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The risk of a U.S. recession could rise suddenly depending on how the administration reacts to the Iran war on social media,Goldman Sachs Group Inc.chief executive David Solomon said.
A larger or smaller risk of an economic downturn could be “only one tweet away,” Solomon said in an interview at the Paley Center for Media in Manhattan, adding that current forecasts for a recession remain fairly low.
The remark points to a broader reality in financial markets, which have whipsawed on social media posts by PresidentDonald Trump, who often communicates via his Truth Social platform. Last week, he posted about Iran agreeing to never close the Strait of Hormuz — a declaration that hadn’t been confirmed by Iran — which sent the stock market rallying and oil prices falling.
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“Anyone watching the interview knows David was obviously making a joke,” Goldman Sachs spokesperson Tony Fratto said by phone.
Goldman’s economists are forecasting chances of a recession this year at about 20 per cent, only slightly higher than the 15 per cent that’s their base case in a “benign environment.”
Source: Drudge Report
