goldman sachs CEO David Solomon said Tuesday that investors are decisively moving into “greed” mode as the market prepares to test an unprecedented wave of funding for giant artificial intelligence companies.
CNBC’s Leslie Picker was asked whether the market could support OpenAI’s upcoming initial public offering of large shares. human and space xSolomon said there is plenty of capital available for the deal.
“If the world remains optimistic, there is plenty of liquidity in the system,” Solomon said. “We are definitely in a time where there is more greed than fear.”
Solomon’s comments come as investors prepare for one of the busiest periods of equity issuance in years. SpaceX, which includes two major providers of AI models and Elon Musk’s AI company, could go public at valuations in the trillions of dollars just as other companies seek huge sums to fund data centers, chips and infrastructure, raising questions about whether the market will be able to absorb the supply.
Mr. Solomon’s bank plays a key role in some transactions, but he downplayed those concerns. of the alphabet He said the recent stock performance after announcing an $80 billion equity raising plan proves the market is still receptive to AI.
“The stock price has been doing very well,” Solomon said. “This is the first real, concrete data point of something of this magnitude, which is encouraging.”
He said that while the market is accepting, strong stock and bond markets are encouraging companies to raise capital.
“When capital is available, you should spend it, and when it is available, you should take capital,” Solomon said.
Mr Solomon acknowledged the unprecedented scale of the funding wave, but argued record levels of wealth and liquidity across the market were supporting the activity. He also said the profits generated by AI companies could create a self-reinforcing cycle as employees and investors recycle profits into taxes and new ventures.
Greed “can quickly turn into fear, but it doesn’t always happen,” Solomon said. “The frenzy can last for a long time. … There’s a good chance it’s earlier in the cycle than later.”
