President of Blackstone Jonathan Gray speaking on economic crises of the 2020s at the Milken Institute Global Conference: “The U.S. economy and global economy powered through. The markets powered through. And my expectation is that will continue.”PATRICK T. FALLON/AFP/Getty Images
Some of the world’s most influential investment executives are looking past the economic fallout from war in Iran, betting that waves of investment in artificial intelligence and infrastructure will help economies push through a period of global turmoil.
The Milken Institute Global Conference, a sprawling gathering of top CEOs held annually in Beverly Hills, started off on an optimistic note on Monday. The opening sessions showed that animal spirits are alive and well with investors, even as gasoline and grocery prices put mounting pressure on businesses and household budgets.
The U.S. economy, in particular, has been “powering through,” Blackstone BX-N president Jonathan Gray said on a panel discussion on Monday.
Company revenue is growing and “we continue to see a pretty good picture on inflation, away from oil prices,” he said. At the same time, technology giants are spending “enormous” sums to build out artificial intelligence infrastructure, which promises a big step up in productivity.
“If you think back to the start of 2020 with COVID, then a couple years later, we had Russia-Ukraine, we had [the collapse of] Silicon Valley Bank. We had Liberation Day [tariffs] last year. Now we have this war,” Mr. Gray said.
“Through each of those crises, the people in this room, all of us would have said, ‘Oh, I’m nervous. What’s going to happen?’ And yet the U.S. economy and global economy powered through. The markets powered through. And my expectation is that will continue.”
Even Gulf investors who have experienced the war up close are doing their best to keep their eyes on the long-term horizon.
“The last eight weeks have been difficult,” even “life-changing,” said Waleed Al Mokarrab Al Muhairi, deputy group CEO of Mubadala Investment Co., a state-owned US$385-billion investment fund in the United Arab Emirates.
But there is a common theme when “talking to every CEO, every chairman, every minister, every leader in Abu Dhabi and the UAE: Everybody’s looking for opportunity,” he added. “We’re looking past all the stuff that brought us down, and we’re looking at ways to do what we do best.”
Still, he seemed briefly taken aback by the collective willingness to frame the war, which has dragged into its third month and nearly doubled the price of a barrel of oil, as a temporary hiccup. The panel’s moderator, CNBC anchor David Faber, asked about the “externalities” that the war has created.
“I don’t think anybody’s called them externalities, at least not to my face,” Mr. Al Muhairi said, drawing laughter from the audience.
Waleed Al Mokarrab Al Muhairi, deputy group CEO of Mubadala Investment Co., speaks during the Milken Institute Global Conference in Beverly Hills, Calif., on May 4, 2025.PATRICK T. FALLON/AFP/Getty Images
A number of CEOs also were also sanguine about the private credit market, which has been shaken by a surge of investor requests to withdraw money, forcing some of the largest funds to limit redemptions.
The Carlyle Group CEO Harvey Schwartz, Morgan Stanley co-president Daniel Simkowitz and State Street chairman and CEO Ron O’Hanley all agreed that any issues in private credit lending portfolios do note pose a systemic threat to the financial system.
Whereas in the global financial crisis of 2008, risk was highly concentrated in the banking system, “private credit is exactly the opposite. It’s a distributor of risk,” Mr. O’Hanley said.
Mr. Al Muhairi said that “private credit is still interesting” because it is fulfilling a market need for capital.
The real estate sector, which has been “out of favour for four years” among investors, “is going to start to get a real look” as supply of properties dries up and interest rates settle at more normal levels, Mr. Gray said.
Infrastructure, especially digital and energy assets, “will have its heyday as well” in the coming years, Mr. Al Muhairi said.
The only question the CEOs had a harder time answering was what really worries them.
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Mr. O’Hanley said data centre development could be “a little overdone.” Mr. Schwartz said high deficits that governments around the world are running mean public investment is constrained.
There was concern about the jobs that AI could disrupt, and the effect that would have on consumer demand.
Mr. Gray said there should be “a huge boom in blue-collar employment, certainly over the next five years,” but “there won’t be probably the same growth in white-collar head count over time.”
Mr. Schwartz said he buys the argument that AI will boost productivity, but doesn’t expect it will lead to “massive unemployment.”
But the CEO of the California Public Employees’ Retirement System (CalPERS), which manages US$621-billion for 2.3 million members in the state, was blunt about the potential risk to workers.
“Innovation can be very helpful, but I do have pretty grave concerns about disruption of people,” she said.