Every year, Larry Fink, CEO of ten trillion(!) dollar asset manager Blackrock, writes a public letter to his constituents, posted on BlackRock’s website. For the uninitiated, BlackRock manages the money of pension funds, endowments, family offices, and individual investors to produce consistent investment returns over the long run, with horizons of ten, twenty, and thirty years.
BlackRock relies on the telephone game of diversification of assets across multiple asset classes to produce consistency of returns. Such asset classes generally consist of fixed income, private equity, real estate, and many other classifications either tied to the type of investments or the distribution vehicle used to produce returns on those investments.
Never mind the notion that asset management has for years been chasing an index of self, producing infinite regression of human excellence, better described as navel staring. Asset management itself needs to be reinvented to expand the fractal of human ingenuity. Yet I digress, not the topic of this diatribe.
Neither will the chase for misplaced climate change funds promulgate new startups worthy of improving human adaptability to nature’s entropy. What could possibly go wrong when humanity does not have or abide by an evolutionary compatible theory? Everything.
The letter Fink writes every year mimics that of a politician, coddling every possible constituent doing business with BlackRock. A middle-of-the-road approach in his letter that will not stir the BlackRock pot of managing more money.
BlackRock became a late and lackluster proponent of ESG, a fundamentally flawed evolutionary strategy invented by financiers, as pension funds pressured them to become a so-called responsible investor.
In this year’s letter, Fink is pulling back on the empty sack of feigned evolutionary responsibility to merely serve the needs of capitalism. As if capitalism without a theory directing the compass of human expansion builds a better world.
Larry Fink is right. He is not responsible for the deployment of capital that builds human excellence. Government is. And a strategy of ESG, hinging on the pretense of sustainability, is incompatible with the strength of renewal predicated by nature.
Larry Fink is wrong to assume that capitalism is even a system from which a predictable outcome or even trust can be inferred. Simply because capitalism is not subjugated to an evolutionary theory for humanity, capitalism will produce nothing more than all-for-me and nothing-for-anyone-else vile-maxims that have already caused the evolution of humanity to diverge so damagingly from nature’s evolution.
BlackRock’s arbitrage redirects the vector of human evolution across the globe, further away from evolutionary excellence. First, BlackRock’s retrofit on ESG and now back to the blind faith in capitalism without evolutionary relevance will not produce the correction needed for humanity to improve human adaptability to nature’s entropy.
I agree with Larry Fink; BlackRock is not responsible for defining the humanitarian gameplay that his firm must abide by. The government is responsible for determining the theory that promotes the excellence of human renewal for many generations to come and defining how humanitarian excellence can be achieved.
The failure of the government to establish a compatible evolutionary theory yields the wild growth of asset management firms perpetuating out-of-control humanitarian cancer, growth for the sake of growth incompatible with the strength of human renewal.
Nature’s arbitrage binds human evolution. An evolution we now know so much more about from when laissez-faire capitalism was first unleashed. We must begin to deploy a new interpretation of nature’s evolutionary theory to improve the theory by which the arbitrage of finance is deployed.
Just like in sports, we must first deploy the name of the game we play before we can assign evolutionary merit to the players of the game.