"We have a risk of collapse, not a collapse here."
Black Rock Inc.
BLK, + 1.72%
The Chief Exeuctive Larry Fink says, with stocks knocking on the door of world records, a rise seems more likely than a collapse of the market. The reason is that so many investors still have a lot of money available, said the head of the world's largest asset manager to CNBC in an interview on Tuesday.
"Despite the stock markets, we have not seen any money work," Fink said. "We have a record-breaking cash."
A collapse is often defined as an unexpected and unexpected price rise for an asset class that is driven above all by a rush of investors who are more worried that they will miss a major fund rise than by improving the fundamentals of the market. Smelting is often followed by a heavy setback on the market.
After a strong sell-off in the fourth quarter that spiked the S & P 500
SPX, + 0.33%
and the Dow Jones Industrial Average
DJIA, + 0.48%
corrected while holding back shortly before a bear market, defined as a 20% decline from a recent high. For the current year, the S & P 500 has risen 1
Lipper's data showed last week that US equity funds generated $ 4.3 billion in inflows during the week ended on April 10, but this followed a $ 19.7 billion outflow at the end of last year until the 3rd of April.
Read: Individual Investors Will Become Bullish as the Stock Market Reaches an All-Time High
The stock market rally that has taken place so far this year is partly due to a reluctant US Federal Reserve shift, which abruptly interrupted policy tightening in January and introduced a cautious approach after four rate hikes in 2018. Fed decision makers have signaled that they do not expect rate hikes this year. Meanwhile, the European Central Bank, which ended its bond-buying program at the end of last year, introduced a new round of bank stimulus amid new economic weakness in March.
Fink said central bankers' consideration creates a lack of "good assets" that could serve as a trigger for a global collapse in stock prices.
BlackRock reported a first quarter profit decline on Tuesday, driven by a price war that continues to affect the entire asset management industry. Assets under management increased to more than $ 6 trillion from a decline at the end of 2018.