October 9th, 2013
01:15 PM ET

Goldman Sachs chief: Adverse consequences are already being felt

Fareed spoke recently with Lloyd Blankfein, CEO and chairman of Goldman Sachs, about the stalemate in Washington. Watch the full interview on "Fareed Zakaria GPS," this Sunday at 10 a.m. and 1 p.m. ET

What do you think the economic impact of what is happening in the Senate, the position of the House Republicans is, on markets and people’s understanding of the American economy?

Well, I say the confrontation and the way that confrontation is being carried out is, I think, a very bad impact on the markets and it's totally foreseeable.

Wherever you stand on the content, on the specific issues of what's trying to be accomplished, the idea of engaging away from the substantive argument after it's already been decided, and saying, you know, something will blow up the credit rating unless you accede to us, is just a poor policy and, I think, a poor demonstration. And, I think, a poor example of the American political process.

Are you actually worried that we will default?

I think it's very unlikely, because in this situation, sensibility normally prevails. But it's not an on-off switch. We’re already making people insecure. The markets are already responding. And some of the adverse consequences are already being felt. And it will continue to reverberate even if there's an acquiescence.

So it's already bad. If we actually went into a position of default…that would be very, very negative. But we're already getting some negative aspects at the moment.

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Topics: Economy • GPS Show

soundoff (13 Responses)
  1. ✠RZ✠

    Compiling a current list of the 25 most serious problems facing America today should highlight just how insanely stupid and insignificant this fight for the top bunk is between Boehmer and Obama. And the "adverse consequences" being felt by the shutdown will likely prove microscopic in comparison to what may lie ahead.

    October 9, 2013 at 8:02 pm |
  2. John Smith

    America is the root of all terror. America has invaded sixty countries since world war 2.
    In 1953 America overthrow Iran's democratic government Mohammad Mosaddegh and installed a brutal dictator Shah. America helped Shah of Iran to establish secret police and killed thousands of Iranian people.
    During Iran-Iraq war evil America supported Suddam Hossain and killed millions of Iranian people. In 1989, America, is the only country ever, shot down Iran's civilian air plane, killing 290 people.
    In 2003,America invaded Iraq and killed 1,000,000+ innocent Iraqi people and 4,000,000+ Iraqi people were displaced.
    Now America is a failed state with huge debt. Its debt will be 22 trillion by 2015.

    October 9, 2013 at 8:14 pm |
    • ✠RZ✠

      Given all the existing animal species on this planet, none are more brutal and blood thirsty than humankind. Yet we are no physical match for the likes of lions, tigers, and bears just to name a few, nor comparatively speaking anywhere near the strength and ruggedness of a lowly ant. Clearly, it is our own minds and the experience, belief, and knowledge therein that must be reckoned with. Although greed and money have more recently received much notoriety, and rightfully so, historically and to this very day, it is both religion and education that can be held accountable for more atrocities, death, and bloodshed than is imaginable. And so therein lies the "root of all terror", and evil, and fear, and unimaginable devastation. And until these potential horrors are first dealt with accordingly and somehow made agreeable to all, there can be no peace amongst all the living on Earth. One can only wonder what difference might have come by dropping trillions of dollars in internet connections and iPads on other countries, rather than bombs and guns.

      October 11, 2013 at 7:42 am |
  3. Stephanie

    If the U.S. defaults on its debt – it is not – because a handful of Republican legislators don’t like a law vetted by all branches of government, the damage will go beyond a much lower credit rating. Something else – a sense that the U.S. is, for all its differences, united – will have been lost – unfortunately because Washington DC does not understand that China is not allowed to finance USA. NATO is going to finance USA – and nobody else.

    October 10, 2013 at 5:15 am |
  4. j. von hettlingen

    They GOP have a poor understanding of the word "debt ceiling". They thought raising it would also mean to increase debts. It's sad that a bunch of sullen, irresponsible people can't behave like educated grownups and sort things out in a civilised manner.

    October 10, 2013 at 9:34 am |
  5. rightospeak

    Too much nonsense ,too much propaganda , too much censorship for the truth to come out. Unless that changes, we are sitting ducks.

    October 10, 2013 at 12:24 pm |
  6. rightospeak

    He is not worried about default because he will not let it happen and he runs the show with Federal reserve, a private bank.
    Unless they are kicked out of running the US not much will change. They own the media as well and use censorship to manipulate the public opinion.

    October 11, 2013 at 1:16 pm |
  7. Karl Marx

    Lloyd Blankfein, walking proof someone didn't have enough ovens.

    October 12, 2013 at 4:45 am |
  8. Anne

    Too bad this isn't showing the entire interview. This guy is brilliant! While Fareed did his usual political one way directing, Lloyd gave an excellent explanation of why the two houses are really battering out their differences at the moment. Comparing the first 2 years of Obama's presidency to the acts of a Parliament. Having all one political party running the show put our entire process on a such an uneven slope that we are now feeling the backlash of the other party who demands to be heard but doesn't have the power to balance on their own. The entire interview was very impressive....and I personally appreciated how Lloyd is not a yes man to Fareed's agendas.

    October 16, 2013 at 10:15 am |
  9. Anne

    Of course GPS is only showing the part of the interview (out of context) to a point that follows Fareed's views. Should have shown the entire interview to give the public an opportunity to judge for themselves.

    October 16, 2013 at 10:16 am |
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