BlackRock CEO calls for participation in long-term investing to be widened

BlackRock co-founder, chair, and CEO, Larry Fink, has called for participation in long-term investing to be widened so more people can share in economic growth.

In his annual chair’s letter, Fink focused on how the next phase of global growth will rely on broadening ownership in the capital markets, in order for more people to benefit from value creation.

He argued that long-term investing connected people to their country’s economic growth, describing long-term investing as a “kind of civic miracle” when at its best.

“When people invest their savings - over decades, not days - the capital markets put that money to work, financing companies, infrastructure, and jobs,” Fink continued.

“And when that cycle happens in your own country, your future and your nation’s future become linked.”

In the letter, Fink explored how three ‘structural forces’ were reshaping the economy.

He highlighted that countries were pursuing self-reliance, and as the world reorganised around this trend, greater long-term investment was needed.

The second structural force identified was market gains outpacing wage growth, with Fink noting that most of the wealth flowed to the capital markets, and too few people were invested in them.

The risk of artificial intelligence (AI) further concentrating value was highlighted as the third structural force.

Fink argued that AI would create “significant economic value”, and ensuring that participation in that growth expanded alongside it was both “the challenge and the opportunity”.

To expand global access to ownership, the letter highlighted the importance of stronger retirement systems, earlier pathways to investing, and modernising market infrastructure.

“We are living through a period where things that would've defined a decade have become routine: wars with global repercussions, trillion-dollar companies, a fundamental reordering of international trade, and the advent of the most significant technology since, at least, the computer,” Fink stated.

“Too often, this gets filtered through a short-term lens. Daily market moves are treated as signals of lasting change, and complex economic or technological transitions are compressed into headlines.

“Meanwhile, the vast majority of wealth has flowed to people who owned assets, not to people who earned most of their money by working. Since 1989, a dollar in the US stock market has grown more than 15 times the value of a dollar tied to median wages.

“Now AI threatens to repeat that pattern at an even larger scale - concentrating wealth among the companies and investors positioned to capture it.

“This is where much of today’s economic anxiety comes from: a deeper feeling that capitalism is working - just not for enough people. And a focus on short-term investing is not a fix for that.

“Rather, it is long-term investing that allows countries to build domestic industries, that lets people build enduring wealth and shows how their country’s growth can benefit them too.”

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