Tuesday, July 21, 2009

BlackRock Predicts Choppy Markets

BlackRock (BLK) issued Q2 results and claims it’s all improving. Read this effusive quote.

“BlackRock’s results reflect improving momentum in the business. Equity and fixed income markets have improved during the second quarter, more than offsetting first quarter market declines and contributing to positive momentum for net new business. BlackRock continues to maintain cost discipline and to benefit from a strong and diversified business model.”

The quote was preceded by this sentence

“Net income, as adjusted (2), was 117% higher than first quarter 2009 and 16% lower than second quarter 2008.”

Laurence D. Fink, Chairman and CEO of BlackRock inadvertently commented on Blackrock’s prospects when he praised his own managers by saying “While markets were significantly more favorable during the second quarter, they remain choppy in the face of conflicting signals about global economic conditions. These are difficult conditions for portfolio managers to navigate, and I am proud of the job our teams are doing.

That is the essence of BlackRock. The markets are choppy. Conflicting signals which can change in the blink of an eye are more the norm.

In the Blackrock press release there is no real information on how the company is planning to sail in choppy waters.