BlackRock CEO Larry Fink Says Further 20% Market Drop Is Possible

Fink, who spoke at the The Economic Club of New York on Monday, said that he still sees the current drawdown as a “buying opportunity.”

• BlackRock CEO Larry Fink warned of a possible additional 20% market drop but views the current downturn as a long-term buying opportunity, citing no systemic risk.
• He cautioned that inflation remains higher than expected and said the Federal Reserve is unlikely to cut interest rates this year despite recession concerns.
• Fink also expressed concern over bitcoin’s rising appeal, suggesting it could undermine the U.S. dollar if seen as a safer store of value.

During a recent talk at The Economic Club of New York, BlackRock CEO Larry Fink stirred concerns by suggesting the market might witness a further 20% decline. However, he balanced this caution with an optimistic perspective, deeming the current market situation as an opportunity for long-term investment rather than a cause for alarm due to the absence of systemic risks.

Fink highlighted that prevailing inflation rates are surpassing expectations and voiced skepticism about the Federal Reserve's potential interest rate cuts in light of looming recession fears. Moreover, he expressed unease regarding the growing allure of bitcoin, hinting at its possible impact on the stability of the U.S. dollar if it gains traction as a more secure asset.

He noted that inflationary pressure is higher than market participants expect and that many already believe the U.S. to be in a recession. As a result, he does not anticipate the Federal Reserve to cut interest rates this year.