BlackRock CEO Larry Fink has stated that he is seeing signs that inflation may ease out. However, he did admit that the same is not reflected in the data. Speaking at the Institute of International Finance conference in Washington, Fink stated,
“I just started to see more threads of declining inflation, but they’re not in the numbers yet.”
Fink claimed that efforts to combat inflation may eventually have an adverse impact on pricing pressures. This is due to variables including a rapid expansion of new supply chains, which were severely impacted by the COVID-19 epidemic. However, Fink noted that falling prices for stocks and bonds offer chances for investors, adding that his company is observing a “really big interest in bonds.”
Fink added,
“Other people’s grief is somebody else’s opportunity.”
BlackRock facing the wrath of Republicans?
Fink has publicly come out in defense of the world’s largest asset manager after the firm faced backlash for its environmental, social, and governance (ESG) stance. The company has come under fire in the debate on low-carbon fuels. Additionally, environmentalists argue that the firm has not done enough to change its fossil fuel portfolio companies.
Fink stated,
“Facts are not important with some sub-groups in this country. […] I’m now being attacked equally by the left and the right so I’m doing something right, I hope. I don’t know. It’s painful, but you know what? We’re moving forward.”
With $8 trillion in assets under its management, BlackRock is currently awaiting government approval to fund US energy pipelines. Being one of the biggest pipeline financiers in the world, BlackRock is currently investing in pipelines in Texas, Saudi Arabia, and the United Arab Emirates. However, at the same time US states of Texas, Arkansas, and West Virginia have targeted BlackRock’s ESG investment strategies.
In protest of the firm’s ESG stance, several Republican states began withdrawing state funds from BlackRock. In recent weeks, Louisiana, South Carolina, Utah, and Arkansas all declared they would withdraw more than $1 billion from the asset manager.
Louisiana has already eliminated $560 million and will have taken out a total of $794 million by the end of the year. While South Carolina plans to divest $200 million from BlackRock management. Moreover, Utah already has withdrawn $100 million, and Arkansas has withdrawn $125 million.