BlackRock’s Fink: 2019 a ‘distant reality’

BlackRock’s Fink: 2019 a ‘distant reality’

  • BlackRock's Fink wrote in his annual letter to shareholders 2019 is a "distant memory."
  • The coronavirus has "overtaken our lives" in nearly every single way.
  • The world will recover but will certainly "be different."

2019 was a monumental year for global money manager BlackRock but this seems to be a “distant reality,” Chairman and CEO Larry Fink wrote in his yearly letter to shareholders.

‘Overtaken our lives’

The coronavirus has, unfortunately, “overtaken our lives” and BlackRock’s offices across the world are void of human activity, Fink wrote. Instead, he is writing his annual letter to shareholders from his home office, much like millions of others.

The sad reality is the coronavirus has forced the world to seek shelter in their homes “on a scale never before seen.” Small business owners are feeling the impact the hardest from a financial perspective. Doctors and other professionals on the front line are the most impacted emotionally as they are in many cases the sole deciding factor on who gets to live another day and who doesn’t.

Fink, a 44-year veteran of the industry, noted the virus is also challenging business practices which were deemed to be vital to the global economy, namely an “infatuation” with just-in-time supply chains. Perhaps “more profoundly,” people will re-examine the way they work, shop, travel, and even gather. 

‘The world will be different’

Once the global community overcomes the coronavirus, “the world will be different,” he wrote. Investor psychology won’t be the same, the way we do business will change, consumption will change. However, the economy will recover, in part due to the quick action by central banks to introduce stimulus measures.

For the time being at least, it is impossible to know just when the crisis will be resolved. In fact, it is still not known if the stock market can retest prior lows and the current rally is a dead cat bounce.

‘Tremendous opportunities’

BlackRock is a long-term thinker in both the way it operates as a company and seeks investments. It is clear that the long-term picture remains attractive to investors, and savvy individuals can take advantage of “tremendous opportunities” in today’s markets. 

Companies that offer a clear and strong “sense of purpose” and a focus on solving long-term challenges will be in a better position to navigate through the current uncertainty and thrive in the aftermath.

In the meantime, it is important for everyone to keep in mind the virus can hit anyone and everyone. As such, we all have a shared interest to work on tackling this outbreak together. Now is not the time to let partisan politics get in the way of a solution.

By Jayson Derrick
Jayson Derrick has been writing professionally about stocks since 2011. He is particularly interested in alternative investments, hedge funds, and activist investing. He is a big fan of NHL hockey and lives in Montreal, Canada with his wife and four year old daughter.

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