BlackRock Chairman on '1 Quadrillion Operation': "No Fed Solution... Inflation Will Persist for Years"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Hyunjung] Larry Fink, Chairman and CEO of BlackRock, the world's largest asset management company, said that inflation will continue for the next several years due to global supply chain disruptions.

In an interview with Bloomberg Television's "The Close" on the 2nd, Fink explained, "The situation worsened due to COVID-19 and lockdowns in various parts of the world," adding, "Supply is driving the problem more."

As of the end of the first quarter this year, BlackRock manages approximately $9.6 trillion (about 1,192.32 trillion KRW) and is facing adverse factors such as rising prices, interest rate hikes, and geopolitical upheavals. He emphasized, "The war in Ukraine has brought significant changes to the global economy, and companies and governments must spend more to reconsider their dependence on overseas markets and strengthen local capabilities."

Fink stated, "We will see a hair-trigger situation that could cause more market turmoil," but also explained, "However, we do not observe changes in investors' asset allocations." He also noted, "The Federal Reserve (Fed) does not have the tools to solve supply issues across the economy," and predicted, "Market volatility will continue." He added, "As the economy transitions to eco-friendly energy sources, inflationary pressures will persist."

He also showed discomfort regarding calls for the financial sector, including asset management firms, to participate in addressing the climate crisis. He said, "BlackRock does not support normative shareholder resolutions on climate policy," and added, "Asset managers are not responsible for verifying whether companies in their portfolios are protecting the planet." Furthermore, he criticized, "I have no intention of becoming an environmental police officer," and stated, "It is wrong to demand such a role from the private sector."

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