Even Larry Fink, who was saying that we don’t need QE3 a few months ago, sounds more bearish right now.Fink said at the Barclays Capital global financial conference:
“[For long-term investors] it makes no sense to have a portfolio of (only) bonds, other than being frightened of the world.”
“Right now, maybe being frightened of the world is a good position to be in.”
“This (volatility) is not a good short-term trend for the asset management business.”
In June, the BlackRock CEO presented a view on bonds that cost him some money.
There will be so little demand for bonds that it’s not a huge profit opportunity, he said in June. Of course August was a huge month for Treasuries.
Fink admits the error. He said at the Barclays conference:
“[BlackRock’s ETF performance was] poor in the last year and much of it was our doing… It wasn’t because of the success of Vanguard. It was because of the failure of BlackRock.”
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