MINNEAPOLIS (WCCO) — Only a year after Richard Davis took the helm at U.S. Bank, the nation’s economic fabric was being ripped apart.
The great downturn in the nation’s economy was largely created by a collapse in the housing industry, casting the country into the worst economic funk since the great depression.
“Banks and other institutions allowed people to get in over their heads,” Davis said.
America, Davis said, was over-leveraged, but the colossal collapse also brought badly needed change.
“I know banks have learned their lessons, and even if we hadn’t, the regulation has done a remarkable job of creating guardrails,” he said. “They’re much tighter now.”
Now, the 58-year old U.S. Bancorp CEO is about to retire, handing the reins of the nation’s fifth largest bank to his COO, Andy Cecere. But before he does, Davis brought his optimistic outlook to the Economic Club’s luncheon in downtown Minneapolis on Wednesday.
Davis made reference to things on the near horizon driving the economy and called robotics and artificial intelligence a “game changer.” He told the crowd the looming industry has the potential to bring about our nation’s fourth economic revolution.
“We’ve been looking for the next revolution for a long time,” he said. “This could be it.”
The improving economy is now driven by rising wages, low unemployment and President Trump’s promise to remove what markets hate most — uncertainty.
“But if the two biggest things were going to be health care and taxes, whether he does any of it, he’s taken the uncertainty out,” Davis said. “He says he’s going to fix health care and lower taxes.”
Still, Davis said many concerns linger, particularly as Washington leaders chart a new course on trade, China and in the face of rising inflation.
On the topic of the controversial Dakota Access Pipeline, which has seen bank headquarters targeted by pipeline protesters, Davis doesn’t see the protests diminishing soon.
“The President’s decision to move forward probably emboldens those who don’t want it,” he said. “If they can’t get to the President they will likely see more pressure on the 34 banks.”
The last time Davis addressed the group was June of 2010 and the Dow Jones index was at 10,000. On Wednesday, it topped the 20,000 barrier. Davis joked with the crowd that perhaps he should come back and address them in seven more years.