Since the outbreak of the COVID-19 pandemic, global debt has reached a historic high, reaching around $300 trillion by 2022. As central banks around the world raise interest rates to cope with persistent inflationary pressures, debt risks are becoming increasingly severe.
On June 28, the second day of the 14th World Economic Forum Annual Meeting of the New Champions, participants conducted in-depth discussions on macroeconomic issues such as global debt under high interest rates and debt risks.
In an interview with National Business Daily (NBD), Robert McCooey, vice chairman at Nasdaq, said that the US government has been able to push the debt sailing out until January of 2025 now, but longer term solutions are necessary, "I think that we're hopefully looking forward to finding them in the United States."
Robert McCooey Photo/Su Yuting (NBD)
Markets always a key part of solution
NBD: You just mentioned the silicon valley bank crisis. What is the role that Nasdaq plays in mitigating the impact of such crisis?
McCooey: We don't actually play a direct role in solving a crisis like that with the regional banks in Silicon Valley Bank crisis.
What we do is we make sure that there is opportunity for investors to buy or sell each moment of each trading day. So we want to make sure that we encourage the liquidity that's in the market, that if investors want to buy Silicon Valley Bank or any other bank that they can come to our market and to be able to do transactions in that market all during the trading day.
NBD: What do you think of the role of the government in debt ceiling?
McCooey: The government has to play an important role in any kind of debt ceiling change or negotiation, but it needs to be bilateral. It needs to be both parties coming together to an honest discussions about it, and also making sure that it's not short term that we have some more longer term solutions for any kind of debt issues that arise in the United States.
They have been able to push the debt sailing out until January of 2025 now, but I think longer term solutions are necessary, and I think that we're hopefully looking forward to finding them in the United States.
NBD: What's the role of financial institutions in solving debt problems?
McCooey: The markets are always gonna be a key part of the solution, and whether they're the banks or other market participants, they will be important parts of any kind of solution that's found in the US. Not only in terms of the US debt in general, but more importantly, in finding the growth that we need in order to pay back that debt.
So we need to get back to growth cycle in the us, we're doing a number of things, but the government level, and hopefully at the corporate level to bring that back. And the more we can achieve that, the better we will be from a financial standpoint, especially in terms of dealing with our debt.
Companies including fin-tech, EV continues to have great opportunities
NBD: Which industries do you think will have more opportunities in the current US stock market?
McCooey: The companies that can continue to have great opportunity in the market are technology, fin-tech, health care, EV and energy transition type of companies. We're excited to support those companies.
NBD: ChatGPT became popular, and AI fund managers appeared in the United States. What do you think of that?
McCooey: Everyone (human fund managers) is using data analysis, and then you need a human layer on top of the data analysis in order to make the final investment decisions.
I'm sure there are some funds that are using pure AI but I think in general, we want to make sure that there is a balance between that and some human being making the investment decision. I think most investment managers are still doing that.
NBD: How do you feel attending this year's forum?
McCooey: I think that this meeting is focused on entrepreneurship. Nasdaq is the home for entrepreneurs, the home for entrepreneurship.
We've got the greatest entrepreneurs in the world that have ever come to market who have ever changed the world with their products and services that are listed on Nasdaq. So this is the perfect place for us to be.
There are fantastic entrepreneurs in China, and we look forward to continuing to engage with them. And at the right time, some of them might choose to list on Nasdaq and we look forward to welcoming them.