Quantcast
The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Does BlackRock Still Have Political BFFs? Not Rated 0.0 Email Routing List Email & Route  Print Print
Monday, February 10, 2014

Does BlackRock Still Have Political BFFs?

News summary by MFWire's editors

Maybe six years is the shelf-life for political gratitude. Remember at the beginning of the financial crisis, when the government and other power-brokers turned to BlackRock to help clean up their messes?

BlackRock back then had been a friend-indeed for a number of friends-in-need: top officials from Federal Reserve, J.P. Morgan Chase's Jamie Dimon, Morgan Stanley's John Mack, and A.I.G.'s Robert Willumstad all turned to BlackRock for help. CEO Larry Fink acted like the godfather of Wall Street to provide advice on solving the debt crisis, including on financing the sale of Bear Stearns to J.P. Morgan and rescuing Citigroup.

Yet today, to avoid the potential conflicts of interest, the leading candidate for vice chairman of the Federal Reserve, Stanley Fischer, who also owns $56.3 million assets, declared that if confirmed he and his wife would sell their holdings in nine companies including BlackRock.

The move was Politics 101, inevitable, but it also raises the question of whether CEO Larry Fink’s political web had gotten too big and whether some strands are beginning to break.

There are few firms that have benefitted from such clout in Washington’s inner power circles. Sure Pimco has done well in the past, as reported in this CNBC article. Yet, only Fink, a lifelong Democrat, and BlackRock have garnered the nickname “shadow government” from some. Take, for instance, the contract between BlackRock and Fed, regarding two-month's work on the Citigroup portfolio, which made the firm $12 million.

In a feature story about Fink published by Vanityfair, Suzanna Andrews sketched the countless key contracts that BlackRock was awarded "with no competitive bidding, in a process enveloped in secrecy, has also raised hackles in Congress and led to questions about Fink’s long-standing relationships with senior government officials, particularly former Treasury secretary Henry Paulson and Geithner, his successor."

Maybe six years is just long enough for the gratitude of the powerful to fade. Maybe BlackRock’s web is untangling.  

Edited by: Amy Xie


Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE

0.0
 Do You Recommend This Story?



GO TO: MFWire
Return to Top
 News Archives
2017: Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Raw XML
Add to My Yahoo!
follow us in feedly




©All rights reserved to InvestmentWires, Inc. 1997-2017
40 Wall Street | 28th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use