The CEO of the world's largest investor thinks layoffs are on the way

My Fear... Retirement Inadequacy: Larry Fink
My Fear... Retirement Inadequacy: Larry Fink

Markets have been going haywire.

And according to Larry Fink, CEO of BlackRock, that has the potential to lead to layoffs through the first half of the year.

BlackRock is the world's largest investor, with around $4.5 trillion under management.

He said in an interview Friday morning with CNBC that the market volatility of late had the potential to impact CEO confidence, and could lead to more layoffs.

He said (emphasis ours):

Having a market decline like this in the first couple of weeks of the year really, in my mind, puts a negativity across the economy. A negativity to every CEO who is looking at his or her stock price. A negativity related to business and the forward thinking about businesses. I actually believe you're going to start seeing more layoffs in the middle part of the first quarter, definitely the second quarter because of this. If we don't see some swift rebound – and as I said I think we're going to have probably more pain before we have that lift – but I do believe by the second half of the year the markets going to be higher.

His comments stand in contrast to those of Jamie Dimon, CEO of JPMorgan. On a conference call Thursday, Dimon said that while those in the finance industry look at market turmoil every day, it was unlikely that "143 million Americans who have jobs look at it that much."

"We're not forecasting a recession — I think the US economy looks pretty good at this point," he continued.

Fink also had some interesting comments on consumer spending (emphasis ours):

We have to find out why consumers are not spending their energy savings. It's significant in all the years, when we've had these big declines, the consumers use that savings to spend and consume other things. We're not seeing that, we're seeing some consumption. My fear – and we've been talking about retirement in America – my fear is we're starting to – people coming to terms with what they have an inadequacy in their retirement.

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