15:37] Speaker 5: think that at the moment, US trade policy is that uncertain,
[15:42] Speaker 5: you know. I think this administration has been clear about
[15:45] Speaker 5: how they intend to drive a trade policy. I think
[15:48] Speaker 5: the Supreme Court decision affects a certain discharge of tariffs
[15:54] Speaker 5: into the economy, but there's certainly other avenues for the president.
[15:57] Speaker 5: I think the President's made quite clear, you know, how
[15:59] Speaker 5: we thinks about tariff and trade. And I think while
[16:02] Speaker 5: this administration is in place that is going to be
[16:03] Speaker 5: a construct that we have to operate in. Of course,
[16:06] Speaker 5: if there could be more can be more certainty around
[16:09] Speaker 5: exactly how that looks, And I think the important thing
[16:12] Speaker 5: is how it will look in longer perpetuity. You know,
[16:16] Speaker 5: of course the market would appreciate that, but I think
[16:18] Speaker 5: the market operates knowing that there's a level uncertainty around
[16:20] Speaker 5: trade and trade policy that we just have to adapt to.
[16:23] Speaker 4: And we have to live with.
[16:24] Speaker 1: I wanted to get a bit more on while you're here,
[16:26] Speaker 1: for example in beautiful Sydney Times, that base of increased
[16:30] Speaker 1: global and certainty, does it make a relatively more idiosyncratic
[16:34] Speaker 1: market like Australia more interesting.
[16:36] Speaker 4: Well, Australia has always been interesting market.
[16:37] Speaker 5: We have four hunder people here that are a lot
[16:39] Speaker 5: of very very important companies in Australia. We have a
[16:42] Speaker 5: good wealth business in Australia. You know, Australia is an
[16:45] Speaker 5: important market and an important economy, not just for the world,
[16:48] Speaker 5: but also for Golden Sex. You know, any market, any
[16:50] Speaker 5: economy that's important is important for gold and Sex. Given
[16:52] Speaker 5: our global footprint. I try to get here about once
[16:55] Speaker 5: a year. I try to do it around an.
[16:57] Speaker 4: Event like this.
[16:58] Speaker 5: So we've got a lot of our clients for together
[17:00] Speaker 5: first of all for this conference. But this has always
[17:03] Speaker 5: been you know, this has always been an important market,
[17:05] Speaker 5: an important economy for Golden Sacks, and you know, I
[17:08] Speaker 5: think that's consistent, you know, in any environment. So I
[17:12] Speaker 5: was here the same week last week, and I'm excited
[17:14] Speaker 5: to be back again this year.
[17:16] Speaker 1: What else are you excited about around the region? Are
[17:18] Speaker 1: there as a house view comment SECT is very bullish
[17:21] Speaker 1: on China or it's of course National People's Congress week
[17:23] Speaker 1: as well. What's your feel about that market given some
[17:26] Speaker 1: of the crosswinds on trade, on tech, on geopolitics.
[17:30] Speaker 5: Is China is one of the largest China is one
[17:31] Speaker 5: of the largest economies in the world. That's going to
[17:33] Speaker 5: continue to be one of the largest economies.
[17:34] Speaker 4: In the world. You know.
[17:35] Speaker 5: At the moment, I'm very focused on the by ladder
[17:38] Speaker 5: relationship between the US and China. I'm looking forward to
[17:41] Speaker 5: President Trump's visit with President Chief. It's planned for later
[17:44] Speaker 5: this month, the beginning of April. It'll be interesting to
[17:47] Speaker 5: see what comes out of that, and you know, whether
[17:49] Speaker 5: or not China and the US can make more progress,
[17:52] Speaker 5: you know, on their Biladder relationship. I think that's important
[17:55] Speaker 5: for growth in the world, and I think it's important
[17:56] Speaker 5: for both the US and China, and I think at
[17:58] Speaker 5: the moment that's fragile, and I'm very curious to see,
[18:01] Speaker 5: you know, how that progresses. In the meantime, Chinese markets
[18:04] Speaker 5: have done very well in the last twelve months. That's
[18:06] Speaker 5: increased capital flows, you know, into the region. We obviously
[18:10] Speaker 5: participate in that, but we're going to watch those bilateral
[18:13] Speaker 5: meetings and progress in the Biladder relationship very closely.
[18:15] Speaker 1: What would you like to come out in terms of
[18:17] Speaker 1: deliverables from.
[18:19] Speaker 5: I'd like to see, you know, more certainty and clarity
[18:22] Speaker 5: around how the bilateral relationship will work going forward. I
[18:25] Speaker 5: think there are things that the US wants and things
[18:27] Speaker 5: that China wants. I'd like more clarity around what that's
[18:30] Speaker 5: going to look like, you know, not just in twenty
[18:32] Speaker 5: twenty six, but you know, over the coming years. And
[18:34] Speaker 5: I think that's still relatively uncertain.
[18:36] Speaker 4: What are we not talking about enough.
[18:38] Speaker 1: I know we've talked a little bit about private credit.
[18:40] Speaker 1: You don't think it's a sort of a systemic risk
[18:42] Speaker 1: at this point.
[18:45] Speaker 4: I think credit formation.
[18:49] Speaker 5: Around the world is really correlated to you know, economic
[18:53] Speaker 5: growth and economic activity. I do think that we've gone
[18:57] Speaker 5: if I just look at the US market, which is
[18:59] Speaker 5: obviously when you talk about private credit, a very very
[19:02] Speaker 5: large market. The context of private credit, we've gone a
[19:04] Speaker 5: long time without a credit cycle. We've gone a long
[19:07] Speaker 5: time without a recession. I do think when you have
[19:09] Speaker 5: these long dated cycles, they're a variety of things that happen. One,
[19:13] Speaker 5: credit spreads narrow. Two lending standards, people have more capital
[19:18] Speaker 5: deploy they get aggressive, lending standards deteriorate a little bit
[19:21] Speaker 5: due diligent standards deteriorate, and so we're watching very closely
[19:24] Speaker 5: to see if there's been a little bit too much
[19:27] Speaker 5: aggression froftiness in those markets. But fundamentally, when you look
[19:30] Speaker 5: at the underlying credit portfolios, particularly below investment grade credit,
[19:34] Speaker 5: while there have been a bunch of idiosyncratic events where
[19:37] Speaker 5: there have been problems, the broad portfolios are performing reasonably well.
[19:41] Speaker 5: Why are they performing reasonably well because the economy is
[19:44] Speaker 5: doing fine, and it's very hard to have broad underperformance
[19:48] Speaker 5: and a broad diversified credit portfolio. If the economy is
[19:51] Speaker 5: doing well. When we do have a slow down in
[19:53] Speaker 5: the economy, you will see it. I think because of
[19:55] Speaker 5: the length of the cycle, you probably will find places
[19:58] Speaker 5: where the losses are higher than people.
[20:00] Speaker 4: We're very, very focused on.
[20:01] Speaker 5: Back leverage and things that could affect or amplify in
[20:05] Speaker 5: a more difficult economic environment, you know, credit deployment.
[20:09] Speaker 4: But at the moment, when you.
[20:10] Speaker 5: Look broadly across portfolios, we're not seeing things that are
[20:13] Speaker 5: super concerning.
[20:15] Speaker 4: That's a completely.
[20:15] Speaker 5: Different issue than retail participation and retail investors wanting liquidity
[20:21] Speaker 5: from what are fundamentally illiquid products, and so that's getting
[20:24] Speaker 5: a lot of attention, But that's different than the underlying
[20:26] Speaker 5: credit portfolios.
[20:27] Speaker 4: But I do think that.
[20:29] Speaker 5: When there is a slowdown in the economy or we
[20:31] Speaker 5: do get to a place where we have, you know,
[20:33] Speaker 5: a recession, you're going to see losses and credit portfolios,
[20:37] Speaker 5: and you know those losses could be meaningful, but you know,
[20:39] Speaker 5: we'll watch that closely while the economy is jugging along.
[20:42] Speaker 5: You know, that's that's not the primary focus.
[20:44] Speaker 2: That was Goldman Sachs CEO David Solomon speaking with Bloomberg's
[20:47] Speaker 2: Heidi Stroud Watts at the Goldman Sachs Australia Week Alternatives
[20:52] Speaker 2: and Macro Summit, bringing you their conversation here on the
[20:55] Speaker 2: Daybreak Asia podcast. Thanks for listening to today's episodpisode of
[21:00] Speaker 2: the Bloomberg Daybreak Asia Edition podcast. Each weekday, we look
[21:04] Speaker 2: at the story shaping markets, finance, and geopolitics in the
[21:08] Speaker 2: Asia Pacific. You can find us on Apple, Spotify, the
[21:11] Speaker 2: Bloomberg Podcast YouTube channel, or anywhere else you listen. Join
[21:15] Speaker 2: us again tomorrow for insight on the market moves from
[21:18] Speaker 2: Hong Kong to Singapore and Australia. I'm Doug Prisoner and
[21:23] Speaker 2: this is Bloomberg

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