Stocks touching record highs, economic expectations on the mend, consumer confidence through the roof: The market outlook doesn't look so bad for the average observer. But Larry Fink is not your average observer. Where you see life and light, Fink beholds only death and despair. His gaze pierces your cheery exterior to reveal the darkness within.
“I see a lot of dark shadows that could impact the direction of the marketplace,” the BlackRock CEO said Wednesday at Yahoo's All Markets Summit. “I’m much more worried about the world and the level of equity markets than I think consensus today.”
The most “horrifying” of all: the good spirits of the great unwashed masses.
“I found that slide horrifying,” Fink said, suppressing a deep involuntary shudder at the chart. “Maybe you should be selling now.”
Fink isn't alone in his brooding thoughts. Baupost Group founder Seth Klarman set Wall Street abuzz with a downbeat letter to investors that recently found its way into the public, warning over the dangers of the Trump presidency. “If things go wrong, we could find ourselves at the beginning of a lengthy decline in dollar hegemony, a rapid rise in interest rates and inflation, and global angst,” he wrote. “Exuberant investors have focused on the potential benefits of stimulative tax cuts, while mostly ignoring the risks from America-first protectionism and the erection of new trade barriers.”
Goldman Sachs' macro team has shifted from a reservedly bullish view of markets under Trump to a “less positive” stance. Nouriel Roubini, meanwhile, wrote that “the corporate sector’s animal spirits may soon give way to primal fear: the market rally is already running out of steam, and Trump’s honeymoon with investors might be coming to an end.”
So, there's your new narrative. Embrace the dark side.