Wall Street and the banks are back, but investors should be careful about sky-high expectations of regulatory rollbacks, Goldman Sachs Chief Strategy Officer Stephen Scherr said Tuesday.
Scherr, who also serves as CEO of Goldman Sachs Bank USA, said on CNBC's "Fast Money" that the tone of Tuesday's Goldman Sachs Financial Services Conference was upbeat and optimistic, relative to the last several years. However, the executives in attendance were cautious in terms of how much deregulation the banks would see from the Trump administration.
"We need to be a bit guarded in terms of just how much change we'll see and the pace of that change," Scherr said. "But it's very clear the market has a high expectation of what regulatory change may bring."
Investors and banks are optimistic about the direction that the economy will take, he said. He described an expectation held by the market for the banks to see a positive turn.
Regarding the number of Goldman executives who have recently left the company, and the possibility that COO Gary Cohn may leave in the near future for a Trump Cabinet position, Scherr said that leadership changes at the top of the firm would present opportunities for others to step up. He emphasized that Goldman has a "deep bench" and was confident that the firm would carry on.