Blackrock is an institution that garners a ton of attention. It also elicits a great deal of emotion.
This is one of those entities that many people feel are too big to fail. With the behemoths, it is hard to envision their demise.
Of course, history is littered with companies that took a massive hit.
There are a number of things that will cause the downfall of Blackrock.
Blackrock Is Not Too Big To Fail
This is a company that peaked. It might be hard to believe. However, they are being exposed for making decisions leading it down the path of massive failure.
To start, Larry Fink is in tight with Klaus Schwab and the WEF. He is a big time supporter of globalization and the elitist view of the world.
Unfortunately, for them, it always ends the same.
Schwab is an academic who knows nothing of markets, business, or what makes the economy goes. Like many in his position, the view is they can control it all.
Fink, most likely driven by greed, is following him down the path to destruction. There are many things which will doom Blackrock.
We are seeing some cracks in the veneer.
ESG Costing Them Business
Larry Fink was forced to admit that the company's foray into ESG is costing them business. This was done in a filing with the SEC.
"BlackRock’s business, scale and investments subject it to significant media coverage and increasing attention from a broad range of stakeholders," the filing submitted late last month said. "This heightened scrutiny has resulted in negative publicity and adverse actions for BlackRock and may continue to do so in the future."
It continued, "Any perceived or actual action or lack thereof, or perceived lack of transparency, by BlackRock on matters subject to scrutiny, such as ESG, may be viewed differently by various stakeholders and adversely impact BlackRock’s reputation and business, including through redemptions or terminations by clients, and legal and governmental action and scrutiny."
The problem for Blackrock is they are being looked into by Congress. At risk is whether the firms’ promotion of environmental, social, and governance (ESG) goals to determine if it violated antitrust laws. BlackRock and others have barred businesses that did not adhere to ESG standards, denying them professional opportunities and overseeing that any company wishing to be affiliated with BlackRock adhere to ESG standards.
If this is proven to be the case and there was material harm, this is bad news for Blackrock. The first is the government could apply penalties. Second, and more importantly, they could be open to lawsuit by different firms that were financially harmed.
The latter can get real expensive since companies can sue for up to 3 times the amount of damage they suffered.
There is also the prospect of facing felony charges.
Ukraine
Blackrock is one of the entities that is vying to get into Ukraine.
There are a number of moves that are in play. The idea is, not surprisingly, to get things on the cheap and cash in when the economy returns.
We can think of this as the ultimate in distress properties.
The problem is the presumption of the West that it will win. The Neocons in Washington have no interest in peace, rebuilding, or Ukraine. The intent is World War 3 and the destruction of Russia.
While war appears to be inevitable, the destruction of Russia is not likely on the agenda. We were told by the media how weak Russia was. As they say, the first casualty of war is the truth. Propaganda takes over.
Investment in Ukraine is going to be a loser. Remember, nothing has panned out as the Neocons claimed in any conflict since World War 2.
Liquidity Crunch
The final piece is the lack of liquidity.
Blackrock has somewhere around $10 trillion in assets under management. This is an eye-popping amount. The problem is that, if confidence wanes, there is no way to liquidate assets.
When you have that much in assets, there is no market that can absorb it. What this means is that the company will have to withhold the selling until the market can absorb it.
Unfortunately, they cannot put this stuff off forever.
This is going to be difficult as some of the covert investments in Ukraine start to go belly up. When customers start asking for their funds back, it will be like a bank run.
Notice how, in spite of the stock market reaching all time highs, Blackrock peaked in late 2021. It is still significantly below its all time highs.
This is a company that has some major issues. Blackrock has customer funds that it is responsible for returning. If a run does start, it could really turn negative rapidly.