- The conference has heard recurrent themes in the first day, with business and world leaders warning that there is a social revolution taking place across the world
RIYADH: The world is shrouded in great uncertainty with many nations undergoing significant changes, some for good, others seeing their economies suffer, according to BlackRock founder and CEO Larry Fink.
He said that while the Chinese economy was continuing to grow, and consumption would drive the US economy, European countries would “stumble along.”
Although he conceded that nations such as the Netherlands and France were “doing well.”
He warned that an increasing disparity of incomes and a failure by younger generations to invest for the future could lead to further social unrest.
But, he said, speaking at the Future Investments Initiative in Riyadh on Tuesday, that he believed there would be “higher equity markets in 2020.”
The conference — now in its third edition — has heard recurrent themes in the first day, with business and world leaders warning that there is a social revolution taking place across the world.
Fink said he believed there were “a lot of bad companies operating in the world.”
He warned that there was an increased level of inequality, with more people having climbed into the middle classes.
But he warned there was a rise in wage disparity and a failure to encourage younger generations to invest for the future.
He warned that with the increased influence of social media, there would be more social unrest, “because society is empowered by social media,” he said, adding: “People are able to quickly organize demonstrations.”
He said the issue was “critical” and needed to be addressed urgently.
Fink was echoing comments made in an earlier session by John Waldron, president and chief operating officer of Goldman and Sachs Group.
“The internet and social media is making it extremely difficult to manage companies and countries. The anger that social media mobilizes makes it particularly challenging. You have to be fast and responsive,” Waldron warned.
“Everybody in the world now is understanding that change is happening so fast, if you don’t get with the program, you’re left out.”
Fink said there was a greater need for improved cohesion between the public and private sectors with a long-term aim of improving earnings.
He said this could only be achieved through stronger leadership both at a governmental and corporate level.
“We are not focused on long-term outcome for tens of years and this is something we have to improve on,” he added.