Market Analysis - Goldman Sachs strategists suggest the correlation between the US dollar and CBOE's Volatility Index is more significant than its correlation with US stock levels [1]

Thank you so much, John, and thank you, Kim, for doing this today. Um, obviously AI is front and center in everybody's mind, and you're really at the center of this ecosystem from a venture and IPO standpoint, from an M&A standpoint, from a debt financing standpoint. Based on that 360 view, do you get the sense that AI is in a bubble right now.>> So, great to see you, Leslie. Thanks for having me. Um, so the AI bubble question, that's the multi- trillion dollar question.Um I think that um AI will be absolut ...

Core Viewpoint - The recent release of Epstein files has implicated executives from various industries, including finance, raising concerns about potential fallout for companies like Goldman Sachs due to their general counsel's correspondence with Epstein [1][2]. Regulatory Environment - Fed Governor Michael Bar expressed concerns that the rollback of bank supervision could weaken the Federal Reserve's supervisory role, potentially leading to risks in the banking system [3]. - A memo from Mary Aken, director of supervision, outlined a new regulatory framework focused on significant risk issues rather than excessive documentation processes that do not impact safety and soundness [4]. - The current regulatory changes are seen as beneficial for the economy and bank lending, as they aim to streamline processes and focus on essential risk management [5][6].

Core Viewpoint - The innovative economy is currently a focal point for markets, with expectations of potential market corrections in the next year or two due to historical patterns following technological accelerations [2][4]. Group 1: Market Dynamics - There is ongoing volatility in the markets, and while some froth may have been removed, remnants could still exist [3][4]. - The pace of technology adoption is anticipated to be slower than the market currently expects, leading to fluctuations in investment returns over the coming years [6][7]. - Concerns exist regarding the ability of companies to meet debt obligations tied to new technologies, particularly if the pace of adoption does not align with expectations [8][9]. Group 2: Private Credit and Financing - Private credit is a significant area of financing for data center buildouts, with recent scrutiny over the valuations and performance of private credit managers [18][19]. - Goldman Sachs operates across the spectrum of private credit, lending to below-investment-grade companies that generally perform well in a strong economy [22][24]. - The credit risks associated with financing data centers differ from those of other private credit ventures, as data centers are often backed by large, stable companies like Google and Amazon [24][25]. Group 3: Long-term Economic Outlook - The long-term economic benefits from AI and technology deployment are expected to be substantial, contributing to productivity gains and overall economic growth [12][13][16]. - While short-term volatility is acknowledged, the overarching trend towards technological advancement is viewed as a secular trend that will not reverse [12][14]. - The importance of disciplined risk management and underwriting processes in credit markets is emphasized, particularly in the context of potential economic downturns [26][27].

AI Technology & Market - The speaker expresses excitement about AI technology and the investments being made to deploy it in enterprises, anticipating significant productivity gains [4] - The market is currently optimistic about AI, potentially underestimating risks and overestimating the speed of adoption; adjustments and volatility are expected [5] - Despite potential short-term volatility, the long-term secular trend of AI is expected to bring extraordinary economic benefits and productivity gains [13][15] - Some AI-related assets may be overvalued, with earnings not meeting current expectations, which is typical in acceleration cycles [18] Capital & Financing - Hyperscalers are investing more of their substantial cash flow into AI projects and are considered financially strong [9] - Data center financing is viewed as real estate deals, with debt serviced by the output of the data centers, and the creditors are typically large, stable companies [10][11] - Private capital formation in new AI companies involves higher risk, with potential for both significant successes and failures [11][12] - Private credit is a large business, and it's important to differentiate between lending to established companies and financing data centers [21][25] - Underwriting standards and risk management are crucial in credit, and economic contractions will reveal the strengths and weaknesses of different lenders [26][27]

Core Insights - Goldman Sachs is poised for a historic year in mergers and acquisitions (M&A), potentially rivaling activity levels not seen since the early 2000s, as deal-making accelerates [1][4] - The firm has secured approximately 34% of the $3.8 trillion in global M&A announced this year, reflecting a 28% increase from the previous year [2] M&A Deal Value - Goldman Sachs leads Wall Street in M&A deal value with $592.04 billion, marking a 36% increase compared to the previous period [3] - Other top banks include Morgan Stanley at $465.80 billion and JP Morgan at $449.84 billion, with respective increases of 24% [3] Advisory Fees - Goldman Sachs also tops the advisory fees chart with $1.81 billion, a 10% increase from the previous period [7] - The total advisory fees for the top 10 banks decreased by 2%, while Goldman’s fees rose significantly, indicating strong market positioning [7] Year-to-Date Performance - Year to date, Goldman has advised on nearly $1.1 trillion in M&A volume, securing the top position in both deal value and advisory fees [6] - In the first nine months of 2025, Goldman’s M&A advisory fees rose 31% year over year to $3.37 billion, contributing to a 19% increase in overall investment banking fees [8] Regional Strength - Goldman advised on $369 billion in deals, leading the North America region by value in the first nine months of 2025, and also topped Europe with $17.6 billion in transactions [10] Macroeconomic Environment - Favorable macroeconomic conditions, including stabilizing interest rates and clearer regulatory frameworks, have reduced execution risks for cross-border and mega-deals, encouraging M&A activity [11] - Expectations for supportive policies under the current administration are boosting confidence in executing larger strategic deals [11] Future Outlook - Goldman’s management anticipates continued strength in M&A activity through the end of 2025, with even stronger activity expected in 2026 [12] - The firm is well-positioned for ongoing success, supported by a high investment banking backlog and leading advisory league tables [14]

Core Viewpoint - Gold is experiencing a temporary dip, with analysts believing it is a short-term correction rather than the start of a prolonged downturn [1][2] Price Performance - Gold surged nearly 75% year-to-date in 2025, reaching an all-time high of US$4,336 per ounce on October 30, before slipping about 6% to around US$4,062 [1] Factors Behind the Pullback - The strengthening US dollar is a major factor, making gold more expensive for international buyers and dampening demand [2] - Goldman Sachs expects gold to climb to US$4,900 by the end of 2026, representing a gain of roughly 21% from current levels [2] Investor Sentiment - Analyst Lina Thomas sees potential for further upside if private investors diversify into gold alongside traditional portfolios [3] - UBS strategists forecast gold could reach US$5,000 by 2026 or 2027, reinforcing the view that the current pullback is a buying opportunity [3] Interest Rates and Demand - The outlook for US interest rates has shifted, with the likelihood of a rate cut in December falling below 50%, making Treasuries more attractive compared to gold [4] - Goldman remains bullish due to strong demand from central banks and private investors [4] Central Bank Activity - Central banks have been accumulating gold since 2022 to reduce reliance on dollar-denominated assets, a trend that accelerated after US sanctions on Russia [5] - Buying activity from central banks even increased in September [5] ETF Investments - Over US$41 billion has flowed into gold-backed ETFs like SPDR Gold Shares (GLD) this year [5] - Despite modest outflows of about US$1.2 billion in recent weeks, Goldman expects ETF investors and ultra-high-net-worth individuals to continue accumulating physical gold [6]

Investment Strategy & Outlook - Goldman Sachs Asset Management suggests diversifying portfolios and looking outside the US for better returns, recommending a "get down, get client, and get active" approach in equities [1][2] - The firm is constructive on small caps both in the US and outside the US [2] - Real estate, particularly on the debt side, is starting to look appealing [8] Small Cap Opportunities - Small cap growth strategies can capture more upside, offering an alternative to low volatility strategies [4] - Intra-stock and inter-stock correlations in the small cap sector are at multi-year lows (5-10%), presenting alpha opportunities [5] - Small cap exposure is viewed favorably as many investors are avoiding it [7] Emerging Markets & India - Broad emerging markets have outperformed the US this year, but single-country performance varies [9] - Goldman Sachs analysts have moved from underweight to overweight on India [9] - While broad EM is up 20-30% year-to-date, India is only up about 3% [9] - India's valuation has retraced from a 25 times multiple to a 23 times multiple, and its premium versus other EM has decreased from the '9s to closer to 4-5 [11] - Government and policy reforms, including tax cuts and bank deregulation, make India an interesting place to look for investment [12]

Core Viewpoint - Tradeweb Markets Inc. will present at the Goldman Sachs 2025 U.S. Financial Services Conference, highlighting its role as a leading operator in electronic marketplaces for various financial instruments [1] Company Information - Tradeweb Markets Inc. is a global operator of electronic marketplaces focused on rates, credit, equities, and money markets [1] - The CEO, Billy Hult, is scheduled to participate in a fireside chat on December 10, 2025, at 10:40 AM EST [1] Event Details - A live webcast of the session will be available for investors [1] - A replay of the session will also be provided [1]

Gig Economy Attracting More Workers As Layoffs Increase, Goldman Sachs Report Sayshttps://t.co/SvBEWAhAHL https://t.co/CsluEtMQGS ...