Consumers are going to be feeling the pain of rising energy costs and rising food costs. In the short run, it's obviously quite impactful on the negative side. And I do believe it is going to- I think this is a reminder to every country, as it is a reminder of every company, access to capital is a privilege, not a right. And I think it's going to be so impactful. LARRY FINK: What you're seeing is the economic response that is so immediate and so quick. What will be the impact for global growth, but more specifically European economic growth? But the main theater of war is actually happening in Europe. SAMARA COHEN: This is a global economic war. I think this just really shows the power of one capitalism, but the power of the global capital markets, but importantly, the power of capitalism focusing on their stakeholders. I applaud the fortitude of management teams of companies and boards in these actions. So it's recalibrating a lot of companies. We are going to expect to see in every first quarter result by many companies that they're going to have an impairment charge from the abandonment of Russia. And now denying capital, it shows the power of, I would say, capitalism. So when you think about it from the government sanctions to the impact by the private sector of the abandonment or cessation of business in Russia, it really does show the power of the capital markets. What are you doing about this? And the behaviors of the private sector have been just as broad, impactful as the governmental sanctions. It is in many ways a really important statement to see how corporations are really embracing stakeholder capitalism here because so many companies have been bombarded by questions by their employees, by their clients, by different customers worldwide. This economic war is not something that one should take lightly. And we're witnessing now that an economic war can be as fulsome as any imagination could ever achieve. We've created in two weeks an enormous change. And I think this has been exemplified by the behaviors of the private sector. LARRY FINK: Well, as I wrote in my CEO letter earlier this year, I stated that access to the global capital markets is a privilege. So what are your thoughts on the markets? And now Russia is pursuing a traditional war, but the response of the capital markets is anything but traditional. Russia was given access to global capital markets as the world emerged from the Cold War. SAMARA COHEN: Let's talk a little bit more about your point on global capital markets. What does it mean? What does it mean for globalization? I've been on the calls with many CEOs today and yesterday and every day since the invasion, and I'm hearing from fear to concern, but most universally is this uncertainty. How do we move forward as companies, as countries. And we don't have enough answers yet because we don't know the outcome. Now we're trying to reassess what does it mean for the future. But the foundation of how we constructed the global model is now over. We built this whole foundation of globalization. Over the last 30 odd years now corporations worldwide expanded geopolitically and expanded in different geographies. And we were able to have this enormous peace dividend.
It's threatening the psyche of the world in so many ways because the world benefited, probably as much as any major geopolitical issue, when the Soviet Union broke apart. We are witnessing each moment of the tragedies that are occurring throughout Ukraine, the humanistic tragedy of 2 and 1/2 million migrants, in which half of them now are children, the displacement of millions of people. We were witnessing the horrific actions of a military war. And in addition, this nuclear power, Russia, it actually invoked the words 'nuclear' as an offensive moment. But this is different because we have a principal nuclear power invading a neighbor. LARRY FINK: Well, we've actually had many wars in the world over the last 20 years, in the last 30 years. And although the world has unfortunately seen conflict and wars break out over the past 20 years, this one feels different. SAMARA COHEN: Larry, the world has changed dramatically over the past two weeks. Please keep in mind, we're recording this on Friday, March 11, as the conflict enters its third week. On this episode, we're joined by our Co-founder, Chairman, and CEO of BlackRock, Larry Fink, to get his perspective on what's happening and how it's affecting the global markets. Over the past few weeks, the Russian invasion of Ukraine has caused a huge humanitarian issue and sent ripple effects across the global economy. I'm Samara Cohen, Chief Investment Officer for ETFs and Index Investments at BlackRock and your host today. SAMARA COHEN: Welcome to The Bid, where we break down what's happening in the markets and explore the forces changing investing.
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