Blankfein: Trump's Trade Threats Are A Savvy "Negotiating Strategy"

With roughly six months left before he leaves the Goldman Sachs C-Suite, CEO Lloyd Blankfein has been sounding more uninhibited in interviews lately. In one recent conversation, the CEO admitted that "it's only with great trepidation that I'd say anything positive about the president".

But he changed his tone in an interview with Bloomberg News Editor-in-Chief John Micklethwait published Tuesday, where the longtime investment banking executive finally found something positive to say about President Trump.

As Blankfein argued, Trump's tariff threats "make sense" as a bargaining strategy and probably won't precipitate a devastating trade war or the attendant economic collapse that on Tuesday clinched the Dow's longest losing streak in 15 months.

"That’s what you’d do if it was a negotiating position and you wanted to remind your negotiating counterparty of how much firepower you have," Blankfein said Tuesday in an interview at the Economic Club of New York.

"I don’t think we’re in a suicide pact on this, so I suspect we’re not going to cause the economies to collapse."

Instead, Blankfein speculated that Trump's aggressive trade war threats (the president most recently threatened to expand tariffs to $200 billion of Chinese good) are part of a broader "negotiating strategy."

"I do think -- as some people have commented - that this is part of a negotiating pattern, that would be my best take," Blankfein said.

Asked about his relationship with the Trump administration, Blankfein shared details about a recent trip to China that Goldman was invited to participate in. Blankfein tagged along in an effort to help close an "important transaction." While he couldn't provide too many details, he explained that the venture - a partnership with China's sovereign wealth fund - was meant to raise money for a fund that would invest in US companies that export goods to China.

Blankfein

The deal was "an important symbol of what China wanted to do for US trade," Blankfein said.

"There's a lot of frustration with China from here...I know that China is unhappy with the sudden aggressiveness of US policy...but anybody who has transacted with China appreciates the potential of China and has good experiences with China and frustrating experiences in China.

We ourselves stop be quite honest 15 years ago almost set up our joint venture in China that seemed imminent at the time...and in fact there were statements that said it's already available...and when it gets to the ministries that have to affect these things..we learned that [the bank] has to be capitalized at a level that would be totally...not sensible for us to do - and so we're back at square one."

Following the trade discussion, the conversation turned to the controversy du jour - President Trump's "zero tolerance policy" that has led to migrant children being separated from their parents and detained at the border. Blankfein said the images of crying children were "heart-rendering."

"Watching now is heart-rending and I wouldn’t be on that side, but thank God I’m not there - It’s never right against wrong, good against evil," said Blankfein, who noted how immigration debates have roiled Europe.

"Now what do you want to do? Both sides are right."

It has been nearly two months since Blankfein tweeted, but yesterday, as we detailed here, Yahoo Finance published an interview that the outgoing Goldman CEO conducted with Paul Tudor Jones.

During the interview, Blankfein goaded Jones into offering a pessimistic view of asset prices that mirrored the long-term bearish views of Albert Edwards, perhaps Wall Street's best-known permabear, and also Blankfein's increasingly anxious outlook on markets and the mismanagement of the world's largest central banks.

Comments

dirty fingernails bshirley1968 Tue, 06/19/2018 - 20:24 Permalink

Yep. Of course the Trumptards will perform another feat of mental contortions and double-think and approve of Blankfiend because he said something nice about Trump. Nevermind the mountain of evidence that Lloyd is human excrement. Nevermind the thousands of posts saying how corrupt and evil he is. "OMG, he praised Trump. All is forgiven. Here is my account information, Lloyd. God bless."

In reply to by bshirley1968

vato poco dirty fingernails Tue, 06/19/2018 - 22:09 Permalink

do any of you stupid fucks - the ones who aren't bots or $7/hr Soroscorp Key Employees - do any of you even remember how fucked up this country got during O'Chimpy's terms? how freakin' close it came to the whole country being DONE? how everyone with any form of a functioning brain - which leaves most of you out - understood if the cunt won, that Civil War 2.0 would begin within 6 months?

do you get just how far and how fast Trump has moved us all back from the brink?

no, of course you don't. you just like to/get paid to whine about how 'Trump hasn't rolled back 100% of the incredibly well-entrenched 150-year-old Deep State yet! goldman! jooooz! we only have 5% GDP growth, not 6%! waaaaah!'

so fuck ya

In reply to by dirty fingernails

dirty fingernails vato poco Tue, 06/19/2018 - 23:03 Permalink

Do you even remember how fucked up tbis country was under W? It ain't improving snowflake. The new coat of orange paint and Hate Tweets are only hastening the demise.

 

LMAO @ your civil war fantasy. The consitution is long dead and where are the patriots? Where were all you "lawful citizens," who suddenly became oh so righteous when a black Dem was in office, during the lawless W administration? Oh, right cheering for the storm troopers and calling protestors of illegal wars traitors.

Fuck off. There is no saving this ship with Trump or Clinton or any "acceptable" cannidate's policies no matter how much you downvote me.

ROFLMAO @ your GDP BS. The *only* reason GDP is "up" is because of the spending spree. Period. Add in all the fake ass numbers and we are still negative. Learn to like eating your lawn, douche nozzle. Trump won't give a shit how your life goes. He never cared before he ran and he sure as fuck didn't suddenly grow a conscience or morals.

In reply to by vato poco

Adolfsteinbergovitch p4424119 Tue, 06/19/2018 - 23:38 Permalink

So you finally fixed your typos but you still aren't professional enough to look into the details of your fake ad. I guess it all comes up to the level of intellect that is required to do the job which I do not wish to discuss, for I just had lunch. 

$24551 @85/h gives roughly 290 hours of porno work per month. Man if that's not milking people like cows then what is this? 

Are you one of these Jewish porn moguls? 

In reply to by p4424119

SILVERGEDDON silverer Tue, 06/19/2018 - 20:12 Permalink

Lloyd the puppet master. 

Trump, the mouth piece. 

Ahh, the scam becomes perfectly clear now. 

Money and power run the country.

All the rest of us can go fuck themselves. 

Anndddd - Trump is still a better pick than Cankles ever was.

Fucking sad state of affairs. 

Time for some new rules in politics.
 

No money, no lobbying, no campaign unless you pay it out of pocket.

No income over 100k a year for any politician, no free benefits, and no pension beyond Social Security.

No crime or malfeasance while holding public office, or you get shot, pissed on, and buried in a landfill.

No more 2 party bullshit - representatives by the people, for the people, of the people only. 

That may be the only lasting legacy the puppet masters cannot take away from Trump - we don't need no steeennnking political hack parties. 

Oh yeah - intern all current politicians, alphabet agency overlords, and departmental bureaucrats in FEMA camps. 

Let's get a clean start on governance with integrity and consequences, please. 

 

In reply to by silverer

DingleBarryObummer dirty fingernails Tue, 06/19/2018 - 20:24 Permalink

Yea, but if we are going to go off the waterfall anyways, might as well paddle to it faster and get it over with.  Maybe some of us will survive, or maybe even be better off afterwards.

That's what I see the tariffs as: accelerating off the cliff.  Blankfein will disappear somewhere with beaches and drinks in coconut shells after this is over.  He's just does what he is told as well.

In reply to by dirty fingernails

dirty fingernails DingleBarryObummer Tue, 06/19/2018 - 20:49 Permalink

Oh, we are going over the cliff. There is no MAGA at the bottom either. It doesn't matter what we want or say, the dotard's ego is in the driver's seat. I'm against his methods because I think it would be possible to take the coming fall in scripted steps rather than uncontrolled chaos. I'd rather we were spending our time preparing for hard times instead of pretending some new golden age was around the corner. Fuck Trump's entire foreign policy. Fuck his domestic policy. I do think he's doing as good a job as any with immigration. Seriously, there are no good ideas beyond troops on the border. Other than that it's a collapsing empire clusterfuck.

In reply to by DingleBarryObummer

bshirley1968 new game Tue, 06/19/2018 - 20:24 Permalink

That you ask that question reveals you are a "low information constituent".

GS, after ripping billions off from investors and other banks, took the government handout money, and then told the DOJ to go f themselves and their investigation.

This guy has more stroke than any 5 combined senators. Hell, GS probably owns 25 senators, the treasury secretary and his assistant, the federal reserve, the ECB, and the bank of England.

So, yes, what he says matters....to a lot of banking, corporate, political, and media bitches that work for him.

In reply to by new game

hongdo Tue, 06/19/2018 - 20:03 Permalink

The squid is right this time.  Trump is establishing the initial common ground for negotiations.  If he did not do this the initial common ground starting point for negotiations would be the status quo which is favorable to the other side.  And then he would be placed in the position of negotiating something away in order to get anything.   

If the other side is not a little bit afraid you might be crazy, you have lost.

Nov1917Sucks hongdo Tue, 06/19/2018 - 20:46 Permalink

So he got elected, he drove up the price of oil by 50% to get out of personal debt, he destroyed the DXY by 10% to get out of personal debt and he opened up 4 million acres of public land to miners and oil corps to get out of personal debt. He is negotiating alright, and his dumber than rocks Christian Jihadist voters are going to be using their bibles for heat this winter!

In reply to by hongdo