Davos round-up: Goldman’s consumer banking headache, Big Tech layoffs and Germany’s green drive
As some of the world’s most important CEOs, politicians and thinkers gather at the World Economic Forum in Davos to discuss an array of economic, political and social challenges, Morning Wire wraps up some of the top lines from the day.
Goldman Sachs’ consumer banking headache
Goldman Sachs’ foray into consumer banking has not gone as planned, contributing to a worse than expected earnings report yesterday.
In an interview with CNBC at Davos today, CEO David Solomon admitted the bank had tried to do “too much, too quickly” on consumer banking.
Solomon attempted to remain optimistic however, stressing that Goldman “did some things right”.
“We now have a very good deposits business” he said, and the bank’s partnership with Apple is “an interesting opportunity to experiment and try different things”.
Investors may look at Goldman’s recent record when it comes to experimentation and conclude it’s better to stick to what it knows best.
Big tech layoffs
Big tech has faced a reckoning in 2022.
After years of seemingly limitless growth, tech giants are scaling back their ambitions and making huge job cuts.
Today Microsoft employees became the latest soon-to-be casualties in the ongoing round of layoffs at Big Tech firms, as it announced it would eliminate 10,000 jobs.
“We will have to do more with less,” Satya Nadella, Microsoft’s CEO, said at Davos today. “We will have to show our own productivity gains with our own technology.”
Germany’s green drive
German Chancellor Olaf Scholz was the only leader of a G7 country to make the trip to Davos, but he came with glad tidings.
In a keynote speech, Scholz said that Germany’s transition to “a climate-neutral economy” was taking on “an entirely new dynamic”.
These changes, he said, came “not in spite of, but because of the Russian war and the resulting pressure on us Europeans to change.”
“Germany can be flexible; we can be unbureaucratic; and we can be fast,” Scholz said.
Looking forward, Scholz said that when his successor addresses Davos in 2045, “he or she will present Germany as one of the world’s first climate-neutral industrial nations.”