Business
BlackRock is anticipated to report impressive earnings, as Larry Fink's company pivots away from its previous focus on socially conscious investments.
2025-03-31 17:26:48
In case you missed it, BlackRock — indeed, that BlackRock — is shifting away from its progressive stance. Furthermore, it’s not facing any financial troubles, as On The Money has discovered.
On Wednesday, just before the market opens, the largest money management firm in the world is set to announce its earnings for the fourth quarter as well as its financial results for the entire year.
According to my contacts on Wall Street, both are expected to illustrate that their operations are operating at maximum capacity.
Confluence doesn’t necessarily equate concurrence, of course. But it’s remarkably obvious that at a time when BlackRock has dialed back its overt progressive posturing — leaving, as the Post reported last week, a UN-sponsored group of environmental activists — its financial performance is soaring, at least according to the Wall Street buzz.
One significant factor is that the backlash from conservative critics regarding its so-called ESG investing has diminished as the organization has distanced itself from being a fervent proponent of the woke investing approach.
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Larry Fink's BlackRock has exited a UN-backed coalition of environmental advocates, coinciding with the company's remarkable performance surge.
Additional Insights from Charles Gasparino
Treasurers in Red States continue to view BlackRock's CEO Larry Fink with a degree of skepticism, though that sentiment has softened recently. They have mostly ceased their harsh criticisms of him as a proponent of "woke" ideology. Additionally, many have refrained from withdrawing funds from the firm now that he has toned down his embrace of progressive initiatives.
By shifting its emphasis away from political matters and concentrating more on business, BlackRock is experiencing significant growth. Its assets under management are projected to exceed $11.5 trillion, despite the fact that recent increases in interest rates may negatively impact its fixed income investments.
Analysts believe that the company's earnings will remain robust despite the increasing interest rates, thanks to its diversified operations. While major asset managers are grappling with client pressure regarding fees and experiencing withdrawals, BlackRock managed to attract a significant influx of capital last year from various channels, including pension funds and individual investors, according to sources.
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The backlash from conservative critics regarding its alleged ESG investing has diminished as it has distanced itself from being a strong proponent of the progressive investment approach.
BlackRock is making significant strides in the cryptocurrency space. If you examine the rankings of the largest Bitcoin holders, you'll find that in a relatively brief timeframe, BlackRock — representing traditional finance — has positioned itself just below the legendary Satoshi Nakamoto and the prominent crypto exchange Binance.
As of January, it possesses approximately 560,000 bitcoins valued at roughly $55 billion, making it the leading player in the Bitcoin market due to its highly sought-after Bitcoin ETF. According to sources, the inflows into the ETF have remained consistent, as will be highlighted in the upcoming earnings report.
BlackRock chose not to provide a statement for this report due to its inability to offer pre-earnings forward guidance. However, my sources maintain that Fink is poised for a well-deserved triumph.
Yes, I know, Fink says a lot of stuff — some of which has gotten him in trouble in his advocacy of Environmental Social Governance investing. The investment style, his critics alleged, channeled progressive politics on issues like energy conservation through the investment process.
In recent years, he earned the ire of the both Red State GOP-run pension funds, and Republicans in Congress even as he won plaudits from the political left for using BlackRock’s investment might to enact social change. But with the growth of Red State populations and their pension funds, Fink’s ESG posturing was costly; assets declined around $1 trillion in 2022.
I have a deeper understanding of Fink than his detractors do, and the portrayal of him as merely an admirer of Elizabeth Warren is completely inaccurate.
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Fink often shares a variety of opinions, some of which have led to controversy in his support for Environmental Social Governance (ESG) investing.
Fink founded BlackRock three decades ago with no assets, and he didn't grow it to over $11.5 trillion through leftist ideologies. He is recognized as one of the top risk managers on Wall Street, a reputation earned through years of bond trading and valuable lessons learned from his setbacks, unlike many of his peers. This expertise is a key reason why, at 72 years old, he continues to thrive as CEO.
I have indicated that he took significant risks regarding ESG due to financial motivations. He successfully secured a substantial amount of left-leaning pension investments in New York and California. However, as early as 2021, he recognized potential issues and began advocating for a shift towards sustainability, warning that without it, there would be a decline in oil drilling and an increase in inflation.
Since then, he has been distancing himself from ESG, diminishing its focus in the management of non-ESG assets. As I revealed earlier, he abandoned a crucial UN-supported asset management organization last week that was committed to achieving net-zero carbon emissions by 2050.
Here’s a fascinating tidbit: In conservative political circles, detractors of Fink often refer to him as “Mr. ESG.” Meanwhile, a fresh wave of younger investors has dubbed him “Mr. Bitcoin,” even though he previously labeled the cryptocurrency as an “indicator of money laundering.”
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Fink founded BlackRock three decades ago with no assets, and he didn't grow it to over $11.5 trillion through leftist ideologies.
He acknowledged his error and introduced the Bitcoin ETF nearly a year ago in January 2024. Since then, it has risen by almost 125%.
When you rise on Wednesday, I’ve heard that BlackRock will be showcasing its impressive performance. I'm sure Fink will be celebrating on financial television.
He ought to, as it's no accident that when he and the company became less aware of social issues, they distanced themselves significantly from financial struggles.
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