Following are excerpts from the unofficial transcript of a CNBC interview with BlackRock Chairman & CEO Larry Fink on CNBC’s “Squawk on the Street” (M-F, 9AM-11AM ET) today, Friday, April 11.
BlackRock CEO Larry Fink: U.S. is very close to a recession and may be in one now
Fink on Recession
Larry Fink: I think we're very close, if not, in a recession now. What, what may be.
David Faber: You don't need that.
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Fink: Good but maybe happening is a lot of people are buying in advance of the elevated increases, like lines around Apple stores buying iPhones and all that stuff.
Fink on Uncertainty
Fink: I believe all the uncertainty is really making everyone pause and everyone's waiting to see. And so I think you're going to see that across the board and just say, slow down until we have more certainty. And, you know, we now have a 90 day pause on the reciprocal tariff that means longer, more elevated uncertainty.
Fink: I mean, to me, this is an opportunity to look for opportunities and because of all our clients having uncertainty, we are spending more time with more conversation, with more clients globally than at any time.
Fink on Inflationary Pressures
Fink: I still remain to be optimistic over the long run. Yes, we have to recalibrate. Yes, I do believe we're probably starting, if not, we're in a recession. Yes, I think the market is still anticipating, underestimating how high inflation can get. If you factor in all the tariffs, you factor in all these other issues, it's going to be quite additive.
Fink on Short Term Versus Long Term Outlook
This is not a pandemic. This is not a financial crisis. This is something that we've created, as I said. Also on Monday, United States post World War Two was a global stabilizer. We are the global destabilizer. And that's a very, you know, that's a very hard thing to say because I pride ourselves of being, you know, bringing the leadership, bringing the conversations. But I will say the power of U.S. capitalism is still alive. I will say more and more times, clients worldwide are asking for, you know, at least at the CEO level. They're asking for our vision, our views. They still want to engage. They still want to build. So I'm less, long term, I'm less worried about some of these issues but in the short run, I'm I'm petrified at some of these issues.
Fink on Yield Curve
Fink: I'm more worried about a much deeper yield curve and could I see a 5% 10 year? Sure. I don't believe the Federal Reserve has the, will have the ability to do any any real easings. I know the forward curves at one time a few days ago was four easings and I said there may not be any easing.
Fink on Relationship With China
Fink: One of my asymmetric views is we will have a strong relationship with China, one form or another. I do believe we do need a trading agreement with China. I hope there's a future where we have a conversation with China, where China agrees to buy $100 billion of our agriculture to help our farmers. I hope there's a future where China agrees to buy a large portion of their LNG with US producers. So there's, there are opportunities and I know at this time there's no conversation or little conversation. I know the whole issue that's going around it, but I do, I am hopeful that we are going to have conversations with China that will hopefully allow us to have relationships, that there is business.
BlackRock CEO Larry Fink: The capex needed for AI infrastructure is only going to grow
Fink on AI Data Centers
Fink: As we democratize AI, we need more data centers because the utilization will be greater. So this is a, there is short term—
Faber: Yes but the costs are going to go up, aren't they conceivably for the servers that go into a data center?
Fink: Now a one gigawatt data center with all the GPUs, all the power, all that we're talking $50 billion per data center.
Fink on Deterioration of the Dollar
Fink: 40% of our deficits are financed by foreigners. Okay. That's what we're worried about manufacturing overseas. How about our ownership of our own credit markets so large overseas. That is a risk. And it is a big risk. And so I'm not surprised to seeing a deterioration of the dollar which means dollars are coming back.
