Larry Fink Proposes “Second Draft of Globalization”

Very Average Joe
Aug 5
3 min read

The CEO of BlackRock, Larry Fink, thinks he’s got the answer to so-called globalization in an opinion piece titled “It’s time for the second draft of globalization” at the Financial Times.

The Trump administration’s tariffs are the symptom of a backlash to the era of what might be called “globalism without guardrails”. Global GDP grew more since the fall of the Berlin Wall in 1989 than in all recorded history before it. But the benefits weren’t evenly shared. S&P 500 investors saw a return of more than 3,800 per cent. Rustbelt workers did not.

Thanks, Larry, for pointing that one out. Also note the subtle dig at President Trump by mentioning the tariffs.

So it’s no surprise that this model of globalisation is now coming apart. But its proposed replacement—economic nationalism behind sealed borders—isn’t any more convincing.

Globalization is not working but he doesn’t like “economic nationalism” either. Right.

But fear not, Larry has figured it out. He admits that whilst globalization allows capital to “move freely”, it doesn’t benefit the little people. So, in a more nationally focused approach, “markets channel citizens’ savings into local businesses and infrastructure”.

The first step? Helping more people become investors. This is the deeper shift I’m seeing in the economy. Governments are rethinking whom markets are for. For decades, they primarily served countries’ wealthiest citizens and largest institutions. Now, countries are democratising markets recognising that the same factory worker left behind by globalisation can be an investor, too.

So Larry wants to “help” more people become investors. Would that be to “help” or “make”? Either way, for a fee, no doubt.

But Larry is not totally unrealistic.

But creating more investors is only half the battle. Every market has two sides: the people who invest, and the places where capital gets put to work. Ensuring it’s put to work domestically is hard, and in Europe, for instance, it has triggered an economic reckoning.

At least Larry recognizes that the money is supposed to go somewhere and do something (in a world of investment). He then points out the usual bureaucracy problems, specifically in Europe, that make investments difficult. Referring to how the EU is moving to overcome those problems to form a “true savings and investments union”:

If I were an EU politician, that union would be my top priority. Investors will be watching closely to see if the reforms stick.

Yes, one can see that Larry would want such a union. It would make it easier for someone like him to play with it. And it also reads a bit like the waffle that Klaus Schwab and Thierry Malleret wrote in COVID-19: The Great Reset.

In any case, he concludes with the following enlightened view:

Of course, expanding markets won’t fix everything. Unchecked, financialization can fuel inequality. That was the first draft of globalisation: enormous wealth, unevenly distributed, with little thought for who benefited—or where. What’s emerging now is globalisation’s second draft, a re-globalisation built not just to generate prosperity, but to aim it towards the people and places left behind the first time.

Thanks, Larry, for saying next to nothing. He wants to replace globalization with… with… with… re-globalisation by having people invest in markets that need reform and expansion. Right, got it.

By the way, setting aside what people do with their money is none of Larry’s business, notice the discussion doesn’t even explain why there needs to be “investment” from/by us little people?

Money is meant to represent human effort (work). Any discussion about fixing the financial system that does not include this fundamental point is a waste of time at best or an attempt to deceive at worst. So shut up, Larry.