Bank CEOs say the global economy is doing phenomenally well — Quartz

Davos, Switzerland

“It’s a time of enormous ebullience,” said Blackstone CEO Steve Schwarzman on a panel in Davos today (Jan. 23), “part of which has been created by really good economic growth.”

Schwarzman’s optimism was shared by other finance chiefs in the first hours of the World Economic Forum’s annual meeting.

“I think we are in an exceptionally favorable context,” said Credit Suisse CEO Tidjane Thiam, speaking during the panel on global markets. “There’s synchronous growth, with the US doing well, China doing well, Europe doing well.”

“You have a very constructive economic backdrop,” said Brian Moynihan, Bank of America’s CEO. He said the bank’s US consumer customers are spending $125 billion more now than they were a year earlier, helping drive global growth.

The bank CEOs said geopolitical uncertainties, such as an escalation of conflict with North Korea, are the biggest risks to the stock market run, which has seen the Standard & Poor’s 500 index rise over 20% in the past 12 months. The risks are “not the normal things that people talk about at Davos, which are economic issues,” said Schwarzman. “The world is in a good place economically, about as good as it could be.”

Indeed, the IMF on Jan. 22 upgraded its forecast for global GDP and said tax cuts will boost the US economy (which will be felt around the world) for the next few years. “I’ve learned over time never to bet against the US economy,” said Thiam.

If one believed the Davos consensus was a contrary indicator, and wanted to bet against it, the bankers’ comments offer a clear sign that it’s time to move into cash.