Opposition to data centers will drive up inflation, says BlackRock's Larry Fink

By Barbara Kollmeyer

BlackRock CEO Larry Fink pictured on March 11, 2026 in Washington, DC. Fink warned Wednesday that a pushback against building data centers is detremental to the U.S. economy.

BlackRock's chief executive Larry Fink has doubled down on the importance of data-center building to the health of the U.S. economy, saying not pushing ahead could be inflationary.

"About two-thirds of the U.S. economy is capital expenditures right now on technology, whether it's cloud or whether it's AI, whether it's just a capex of making sure you're competitive," said Fink, speaking to Bloomberg on the sidelines of the Berlin Global Dialogue conference on Wednesday.

"If we slow down the build out of this technology, I think it really does jeopardize the economy. It means we're not going to build these. It means we're building elsewhere," he said, noting that Canada, India or Abu Dhabi could become alternatives.

"If we don't build out these data centers, it is actually more inflationary because the cost to compute is so high right now. And the faster we can build up more data centers, the more compute we have, the faster we can bring down the cost," he said on Wednesday.

Hyperscalers in the U.S. alone are talking about $7 trillion to $9 trillion that's needed to finance that building and keep the U.S. in a leading position on AI, he said.

That type of funding, on top of financing for the federal deficit, is pushing up the term premium - the extra return demanded by investors to hold longer-term Treasurys - which is bound to just keep rising, he said.

The 10-year U.S. Treasury BX:TMUBMUSD10Y has climbed nearly a full percentage point this year, closing Tuesday at 5.12%.

There has been increasing opposition to data centers by U.S. communities.

An August survey by the University of Pennsylvania's Annenberg Public Policy Center showed 61% of Americans are somewhat or strongly opposed to building new data centers where they live, versus 49% about four months earlier. Recent data from Heatmap Pro showed at least $260 billion in data-center cancellations in the U.S. this year so far due to local opposition.

Fink blamed fear of data-center building on "misinformation," saying that tech companies and builders need to work better with communities and not use all the resources such as water.

"For the U.S. to be a leader in this technology, which we are today, we also have to be the leader in the compute, the inference in our own nation," he said.

Turning to markets, Fink urged investors to not get overly focused on daily volatility, pointing out that an investor putting money in the S&P 500 over the past 25 years and letting it sit would have earned an 11% compounded return. "If you believed you were smarter than the market for ten days, just ten days, your return was down to 6%. If you were out of the market for the top 40 days, out of 6,300 days, you had a negative return," he said.

The S&P 500 SPX, dominated by big tech players, is up 12.6% this year, but the equal-weight S&P 500 RSP is returning the same, as investors have rotated out of tech in recent months on worries about whether AI investment will pay off.

-Barbara Kollmeyer

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