Why Larry Fink's Take on the Fed Is Spot-On (Connecting the Dots:Jerome Powell, The Federal Reserve, The Carlyle Group, The Economic Club of Washington, BlackRock, The U.S. Secret Service & Soros Funding, All Networking)
Newsmax.com
By
Nigel GreenThursday, 31 October 2024 08:26 AM
BlackRock
CEO Larry Fink made
waves this week with his outlook on interest rates, challenging the
increasingly popular notion that the Federal Reserve will soon cut rates significantly.
Fink
said Tuesday he believes that “embedded” inflation will keep the Fed from
aggressively slashing rates, even as market pressures build. And here’s why I
think he’s exactly right.
Many
investors are overlooking a key point: inflation today isn’t the temporary
phenomenon we hoped it might be. It’s become structural, with roots that go
deep into the economy.
Fink’s
view hinges on this very point — economic forces like labor shortages,
deglobalization, and energy sector shifts are woven into the fabric of current
inflation.
These pressures won’t dissipate with a rate cut, nor are they likely to recede
without serious recalibration across industries. Understanding this is crucial
to taking a bullish stance, one that acknowledges the Fed’s restrained approach
as a positive for sustained economic health and robust investment
opportunities.
There’s
no denying the persistence of labor market pressures, for one. The labor market
has proven remarkably resilient, even under the weight of high-interest rates,
and signs point to it staying that way. Companies, especially those in
essential sectors, are still struggling to fill roles and are now paying more
to attract the talent they need.
Wage
growth might have tapered from the breakneck pace seen in 2021, but it’s still
running at rates that keep inflation firmly embedded. This isn’t a fleeting
trend. Demographic shifts and labor shortages are driving up costs in ways that
aren’t easily reversible, and it’s fueling a sustained cycle of wage-related
inflation.
Additionally,
supply chains have adapted in ways that add to structural inflation. After the
global supply chain disruptions of recent years, companies are prioritizing
resilience over pure cost efficiency.
This
shift translates to higher production costs as businesses bolster local and
regional sourcing, adding redundancies and buffers into their logistics. While
it enhances stability, it also means prices across various sectors are likely
to remain elevated compared to pre-2020 levels. And the energy sector is no
exception.
While
prices have seen some relief, volatility persists due to geopolitical factors,
ambitious climate policies, and a renewed focus on domestic production. Fink’s
perspective that inflation remains embedded reflects an understanding of these
deep-seated adjustments.
But
what does this mean for investors? First and foremost, a controlled Fed
approach offers the best foundation for long-term market growth. Investors
should take heart that rate cuts may not come swiftly.
A hasty
reduction could unleash rapid inflationary pressures, putting the Fed in a
reactive stance that historically leads to harsher, more disruptive
corrections. Instead, a conservative stance lets the economy adjust
organically, a scenario that nurtures business expansion and investment over a
multi-year horizon. Fink’s analysis, rooted in pragmatism, argues against a
short-term solution for what is clearly a long-term issue.
For
investors, this controlled environment means steadier opportunities for market
appreciation rather than the unpredictability of drastic policy shifts.
There’s
also a strong argument that moderate rates provide a favorable climate for
equities and growth assets. As rates remain elevated but steady, companies can
make predictable adjustments to their borrowing, labor, and expansion
strategies.
This
creates a market where valuations stabilize, allowing savvy investors to
identify strong, high-growth companies trading at reasonable prices. For those
who are bullish on tech, healthcare, and renewable energy, sectors with
future-facing fundamentals, the current environment presents a time to seize on
opportunities that could flourish as the economy adapts to the inflation
landscape.
Fink’s
stance is a refreshing reminder to step back from immediate gratification and
instead see the value in a tempered, stable monetary approach. Embedded
inflation may feel frustrating, but it’s also a signal of an economy that’s
robust enough to sustain expansion, job creation, and wage growth.
By
resisting overly aggressive cuts, the Fed can avoid reigniting unsustainable
spending and debt cycles, which would only delay the inevitable need to rein in
inflation. Fink’s realistic perspective acknowledges the real drivers at play
and calls for patience — a critical ingredient for any serious investor looking
to build wealth over the long haul.
So,
while markets may wish for fast rate cuts, the stronger play is in Fink’s view
of calculated restraint. Investors should remain optimistic; the economy has
shown it can weather moderate rates without stumbling.
For
those who embrace a longer-term perspective, this is a chance to build
positions in strong sectors poised for growth in a new era of stability, not
dependency on endless policy intervention.
Connecting
the Dots:
Jerome H. Powell (Jay)
is the Chairman for the Federal Reserve System and was a partner at
the Carlyle Group.
Edward J. Mathias is
a managing director at the Carlyle Group and a director at
the Economic Club of Washington.
David M.
Rubenstein is a co-founder & co-CEO for the Carlyle Group,
the president of the Economic Club of Washington, co-chairman for
the Brookings Institution (think tank), a friend of David
Rubenstein and (Joe Biden spent
Thanksgiving with him).
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
George Soros was the chairman for the Foundation
to Promote Open Society.
Vernon E. Jordan Jr. is an honorary trustee at the Brookings Institution (think tank) and was the president of the Economic Club of Washington.
Ben S. Bernanke is a distinguished fellow at the Brookings
Institution (think tank) and was a chairman for the Federal Reserve
Board.
Lael Brainard is
a member of the Federal Reserve Board and was a VP &
director for the Brookings Institution (think tank).
Karen Dynan was
a senior adviser for the Federal Reserve Board and a VP for
the Brookings Institution (think tank).
Douglas W.
Elmendorf was an assistant director, Research and Statistics for
the Federal Reserve Board and a senior fellow
at the Brookings Institution (think tank).
Donald L. Kohn was
a vice chairman for the Federal Reserve Board and is a senior
fellow at the Brookings Institution (think tank).
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
George Soros was the chairman for the Foundation
to Promote Open Society.
Thomas
E. Donilon was a trustee at the Brookings Institution (think
tank), the White House deputy national security adviser for the Barack
Obama administration, is a friend of Thomas E. Donilon, the
chairman for Blackrock and married to Catherine Russell (Jill Biden’s Chief of Staff).
Catherine
Russell was married to Thomas E. Donilon and Jill
Biden’s chief of staff.
Jill Biden’s
chief of staff was Catherine
Russell, the first lady for the Joe Biden Administration and
is married to Joe Biden.
Joseph R.
Biden Jr. was the president of the Joe Biden Administration,
(spent Thanksgiving with David M. Rubenstein),
is married to Jill Biden and a regent at the Smithsonian
Institution.
David M.
Rubenstein is a regent at the Smithsonian Institution, (spent Thanksgiving with Joe Biden), the
co-chairman for the Brookings Institution (think tank), the
president of the Economic Club of Washington a co-founder &
co-CEO for the Carlyle Group and was a partner at Pillsbury
Winthrop Shaw Pittman LLP.
Edward J. Mathias is
a director at the Economic Club of Washington and a managing
director at the Carlyle Group.
Jane Sullivan
Roberts was a partner at Pillsbury Winthrop Shaw Pittman LLP and
is married to John G. Roberts Jr.
John G. Roberts
Jr. is married to Jane Sullivan Roberts, the chancellor
for the Smithsonian Institution, the chief justice for the U.S.
Supreme Court and an honorary member of the Robert Trent Jones Golf
Club (Gainesville, VA).
Vernon E. Jordan
Jr. is the president emeritus for the Robert Trent Jones Golf
Club (Gainesville, VA), an honorary trustee at the Brookings
Institution (think tank) and was the president of the Economic
Club of Washington.
Edward J. Mathias is
a director at the Economic Club of Washington and a managing
director at the Carlyle Group.
John Major was
the chairman of Carlisle Europe for the Carlyle Group and the prime
minister for the United Kingdom (UK).
Jerome H. Powell (Jay)
was a partner at the Carlyle Group and is the Chairman for
the Federal Reserve System.
David M.
Rubenstein is a co-founder & co-CEO for the Carlyle Group,
a regent at the Smithsonian Institution, (spent Thanksgiving with Joe Biden), the
co-chairman for the Brookings Institution (think tank), the
president of the Economic Club of Washington and a friend of Thomas
E. Donilon.
Thomas
E. Donilon
is a friend of David Rubenstein, the chairman for Blackrock,
married to Catherine Russell (Jill Biden’s
Chief of Staff), was the White House deputy national security
adviser for the Barack Obama administration and a trustee at
the Brookings Institution (think tank).
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
George Soros was the chairman for the Foundation
to Promote Open Society.
Vernon E. Jordan Jr. is an honorary trustee at the Brookings Institution (think tank) and was the president of the Economic Club of Washington.
Ben S. Bernanke is a distinguished fellow at the Brookings
Institution (think tank) and was a chairman for the Federal Reserve
Board.
Lael Brainard is
a member of the Federal Reserve Board and was a VP &
director for the Brookings Institution (think tank).
Karen Dynan was
a senior adviser for the Federal Reserve Board and a VP for
the Brookings Institution (think tank).
Douglas W.
Elmendorf was an assistant director, Research and Statistics for
the Federal Reserve Board and a senior fellow
at the Brookings Institution (think tank).
Donald L. Kohn was
a vice chairman for the Federal Reserve Board and is a senior
fellow at the Brookings Institution (think tank).
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
George Soros was the chairman for the Foundation
to Promote Open Society.
Larry D. Thompson is
a trustee at the Brookings Institution (think tank) and the
EVP of governmental affairs, general counsel & secretary for PepsiCo,
Inc.
Michael H. Jordan was
an honorary trustee at the Brookings Institution (think tank) and the
division chairman & CEO for PepsiCo, Inc.
Kimberly Cheatle
served as Senior
Director in Global Security at PepsiCo, Inc. and is the 27th director
for the U.S. Secret Service.
U.S. Secret
Service is a division of the U.S. Department of Homeland
Security.
Alejandro N.
Mayorkas was the secretary for the U.S. Department of Homeland
Security for the Joe Biden Administration and an attorney
at O'Melveny & Myers LLP.
Danielle C. Gray was
a lawyer at O'Melveny & Myers LLP and is an associate
counsel for the Barack Obama administration.
Derek Douglas was
an associate at O'Melveny & Myers LLP and a special
assistant for urban affairs for the Barack Obama administration.
Ronald A. Klain was
a partner at O'Melveny & Myers LLP and the chief of staff
to the vice president for the Barack Obama administration.
Thomas E. Donilon was
a partner at O'Melveny & Myers LLP, the White House deputy
national security adviser for the Barack Obama administration, a
friend of David Rubenstein, the chairman for Blackrock,
married to Catherine Russell (Jill Biden’s
Chief of Staff) and a trustee at the Brookings Institution
(think tank).
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
George Soros was the chairman for the Foundation
to Promote Open Society.
David M.
Rubenstein is the co-chairman for the Brookings Institution
(think tank), a regent at the Smithsonian Institution, (spent
Thanksgiving with Joe Biden), the president of the Economic Club of
Washington, a friend of Thomas E. Donilon and a co-founder
& co-CEO for the Carlyle Group.
Edward J. Mathias is
a director at the Economic Club of Washington and a managing
director at the Carlyle Group.
Jerome H. Powell (Jay)
was a partner at the Carlyle Group and is the Chairman for
the Federal Reserve System.
David M.
Rubenstein is a co-founder & co-CEO for the Carlyle Group,
a regent at the Smithsonian Institution, (spent Thanksgiving with Joe Biden), the
president of the Economic Club of Washington, a friend of Thomas
E. Donilon and the co-chairman for the Brookings Institution (think
tank).
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
George
Soros was
the chairman for the Foundation to Promote Open Society
and is the founder of the Soros Fund Management.
Keith T. Anderson was
a chief investment officer for the Soros Fund Management and a
co-founder for BlackRock, Inc.
Laurence D. Fink is
the Chairman & CEO for Blackrock, Inc. and a
director at the Robin Hood Foundation.
Foundation to Promote Open Society was a funder for Robin Hood
Foundation.
George Soros was the chairman for the Foundation to Promote Open Society.
Daniel S. Och is a director at the Robin Hood Foundation
and was a trader for the Goldman Sachs Group Inc.
Peter D.
Kiernan III is a director at the Robin Hood Foundation and
was a senior partner at the Goldman Sachs Group Inc.
David M. Solomon was
a leadership council member for the Robin Hood Foundation, is a
director at the Robin Hood Foundation and a co-head of investment
banking for the Goldman Sachs Group Inc.
Clifford S.
Asness was a leadership council member for the Robin Hood
Foundation and a managing director for the Goldman Sachs Group Inc.
Lloyd C. Blankfein was
a director at the Robin Hood Foundation and is the chairman &
CEO for the Goldman Sachs Group Inc.
John A. Thain was
the president & COO for the Goldman Sachs Group Inc. and is a
duplex owner at 740 Park Avenue, New York.
Steven T. Mnuchin was
the EVP & CIO for the Goldman Sachs Group Inc. and is a
resident at 740 Park Avenue, New York.
Bradley Abelow was
a partner & managing director for the Goldman Sachs Group Inc.,
the
president & COO for MF Global Holdings Ltd. and Jon S.
Corzine’s chief of staff.
Jon S. Corzine’s chief
of staff was Bradley Abelow, the chairman & CEO for the Goldman
Sachs Group Inc. and the chairman & CEO for MF Global Holdings
Ltd.
Soros Fund
Management was the buyer of assets, post-bankruptcy for MF
Global Holdings Ltd.
Keith T. Anderson was
a chief investment officer for the Soros Fund Management and a
co-founder for BlackRock, Inc.
George Soros is the founder of the Soros Fund Management
and was the chairman for the Foundation to Promote Open
Society.
Foundation to Promote Open Society was a funder for the Brookings
Institution (think tank).
Thomas E. Donilon is
a trustee at the Brookings Institution (think tank), the chairman
for Blackrock, a friend of David Rubenstein, married
to Catherine Russell (Jill Biden’s Chief of
Staff), was a partner at O'Melveny & Myers LLP, the
White House deputy national security adviser for the Barack Obama
administration.
David M.
Rubenstein is the co-chairman for the Brookings Institution
(think tank), a regent at the Smithsonian Institution, (spent Thanksgiving with Joe Biden), the
president of the Economic Club of Washington, a friend of Thomas
E. Donilon and a co-founder & co-CEO for the Carlyle Group.
Edward J. Mathias is
a director at the Economic Club of Washington and a managing
director at the Carlyle Group.
Jerome H. Powell (Jay)
was a partner at the Carlyle Group and is the Chairman for
the Federal Reserve System.
Resources:
Past Research
BlackRock
Pulls Ad Showing Gunman From Trump Rally (Connecting the Dots: BlackRock, Soros
Fund Management, O'Melveny & Myers LLP, Alejandro N. Mayorkas, Catherine
Russell (Jill Biden’s Chief of Staff), Kimberly Cheatle, U.S. Secret Service,
PepsiCo & Soros Funding, All Networking) (Past
Research on BlackRock)
Tuesday,
July 16, 2024
https://thesteadydrip.blogspot.com/2024/07/blackrock-pulls-ad-showing-gunman-from.html
Fed's
Goolsbee Sees Lower Interest Rates in a Year (Connecting the Dots: Austan D.
Goolsbee, Center for American Progress, The Federal Reserve Bank of Chicago,
The Federal Reserve System, The Commercial Club of Chicago, Jerome H. Powell
(Jay), The Carlyle Group, The Economic Club of Washington & Soros Funding,
All Networking) (Past Research on Jerome H. Powell,
the Carlyle Group & the Federal Reserve)
Saturday,
March 29, 2025
https://thesteadydrip.blogspot.com/2025/03/feds-goolsbee-sees-lower-interest-rates.html
Trump
Order on Smithsonian Targets Funds to Programs With 'Improper Ideology'
(Connecting the Dots: The Smithsonian Institution, The National Zoo, The
National Security Agency (NSA), The National Security Agency (NSA), The
Commercial Club of Chicago, Booz Allen Hamilton, The Friends of the National
Zoo, John G. Roberts Jr., The Economic Club of Washington, Nancy Pelosi wanted
Non-Coronavirus Pork for the Smithson Institution & Soros Funding, All
Networking). Ben Stein's Movie Expelled - No Intelligence Allowed, Exposes the
Smithsonian Institution. (Past Research on the Smithsonian
Institution)
Thursday,
March 27, 2025
https://thesteadydrip.blogspot.com/2025/03/trump-order-on-smithsonian-targets.html
Musk
on Trump Attack: Head of Secret Service Should Resign (Connecting the Dots: The
head of the Secret Service is Kimberly Cheatle, PepsiCo, Alejandro Mayorkas,
O'Melveny & Myers LLP & Soros Funding, All Networking) (Past Research on Kimberly Cheatle, PepsiCo, Alejandro
Mayorkas, O'Melveny & Myers LLP)
https://thesteadydrip.blogspot.com/2024/07/musk-on-trump-attack-head-of-secret.html
BlackRock
CEO Fink Warns N.Y. Could Lose Many Key Employers (Connecting the Dots: Larry
Fink, BlackRock Inc., Bloomberg News, Bloomberg LP, The Soros Fund Management
& Soros Funding, All Networking) (Past Research
on Larry Fink)
Tuesday,
April 8, 2025
https://thesteadydrip.blogspot.com/2025/04/blackrock-ceo-fink-warns-ny-could-lose.html
Trump
Names Former Goldman Partner, Soros Money Manager As Finance Chairman (Past Research on the Robin Hood Foundation & the
Goldman Sachs Group Inc.)
Friday,
May 6, 2016
https://thesteadydrip.blogspot.com/2016/05/trump-names-former-goldman-partner.html
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