Interview, Fireside Chat
John Waldron on GDP Growth, AI, and the M&A Outlook
- Maintains general optimism while increasing caution at the margin regarding inflation, geopolitical tensions (including Iran), and interest rates compared to six to 12 months prior.
- Anticipates higher persistent costs of capital and doing business due to inflation, alongside a forecast for U.S. nominal growth exceeding 6% and real growth between 2.5% and potentially 3%.
- Projects inflation to migrate downward, with growth expectations diverging by region: very strong in Asia driven by Chinese innovation and exports, versus muted performance in Europe amid political turbulence, energy insecurity, and excess Chinese supply.
- Forecasts corporate M&A activity to increase 30% to 35% this year to record levels, driven by strong backlogs and pipelines, reflecting CEO confidence and a continued bias toward larger scale entities attracting superior capital.
- Identifies massive capital requirements for AI infrastructure, development, and decarbonization, positioning the private sector as a primary engine for capital formation as governments remain levered.
- Expects significant opportunities in asset and wealth management over the next five to 10 years as wealth creation continues.
- Plans to deploy digital agents and AI tools to automate processes, achieve record growth in AI capabilities by 2027, and combine human judgment with technology for clients.
- Intends to continue acquiring companies to fill gaps in solutions, asset classes, and distribution, while establishing systematic playbooks for integration to enhance firm sharpness.
- Prioritizes preserving culture as a human capital organization while onboarding young talent with intellectual curiosity, noting that technology will amplify their ability to absorb information.