BlackRock, the world’s largest money manager, has more than $11 trillion in assets under management. Today, it is laying the groundwork to dramatically grow its footprint in private credit and other alternative investments. Last year just was the years BlackRock’s biggest arcane in the market. They purchased HPS Investment Partners for $12 billion in stock and Global Infrastructure Partners for $12.5 billion. These acquisitions further illustrate BlackRock’s strategy to invest further into private credit and infrastructure. As BlackRock CEO Larry Fink noted in a …
Larry Fink, a prominent figure in the financial industry, has recently expressed concerns about the resurgence of protectionist policies globally. He fears that these policies would severely disrupt global trade and consequently weaken the American economy. In his annual chairman’s letter to investors, which is widely read and closely monitored, Fink addressed the economic anxieties felt by many.
“The divide has reshaped our politics, our policies, even our sense of what’s possible. Protectionism has returned with force.” – Larry Fink
Private markets are most conducive today as mentioned in infrastructure boom and private credit. He mentioned that with the fiscal situation of many governments limited by soaring deficits, they would turn more frequently to private investors to pay for public infrastructure.
“Governments can’t fund infrastructure through deficits. The deficits can’t get much higher. Instead, they’ll turn to private investors,” – Larry Fink
Fink underlined the change that businesses are trying to make. Their sharp shift from bank lending to alternative, market-based credit solutions has been driven by traditional bank lending constraints.
“Meanwhile, companies won’t rely solely on banks for credit. Bank lending is constrained. Instead, businesses will go to the markets.” – Larry Fink
All of BlackRock’s recent purchases fit with its larger strategy to position itself for this changing world of finance. Still, BlackRock is being visionary in expanding into private credit and alternative investments. This strategy has established the company as a leader in these fast-growing markets. Such an expansion would be in keeping with Fink’s stated plan to chart a course through the thicket of the modern economy.