Some of America’s top financial services executives are beginning to issue economic warnings.
They say they are seeing signs of “softing” or “weaking,” and many CEOs have weighed ahead of next week’s Federal Reserve decision, and the Bureau of Labor Statistics is falling this week.
In an interview with CNBC on Wednesday, Goldman Sachs CEO David Solomon said the economy is “still moving” while the signal may be heading in a different direction.
“There are a number of CEOs talking about softening the economy. There’s no question,” he said. “I’ve seen some job data that shows it’s getting softer.”
In a preliminary report released Tuesday, BLS revised its non-farm salary data for the year before March 2025, showing a significant drop of 911,000 from the initial estimate. The revision is more than 50% higher than last year, and is the biggest change in over 20 years, adding to growing concerns about the economy.
The BLS also fired the director in early August and fired fire from President Donald Trump, who criticized the way data was collected.
Solomon believes that inflation today has “more jobs” and that tariffs are affecting growth, but it is difficult to quantify at this stage. As the economy is heading into the fall, Solomon said he expects a slight change in policy rates, including 25 point cuts by the Fed next week.
Trump has also been critical of the central bank and slammed Fed Chairman Jerome Powell for lower interest rates. The Federal Open Market Committee last cut benchmark interest rates in December 2024 and has since been stable within the target range of 4.25% to 4.5%.
JPMorgan Chase CEO Jamie Dimon told CNBC on Tuesday that the Fed “is likely to have a “lower interest rate” at the ‘coming’ meeting, but he believes it will not affect the economy.
Dimon said he believes the BLS report confirms that the US economy is slowing.
“I think the economy is weakening,” Dimon told CNBC’s Leslie Picker in an interview. “I don’t know whether it’s heading into a recession or just weakening.”
But ultimately, Dimon said that given consumers are weakened, they’ll just “wait and see” how the economy progresses.
Similarly, Wells Fargo CEO Charles Scharf said on Wednesday that he sees low-income Americans struggling to float despite the large companies doing well.
“There’s this big dichotomy between high-income and low-income consumers, and it continues and is a real problem,” Scharf said.
Commenting on BLS figures, Scharf said it was “undeniable” that there was a contradiction between American taxpayers and that it was looking at “more negative aspects” for the US economy.
Job creation in August also showed signs of weakness as BLS reported last week that non-farm payroll had risen just 22,000 for the month.
Morgan Stanley CEO Ted Pick told CNBC he believes that the American CEO or CFO must be resilient through recent ups and downs, including Covid and the two Trump administrations.
“We’re in a place where we think some of the policy uncertainty is actually beginning to be quantified,” he said.
Still, Pick says he saw a headwind and believes that policy uncertainty may be slightly narrowed.
“So yes, there might be a bit of a slowdown,” Pick said.
Barclays CEO CS Venkatakrishnan said on CNBC on Tuesday that he believes the Fed will cut margins due to the softness of the labor market.
Traders also expect the Fed to see lower prices. They are now betting that the Fed will cut at least a quarter point, according to the CME FedWatch tool based on Fed futures trading, with some stakes that there will be an even deeper cut of 50 basis points or half points.
Even if the issue of inflation does not yet clearly present itself, Venkatakrishnan said the current economy shows CEOs should look at it in the long term.
“We haven’t seen them yet, but we have to worry about them,” he said.
Bill Demchak, CEO of PNC Financial Services, also joined Wave, informing CNBC on Tuesday that there is “basic pressure on the economy” between employment workers, labor shortages and wage pressures.
Demchak said he sees evidence in support of the revised BLS report, and believes that consumer spending is the reason the Fed will be cutting rates in the future, despite “driven the economy.”
“There’s pressure in our economy that I won’t go away just because at some point the tariffs might reach behind us,” Demchuk said.
