Larry D. Fink, BlackRock, David Solomon, Goldman Sachs, and Tidjane Thiam, Credit Suisse, discuss the future of the dollar and markets at the Bloomberg Global Business Forum in New York on Sept. 26, 2018.
Larry Fink: Global Finance – View From the Top
Francine Lacqua: There’s a lot of risks out there. Guess what else a lot of opportunities for the financial sector. Larry let’s start off with you what are your top three risks that would change your business and your industry. Oh I would say probably the biggest risks it’s facing a financial services asset management businesses the move from the United States from multilateralism.
Larry D. Fink: To unilateralism. I’ve been traveling around the world a lot. That’s probably the number one issue I’m hearing from our clients worldwide today CEOs across the board. And I do believe the outcome could underscore could well could lead to a deep desire to create another payment system. I heard that. From sovereign wealth funds from CEOs of major large corporations large pension funds Europe Asia.
We build that foundation of multilateralism and we were the ultimate globalist and we are changing those that that design and we’re changing the design and forcedly on many organizations companies countries worldwide. And the reason why this is a particularly real big potential issue is we are budgeting to have a trillion dollar deficit for the next number of years.
Forty percent of our deficits today are domestic or are internationally financed.
And if there is a move it to another payment system is another alternative store of wealth. It could lead to real real dollar crisis not the dollar crisis that we’re seeing now for the emerging markets.
Francine Lacqua: That would take 20 years 30 years.
Larry D. Fink: No I don’t. I think that’s conventional wisdom. Just like conventional wisdom about how fast technology changes are always wrong. If there a will and the will is large. It’s less than 10. And it doesn’t happen. Just like the financial crisis that has been discussed before. We saw that the seeds of the financial crisis. It happens incrementally until it can’t sustain. And there could be moments where you’re seeing some organizations looking for were. Other than dollar based assets and that could lead to much higher interest rates here which creates much greater issues worldwide. If we had that that would be a big problem for BlackRock and other organizations.
Francine Lacqua: Tidjane Thiam do you worry about first of all trade tensions last for 20 years. And again the impact is actually being you know challenging I guess the U.S. as a reserve currency
Tidjane Thiam: Broadly agree with Larry but if you look at the financial system it’s much more robust than when we went into this. I mean balance sheets are being fixed. She says being one of the last ones she’s been shooting the woodwork he’s done issue with Molteno too and he’s a guy I talk to a lot of clients and we say exactly the same thing. Nobody knows what you have told TVs. And I’m not going to make a political statement. But what you’ve seen in Britain with Brits is what you overcome has been unable to come from two takers and the beats what we see.