With nearly $10 trillion in assets under management (AUM), BlackRock is the world’s largest asset manager.
The company exploded in size after the 2008 financial crisis, and that’s no coincidence.
Central banks around the world have printed scores of trillions since then. A significant portion of that freshly created money eventually found its way into the stock market, specifically BlackRock’s exchange-traded funds (ETFs).
BlackRock was also responsible for helping the Federal Reserve manage its massive debt portfolio after 2008. It’s another indication of BlackRock’s cozy relationship with the government.
BlackRock is a good illustration of the Cantillon Effect—those closest to the money printing benefiting.
BlackRock mystifies and amazes me. It came from ground zero in the late ’80s, started by Larry Fink and a few of his friends. How did they manage to garner $10 trillion and become the biggest financial management entity in the world? Are they super competent, or just super well wired with the Fed? They’re certainly competent at garnering funds. They’re absolutely “connected.” In today’s world, where governments directly and indirectly control everything, rest assured that the top guys in BlackRock are charter members of the Deep State.
As money managers, they’ve essentially put themselves in a position to collect a royalty of 10, 20, or 30 basis points—and sometimes 1%—on the assets under management. It has to be one of the best businesses in the world because BlackRock has only something like 1,800 employees to manage $10 trillion.
BlackRock does more than collect royalties for providing a service. The problem is that the ETFs, mutual funds, and pensions it controls, vote the stock of public companies. That means they can install the directors they like, who then move the companies in the directions they like.
BlackRock’s ETFs own large positions in many publicly-traded companies.
BlackRock uses this to promote an agenda that might not align with the retail investors who own shares in BlackRock ETFs.
CEO Larry Fink once dubiously claimed that “no issue ranks higher than climate change on our clients’ lists of priorities.”
The Fed’s money printing has helped to pump up BlackRock’s AUM, which the company uses to advance a political agenda.
BlackRock is a perfect example of why money printing and central banking always cause the rich to get richer. Not only do they stand closer to the money spigot, but they’re well-connected to do favors for government officials. And the favors are returned. As excess money is created, lots of it flows into the stock and bond markets. But the average guy doesn’t know what stocks to buy, so he relies on these money managers.
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