Goldman Sachs CEO David Solomon advises his clients to be more careful with their finances because the actions of the Federal Reserve to fight inflation could lead to a recession or other negative consequences.

Higher interest rates and reversals in the Fed’s bond buying programs will have an impact on a number of things in your business that are hard to predict, ”Solomon told Andrew Ross Ross Sorkin of CNBC on Wednesday.

“You have to think that at some point there is a reasonable chance that we have a recession or we have, you know, very, very slow, sluggish growth,” Solomon said. “If you run a significant business, you have to look through the prism a little more carefully than you could have been when we were sitting here a year ago.”

The combination of rising commodity prices, protracted supply chain problems and tightening monetary policy by the Fed has damaged the confidence of corporate executives, according to a business poll released on Wednesday. While most respondents expect a recession, Goldman economists tie the odds to about 30% over the next 12-24 months.

Shares of Target fell on Wednesday after it became known that rising labor costs and delivery, as well as declining sales of discretionary goods affected earnings.

This year, the Fed has doubled its base interest rate and said it would cut its balance sheet by tens of billions of dollars a month, “a journey in the process of tightening economic conditions,” Solomon said.

This change, a sharp reversal of the last decade’s easy wage policy, has shocked investors and caught some companies by surprise as they try to raise capital, he said.

“There are a number of companies that thought they would get easy access to capital, but now it will probably be harder to raise the necessary capital,” Solomon said.

During an extensive interview, Solomon also discussed topics, including crypto and fintechnology, saying he was a “real bull” in digital finance failures, before his investment bank’s new vacation policy. The bank gives partners and managing directors more flexibility to take time away from work because “historically our people have not taken the leave to which they are entitled,” Solomon said.

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