Blackstone President and Chief Operating Officer Jonathan Gray (from left), State Street CEO Ron O’Hanley, Morgan Stanley CEO Ted Peake, Apollo Global Management CEO Mark Rowan LLC and Goldman Sachs Group CEO David Solomon at the Global Financial Leaders Investment Summit in Hong Kong, China, on Tuesday, November 19, 2024.
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Mark Rowan, CEO of Apollo Global Management, told the Global Financial Leaders Investment Summit in Hong Kong that the “industrial renaissance” in the United States is spurring capital demand.
“The need for capital is so great, both through debt and equity… what’s happening is simply extraordinary,” Rowan said during a panel discussion on Tuesday.
The asset manager said the demand is supported by huge government spending, particularly on infrastructure, the semiconductor industry and projects under the Inflation Reduction Act. is reported to be running Treasury secretary position under President-elect Donald Trump.
“What we’re seeing is there’s an incredible demand for capital in the context of huge U.S. government deficits. So I think the financing business is going to be a good business,” he said.
Industrial policy, including the CHIPS and Science Act and the 2021 infrastructure legislation, requires billions of dollars in spending.
Rowan added that the United States has been the largest recipient of foreign direct investment for the past three years and is expected to maintain its number one position this year as well.
Rowan and other panelists also pointed out that the energy and data centers required for artificial intelligence and digitalization are growing industries that require more capital.
Blackstone President and Chief Operating Officer Jonathan Gray told the panel that data centers are the biggest theme across his company. Employ billions of people about their development.
“We’re doing it on an equity basis, we’re doing financing… This is an area that we really like and we’re going to continue to be fully invested in as it relates to digital infrastructure.”
Financing and M&A recovery
Other panellists at the summit organized by the Hong Kong Monetary Authority said financing activity was well positioned to recover from the recent economic slowdown.
Goldman Sachs Chairman and Chief Executive David Solomon said financing activity peaked in 2020 and 2021 amid massive stimulus measures during the COVID-19 pandemic, but later flatlined due to the war in Ukraine, inflationary pressures and the recession. Federal Trade Commission steps up regulation.
Solomon said trading activity has picked up recently as conditions normalize and in anticipation of friendlier trading regulations from the Federal Trade Commission under the incoming Donald Trump administration.
Morgan Stanley Chief Executive Ted Peake said that while there remains an inflationary backdrop and other risks in the current environment, consumers and businesses are “generally in good shape” as the economy continues to grow.
“If you’re in the business of allocating capital, this is a great environment,” he said, adding that the group was now preparing to enter “capital-raising mode.”
“It’s a sign of a growing and prosperous economy and where traditional underwriting and M&A businesses dominate,” he said.
Salomon predicts these trends will make financing and M&A activity “even stronger” in 2025.
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