From Yahoo Finance: 2025-05-05 16:11:00

Wall Street leaders and dealmakers at the Milken Institute Global Conference in Beverly Hills discussed economic slowdown fears due to Trump’s trade policies. Despite uncertainty, they remain cautiously optimistic about the U.S. economy. Many believe Trump’s tariffs have caused companies to pause investments and increased risks but hope for a softer stance.

Economists warned of a high risk of global recession due to Trump’s tariffs damaging business sentiment. Attendees at the conference believe a softer stance on tariffs could lessen the economic slump. Treasury Secretary Bessent stated Trump’s policies would solidify the U.S.’ position as the “home of global capital.” Investors remain cautious amid trade war uncertainty.

Investors are preparing for potential headwinds and holding off on investment spending due to trade policy uncertainty. Delays in mergers and acquisitions have slowed demand for private capital. Some see the market’s wild gyrations as an opportunity, while others believe the recession talk is overblown. Investors with high risk tolerance may find opportunities in the slowdown.

The lack of clarity over tariffs and their economic impact has pushed large firms to delay capital expenditure decisions. This creates opportunities for smaller players in the middle market. Common themes like a renewed push toward industrialization are emerging. Western economies are revitalizing industry, which bodes well for infrastructure as a defensive asset.

Top bank chiefs and hedge fund managers mingled at the conference, emphasizing America’s attractiveness for investment. Despite uncertainties, many remain committed to deploying capital in the U.S. Mubadala Investment Company, with 42% of its portfolios invested in the U.S., continues to assess opportunities and deploy capital.

Read more: Tariff fears loom large at Milken as executives try to stay calm