Blackstone (BX) Goldman Sachs 2024 U.S. Financial Services Conference summary

Economic and market outlook for 2025

• Economic momentum is strong, especially in the U.S., with low recession expectations among CEOs and robust revenue growth in portfolio companies.

• Inflation is moderating, with wage growth below 4% and rental housing costs lagging government CPI data, supporting a gradual path for Fed rate cuts.

• Debt spreads have tightened, base rates have come down, and equity capital markets are strong, aided by technological innovation and AI-driven investment booms.

• Deployment of capital accelerated ahead of anticipated market normalization, benefiting from a pullback in the cost of capital.

Impact of political and regulatory changes

• A Trump administration is expected to favor lower corporate taxes, traditional antitrust approaches, and increased support for hydrocarbons.

• Uncertainty remains around trade policy, with higher tariffs likely but specifics unclear; overall, the environment is seen as positive for business.

Capital deployment and investment themes

• Capital deployment reached $92 billion year-to-date, double the prior year's pace, with continued strong activity expected as markets normalize.

• Key focus areas include digital infrastructure (notably data centers), energy and power, commercial real estate recovery, private credit, and franchise businesses.

• Secondary transactions are increasing as buyer-seller price expectations converge.