BlackRock head Larry Fink is enraged that Andrew Ross Sorkin’s book Too Big to Fail
claims that his firm’s balance sheet was badly hurt by subprime during the financial crisis, according to a person familiar with the matter.
Sorkin writes that “BlackRock’s balance sheet had continued to deteriorate—it was loaded with subprime loans the company had been unable to get rid of, and it likely needed to raise more money.”
In fact, BlackRock made it through the crisis unscathed. Indeed, the 21-year old firm started by Larry Fink is now the largest money manager in the world. It has a mind blogging $2.7 trillion in assets under management.
Fink is pissed off about the error and is considering demanding a public retraction, the person said.
It looks like this might all be a relatively minor mix-up. The error comes in Chapter 7, when Sorkin is describing discussions between Fink and Greg Fleming, who was president at Merrill. CNBC had reported that John Thain was considering selling its stake in BlackRock. Fink called Fleming to yell at him about it.
It appears that in talking about the two companies, Sorkin may have just written BlackRock when he meant Merrill Lynch. It was Merrill whose balance sheet was deteriorating because of subprime exposure, not BlackRock.
Most readers might not even notice the error, mentally substituting the correct company. But most readers aren’t Larry Fink, who is understandably upset at having his firm portrayed in such a bad light.
In fairness, any book of the size of Sorkin’s, and obviously written hastily so it could be published near the anniversary of the collapse of Lehman, will have errors. (We make plenty of similar errors ourselves.) Errors like this can be corrected in subsequent printings of the book. But we’d sure like to hear Sorkin explain that to Fink.
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