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BlackRock CEO Warns Data Center Moratorium Would Trigger US Recession

BullishMedium impact
BLK$1,077.90 1.10%

BlackRock, Inc. (BLK) Chief Executive Officer Larry Fink warned that halting data center development in the United States would plunge the nation into an economic recession. Speaking on Wednesday, Fink emphasized that private investment in artificial intelligence infrastructure is essential to sustain national economic expansion, pointing out that current capital expenditure in computing facilities drives a major portion of overall economic output.

To help fund growing infrastructure demands outside big technology balance sheets, BlackRock is developing a new financing framework in partnership with chip producers and cloud providers. The asset manager is gathering data on hardware longevity to create credit ratings based on the residual value of chips, working alongside firms including Advanced Micro Devices, Inc. (AMD), Broadcom Inc. (AVGO), and Alphabet Inc. (GOOG, GOOGL). Fink noted the effort could take about a year to establish securitized AI hardware structures for private investors.

The comments arrived as BlackRock delivered third-quarter financial results that surpassed analyst expectations. The asset manager reported quarterly earnings of $15.93 per share on $7.75 billion in revenue, while total assets under management reached a record $15.5 trillion. Investors will watch how rating agencies and hardware partners receive BlackRock's proposed financing model over the coming year.

Key points

  • BlackRock CEO Larry Fink cautioned that placing a moratorium on U.S. data center construction would trigger an economic recession.
  • The firm is designing a new financial structure to securitize AI chips with partners including Advanced Micro Devices, Broadcom, and Alphabet.
  • BlackRock reported third-quarter earnings of $15.93 per share on revenue of $7.75 billion, beating Wall Street estimates.
  • Assets under management at BlackRock reached a record high of $15.5 trillion.

Written by our AI from expert market sources across the web. It can contain mistakes: check the facts before acting on them. Write-ups powered by the free AI API at FreeTheAI.org

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Questions and answers

What did BlackRock's CEO say about data centers?

Larry Fink stated that imposing a moratorium on U.S. data center construction would trigger an economic recession due to reliance on AI infrastructure investments.

What were BlackRock's third-quarter financial results?

BlackRock reported earnings of $15.93 per share on $7.75 billion in revenue, topping Wall Street forecasts, with assets under management reaching $15.5 trillion.

How is BlackRock planning to fund AI computing hardware?

BlackRock is gathering hardware longevity data to establish credit ratings based on residual chip values, aiming to build a securitized financing model for AI hardware.