11 episodes

In each episode of “Top of Mind at Goldman Sachs,” Allison Nathan, a senior strategist in the firm’s Global Investment Research division and the creator and editor of the GS “Top of Mind” publication, explores macroeconomic issues that are on the minds of Goldman Sachs clients.

Top of Mind at Goldman Sachs Goldman Sachs

    • Business

In each episode of “Top of Mind at Goldman Sachs,” Allison Nathan, a senior strategist in the firm’s Global Investment Research division and the creator and editor of the GS “Top of Mind” publication, explores macroeconomic issues that are on the minds of Goldman Sachs clients.

    Roaring Into Recession

    Roaring Into Recession

    Coronavirus has pushed the global economy into a recession of historic proportions and halted the longest-lasting equity bull market on record. As infections spread globally, economic activity collapses, markets recoil and policymakers respond, the depth and duration of the economic and market downturn is Top of Mind.
    In this episode, Allison Nathan speaks with the former Chair of the Council of Economic Advisers, Jason Furman, and Goldman Sachs’ Chief Economist, Jan Hatzius. Both agree that the near-term economic damage will be severe, but whether it proves longer-lasting will depend largely on the virus’ trajectory and somewhat on policymakers, who have done a lot, but may need to do more to sustain households, businesses and market functioning in this difficult period. To that end, we assess the risk that the global health crisis becomes a financial crisis. And we discuss how this might play out in markets, and what investors should do from here. For that, we draw on the wisdom of Oaktree Co-Chairman, Howard Marks. His advice? Buy things with solid fundamentals when they go on sale.

    • 23 min
    2020’s Black Swan: Coronavirus

    2020’s Black Swan: Coronavirus

    Amid many concerns heading into 2020, the event that no one expected was the outbreak of COVID-19—a coronavirus that first emerged in the populous city of Wuhan, China, and which is now proving to be both more infectious and virulent than the common flu. As China attempts to restart its economy after an unprecedented lockdown, the virus continues to spread globally, and data on the sizeable economic fallout starts to trickle in, coronavirus is Top of Mind. We feature expert interviews with Harvard’s Dr. Barry Bloom and University of Minnesota’s Dr. Michael Osterholm to better understand what we know—and don’t know—about the virus today. We also interview Goldman Sachs’ Chief Economist Jan Hatzius about the economic impact of the outbreak—both on global growth and actions of central banks around the world.

    • 24 min
    Investing In Climate Change

    Investing In Climate Change

    In this episode, we dig into what may be the most important issue of our time: climate change. On the heels of a climate-focused World Economic Forum in Davos, the unveiling of Europe’s new Green Deal, and increased attention on climate change by the world’s largest asset managers and banks, climate change is undoubtedly Top of Mind.
    We speak with Michael Greenstone of the University of Chicago, Nathaniel Keohane of the Environmental Defense Fund and Goldman Sachs’ Steve Strongin about the climate challenge, and what it will take to address it. We also discuss how capital markets and climate policy are driving transformational shifts in the energy industry, and what it means for sector returns. Finally, the head of the Goldman Sachs Sustainable Finance Group, John Goldstein, provides insight and advice on ESG investing and integration, and the growing implications of shareholders and clients increasingly demanding more accountability on climate.

    • 20 min
    Fiscal Focus

    Fiscal Focus

    With monetary policy, conducted by central banks, nearly exhausted in the major economies and low interest rates globally, whether fiscal policy, conducted by governments, should play a greater role from here is Top of Mind. In this episode, Goldman Sachs Research’s Allison Nathan interviews former IMF Chief Economist, Olivier Blanchard, Harvard professor, Alberto Alesina, and Goldman Sachs’ Chief Economist, Jan Hatzius. They discuss whether increased fiscal stimulus today would do more good than harm, and, even if it would, whether the economies that need it the most will pursue it. Our key takeaways: Germany should embrace a large fiscal expansion, but likely won’t; investors should expect some more fiscal stimulus in China, but only enough to avoid a sharp slowdown.

    Audio of former European Central Bank President Mario Draghi is courtesy of the European Central Bank YouTube channel via the Creative Commons Attribution license https://www.youtube.com/watch?v=TjIaLD4I8go).

    • 21 min
    Growth and Geopolitical Risk

    Growth and Geopolitical Risk

    The market has once again been gripped by recession fears at the same time that geopolitical and policy risk is flaring up. Some of these risks—like the US-China trade war—are feeding recessionary fears, while others—like the attack on Saudi oil facilities that led to the largest ever daily disruption in oil supplies—have gone almost unnoticed. And this is despite the fact that oil shocks were one of the most common causes of recession historically. Whether this complacency is warranted, and the vulnerability of the economy and markets to this and other geopolitical shocks, is Top of Mind. In this episode, Goldman Sachs’ Head of Energy Research Damien Courvalin explains why the oil market is much better positioned to deal with supply outages today, and thus is a less likely recession trigger than in the past. But the Council on Foreign Relations’ President, Richard Haass, and Columbia Professor Richard Nephew explain why instability looks set to rise in the Middle East and beyond. 

    • 19 min
    Currency Wars

    Currency Wars

    President Trump has voiced concern that a strong Dollar is damaging US competitiveness. Of course, exchange rates do matter for trade, and the US' non-oil trade balance has deteriorated sharply since the Dollar began to climb in 2014. So it’s no surprise that Trump’s laser focus on the US trade deficit would end up targeting Dollar strength—and that currency would become another front in the US-China trade war. Whether the US should, could, and would begin to proactively manage the Dollar, and whether these actions—or further trade war escalation—could lead to a global “currency war” is Top of Mind.  
    In this episode, Goldman Sachs Research’s Allison Nathan gets perspectives from the Peterson Institute’s Joseph Gagnon and the Council on Foreign Relations’ Brad Setser; both believe that Dollar strength and the associated US trade deficit are cause for concern, but see low odds of US foreign exchange intervention that triggers a currency war (Goldman Sachs analysts agree). But given that China has been managing the Yuan stronger than it otherwise would be, trade war escalation that motivates a sharp Yuan depreciation could be such a trigger.

    • 22 min

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