Fed chair’s official schedule from that March. Those calendars generally track scheduled events, and may have missed meetings in early 2020 when staff members were frantically working on the market rescue and the Fed was shifting to work from home, a central bank spokesman said.

Mr. Powell’s calendars did show that he talked to Mr. Fink in March, April and May, and he has previously answered questions about those discussions.

“I can’t recall exactly what those conversations were, but they would have been about what he is seeing in the markets and things like that, to generally exchanging information,” Mr. Powell said at a July news conference, adding that it wasn’t “very many” conversations. “He’s typically trying to make sure that we are getting good service from the company that he founded and leads.”

BlackRock’s connections to Washington are not new. It was a critical player in the 2008 crisis response, when the New York Fed retained the firm’s advisory arm to manage the mortgage assets of the insurance giant American International Group and Bear Stearns.

Several former BlackRock employees have been named to top roles in President Biden’s administration, including Brian Deese, who heads the White House National Economic Council, and Wally Adeyemo, who was Mr. Fink’s chief of staff and is now the No. 2 official at the Treasury.

in early 2009 to $7.4 trillion in 2019. By the end of last year, they were $8.7 trillion.

As it expanded, it has stepped up its lobbying. In 2004, BlackRock Inc. registered two lobbyists and spent less than $200,000 on its efforts. By 2019 it had 20 lobbyists and spent nearly $2.5 million, though that declined slightly last year, based on OpenSecrets data. Campaign contributions tied to the firm also jumped, touching $1.7 million in 2020 (80 percent to Democrats, 20 percent to Republicans) from next to nothing as recently as 2004.

short-term debt markets that came under intense stress as people and companies rushed to move all of their holdings into cash. And problems were brewing in the corporate debt market, including in exchange-traded funds, which track bundles of corporate debt and other assets but trade like stocks. Corporate bonds were difficult to trade and near impossible to issue in mid-March 2020. Prices on some high-grade corporate debt E.T.F.s, including one of BlackRock’s, were out of whack relative to the values of the underlying assets, which is unusual.

People could still pull their money from E.T.F.s, which both the industry and several outside academics have heralded as a sign of their resiliency. But investors would have had to take a financial hit to do so, relative to the quoted value of the underlying bonds. That could have bruised the product’s reputation in the eyes of some retail savers.

fund recovery was nearly instant.

When the New York Fed retained BlackRock’s advisory arm to make the purchases, it rapidly disclosed details of those contracts to the public. The firm did the program cheaply for the government, waiving fees for exchange-traded fund buying and rebating fees from its own iShares E.T.F.s back to the New York Fed.

The Fed has explained the decision to hire the advisory side of the house in terms of practicality.

“We hired BlackRock for their expertise in these markets,” Mr. Powell has since said in defense of the rapid move. “It was done very quickly due to the urgency and need for their expertise.”

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A Glimpse of a Future With True Shareholder Democracy

In the near future, giant index funds, those low-cost investments that have helped millions of people to build nest eggs, will gain “practical power over the majority of U.S. public companies.”

That nightmarish vision originated in a prescient 2018 paper by John Coates.

Mr. Coates was a professor of Harvard Law School when he laid out his argument — one that I share. Now, he is a policymaker. In February, he became acting director of the Securities and Exchange Commission’s division of corporation finance. Under the new reform-minded S.E.C. chairman, Gary Gensler, Mr. Coates is in a position to address the problems he has analyzed so painstakingly.

Neither Mr. Coates nor Mr. Gensler was available for an interview, but in that paper, Mr. Coates laid out his views. Index funds, which simply track the market and make no attempt to outperform it, are so effective and cheap, he said, that they have become the investment vehicle of choice for trillions of dollars of assets. Yet under current rules, it is the index fund executives, not the millions of people who invest in them, who have the power to cast proxy votes.

Those votes are the heart of a system intended to give investors a voice on crucial matters like how much the chief executive is paid or whether a company is damaging the environment.

wrote in December 2019, that lack of proxy voting capability leaves vast numbers of investors out of the equation, and gives corporations inordinate power. Consider that roughly half of all American households, comprising tens of millions of people, have a stake in the stock market. But most own equities indirectly through funds — mainly index funds.

That leaves fund managers with the decisive power over corporate governance, and the biggest fund companies have sided with management roughly 90 percent of the time.

As Mr. Coates wrote in 2018, “Control of most public companies — that is, the wealthiest organizations in the world, with more revenue than most states — will soon be concentrated in the hands of a dozen or fewer people.” The title of his paper was “The Problem of Twelve,” referring to the unelected leaders of index fund operations.

What’s worse, mutual fund companies are frequently conflicted. Many receive revenue from public traded corporations for providing financial services connected to retirement plans, yet have the responsibility of casting critical votes on how those companies are run. Scholars like Mr. Coates have worried about these conflicts for years.

study, “Uncovering Conflict of Interests: Proxy Voting Data Reveals Bias for Asset Managers to Favor Clients,” was done by the group As You Sow, which files for shareholder proposals on issues such as the environment, gender and racial diversity, and executive pay.

The group based its finding on an analysis of 9.6 million proxy votes by fund companies, along with Labor Department records that show how much fund companies were paid for retirement plan services.

“The big fund companies have a massive aggregation of power that comes from the investments of their shareholders,” said Andrew Behar, chief executive of As You Sow. “At the very least, the fund companies shouldn’t be allowed to vote if they have conflicts of interest.”

Such apparent conflicts are permitted under current rules, as Mr. Coates noted in his 2018 paper. There are many possible regulatory solutions, but the fundamental cure would be to take proxy voting power away from the fund companies and put it in the hands of millions of fund shareholders. That change would be especially important for investors in broad-based index funds, which mirror the stock market and cannot divest shares of individual companies.

Say you don’t want to put money into Exxon Mobil because you disagree with its approach to climate change. If you own shares in an S&P 500 index fund, you will have an indirect stake in Exxon nonetheless. And if you hold the fund in a workplace retirement account, you may be stuck. Only 3 percent of 401(k) plans include investment options based on what are known in the industry as environmental, social and governance (E.S.G.) principles, according to the research firm Morningstar, a research firm that rates funds.

Reflecting widespread concern about climate change, fund companies appear to be shifting some of their proxy votes, Morningstar said. BlackRock, headed by Larry Fink, has called for a speedy transition to a “net zero economy” and Vanguard in April adopted guidelines that may lead to more “E.S.G.-friendly” votes, said Jackie Cook, director of investment stewardship research at Morningstar.

INDEX, has taken a small step that could have revolutionary implications: This year, it has begun asking shareholders how they want to vote.

Index Proxy Polling,” an easy way for shareholders to convey their preferences on proxy votes for S&P 500 companies. The aim is to demonstrate how shareholders in an index fund could express their opinions.

So far, only about 100 investors have participated, said Mike Willis, the fund manager, and current S.E.C. regulations require him to make the final voting decisions on behalf of the fund. But he said he hoped the S.E.C. would eventually allow him “to move to real shareholder democracy and go to pass-through voting, in which the shareholders say what they want and we just cast the vote for them.”

I commend Mr. Willis for his innovative approach, but note that this is not a typical index fund. It is an equal-weighted version of the S&P 500: It gives equal emphasis to big and small companies, so it may underperform the market when giants like Apple boom, and do better than the standard index when smaller companies excel. Its expense ratio of 0.25 percent is reasonable but not as low as some of the giant funds.

If experiments like this catch on, they could help to move the markets closer to something resembling shareholder democracy. But legislators and regulators — people like Mr. Coates and Mr. Gensler — will need to weigh in, too, if we are to avert a future in which the voices of investors are muffled and giant corporations are dominated by even more powerful index funds.

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China’s Biggest ‘Bad Bank’ Tests Beijing’s Resolve on Financial Reform

HONG KONG — BlackRock gave it money. So did Goldman Sachs.

Foreign investors had good reason to trust Huarong, the sprawling Chinese financial conglomerate. Even as its executives showed a perilous appetite for risky borrowing and lending, the investors believed they could depend on Beijing to bail out the state-owned company if things ever got too dicey. That’s what China had always done.

Now some of those same foreign investors may need to think twice. Huarong is more than $40 billion in debt to foreign and domestic investors and shows signs of stumbling. The Chinese government, which has stayed quiet about a rescue, is in the early stages of planning a reorganization that will require foreign and Chinese bondholders alike to accept significant losses on their investments, according to two people familiar with the government’s plans.

Beijing has spent decades bailing out Chinese companies that got in over their heads, but in recent years has vowed to turn off the tap. While regulators have promised to make an example out of financial institutions that gorged on loans and waited for the government to foot the bill, Huarong is testing the limits of that resolve.

Unlike the handful of small banks and state-owned companies that have been allowed to fall apart, Huarong is a central part of China’s financial system and, some say, “too big to fail.” Its vulnerable status has left China’s leaders with a difficult choice: let it default and pierce investor faith in the government as a lender of last resort, or bail it out and undermine efforts to tame the ballooning debt threatening the wider economy.

highly unusual punishment that experts said was meant to send a message.

Mr. Lai confessed to accepting $277 million in bribes, telling state television that he had kept $30 million cash in safes around his apartment in Beijing, which he referred to as his “supermarket.”

Chinese regulators fear the corruption shown by Mr. Lai has become so embedded in Huarong’s business practice that assessing the full extent of its losses and the collateral damage from a possible default is a challenge.

“The scale and amount of money involved in Lai Xiaomin’s case is shocking,” said Li Xinran, a regulator at the Central Commission for Discipline Inspection. “This shows that the current situation of the fight against corruption in the financial sector is still serious and complex. The task of preventing and resolving financial risks is still very difficult.”

said that it would delay publishing its annual results in March. It delayed its annual results a second time last month, raising worries about the state of its financial health and its ability to repay investors.

Any situation where Huarong is unable to repay in full its investors would ripple through some of the world’s biggest and most high profile investment firms. As the international financial market grappled with that scenario, the bonds recently went into a tailspin.

This year alone, Huarong owes $3.4 billion to foreign investors. After it delayed releasing its annual results, the bonds sold for as little as 60 cents for every dollar. In Hong Kong, its stock was suspended.

It is already very late for a big corporate reorganization, said Larry Hu, head of the China economics desk at Macquarie Group. “Huarong has already become too big to fail,” he said. “It is no longer a fix to the problem, but the problem itself.”

The government’s latest plan, which has not yet been reported, is likely to roil China’s corporate market. Last month, the broader market for Chinese companies started to wobble as anxious investors began to consider a possible contagion effect.

Chinese companies owe nearly $500 billion in loans to foreign investors. A Huarong default could lead some international bondholders to sell their bonds in Chinese state-owned enterprises, and make it more difficult for Chinese companies to borrow from foreign investors, a critical source of funding.

Concerns about the company’s ability to raise fresh money prompted two ratings agency to put Huarong on a “watch” notice — a type of warning that means its debt could be downgraded, a move that would make its ability to borrow even more costly.

“There is no playbook for this,” said Logan Wright, director of China research at Rhodium Group, a consulting firm. China’s regulators are now faced with the challenge of following through with a promise to clean up the financial system while also preventing a possible meltdown, he said.

“You’re pitting Beijing’s new rhetoric that they are cracking down against the assumption that they will ensure the stability of the system,” he said.

The government is likely to inject some money into whatever reorganized company eventually emerges from Huarong’s difficulties, but it is not prepared to inject enough money to pay off all of the bonds, the two people familiar with the government’s plans said.

Even as the government crafts a plan to downsize Huarong, the company has sought to calm investors’ nerves, promising that it can pay its bills. Speaking to state media, Xu Yongli, vice president of Huarong, likened his firm to other critically important Chinese financial institutions.

“The government support received by Huarong is no different,” he said.

Alexandra Stevenson and Cao Li reported from Hong Kong and Keith Bradsher reported from Beijing.

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‘We Were Left With Nothing.’ Argentina’s Misery Deepens in the Pandemic.

Before the pandemic, Carla Huanca and her family were making modest but meaningful improvements to their cramped apartment in the slums of Buenos Aires.

She was working as a hairstylist. Her partner was tending bar at a nightclub. Together, they were bringing home about 25,000 pesos ($270) a week — enough to add a second story to their home, creating extra space for their three boys. They were about to plaster the walls.

“Then, everything closed,” said Ms. Huanca, 33. “We were left with nothing.”

Amid the lockdown, the family needed emergency handouts from the Argentine government to keep food on the table. They resigned themselves to rough walls. They shelled out for wireless internet service to allow their children to manage remote learning.

“We have spent all of our savings,” Ms. Huanca said.

The global economic devastation that has accompanied Covid-19 has been especially stark in Argentina, a country that entered the pandemic deep in crisis. Its economy shrank by nearly 10 percent in 2020, marking the third straight year of recession.

wealth taxes to finance the costs of the pandemic — a measure that Argentina adopted late last year.

The fund’s analysis of Argentina’s debt picture, and its conclusion that the burden was not sustainable, set the groundwork for a settlement with international creditors last year. Investors ultimately agreed to write down the value of some $66 billion in bonds, overcoming the opposition of the world’s largest asset manager, BlackRock.

The Argentine government is proceeding on the assumption that it can secure a deal from the fund that will allow the country to significantly postpone its debts, providing relief from looming payments — $3.8 billion this year, and more than $18 billion next year — without strict requirements that it cut spending.

“The I.M.F. leadership has made clear that this is the framework,” said Joseph E. Stiglitz, a Nobel laureate economist at Columbia University in New York. The new arrangement will reflect “the new I.M.F.,” he added, “recognizing that austerity doesn’t work, and recognizing their concerns about poverty.”

antagonized the poor with cuts to government programs. His debt binge combined with another recession forced the country to submit to the ultimate humiliation — asking the I.M.F. for a hand.

In elections two years ago, voters rejected Mr. Macri and installed Mr. Fernandez — a Peronist. Some suggested that Mr. Fernandez might stake out an acrimonious position with creditors, including the I.M.F. But the Fernandez administration has proved pragmatic, winning the confidence of the I.M.F., while maintaining relief for the poor.

“We have to avoid following the patterns of the past that did so much damage,” the economy minister, Mr. Guzmán, said in an interview. “We want to be constructive, and resolve these problems in a way that works.”

The most pernicious problem remains inflation, a reality that assails businesses and households, adding to the strain on the poor through higher food prices.

In major economies like the United States, central banks conventionally respond to inflation by lifting interest rates. But that snuffs out economic growth — not a tenable proposition in Argentina, where the central bank already maintains interest rates at the stultifying level of 38 percent.

Brazil. Her partner’s employer reduced his hours, cutting his pay in half.

“I’m scared about what could happen now,” she said. “Everyone is very worried.”

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Delta and Coca-Cola Reverse Course on Georgia Voting Law, Stating ‘Crystal Clear’ Opposition

In the memo, Mr. Bastian said it was only after the law was passed that he truly understood the degree to which it would impose restrictions on Black voters.

“After having time to now fully understand all that is in the bill, coupled with discussions with leaders and employees in the Black community, it’s evident that the bill includes provisions that will make it harder for many underrepresented voters, particularly Black voters, to exercise their constitutional right to elect their representatives,” he said. “That is wrong.”

Mr. Bastian went further, saying the new law was based on false pretenses.

“The entire rationale for this bill was based on a lie: that there was widespread voter fraud in Georgia in the 2020 elections,” he said. “This is simply not true. Unfortunately, that excuse is being used in states across the nation that are attempting to pass similar legislation to restrict voting rights.”

Several other companies also weighed in on the issue on Wednesday.

Larry Fink, the chief executive of BlackRock, issued a statement on LinkedIn saying the company was concerned about the wave of new restrictive voting laws. “BlackRock is concerned about efforts that could limit access to the ballot for anyone,” Mr. Fink said. “Voting should be easy and accessible for ALL eligible voters.”

Mark Mason, the chief financial officer of Citi, in a post on LinkedIn, called out the Georgia law as discriminatory.

“I am appalled by the recent voter suppression laws passed in the state of Georgia,” said Mr. Mason, who is Black. “I see it as a disgrace that our country’s efforts to keep Black Americans from engaging fully in our Constitutional right to vote continue to this day.”

Chuck Robbins, who is the chief executive of Cisco and grew up in Georgia, said on Twitter that “voting is a fundamental right in our democracy” and that “governments should be working to make it easier to vote, not harder.”

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WeWork Will Go Public in a Merger With a SPAC

After a failed initial public offering and the near implosion of its business in 2019, WeWork said Friday that it had agreed to a deal that would take the beleaguered co-working company onto the stock market.

Instead of a traditional I.P.O., WeWork is merging with BowX Acquisition, a special purpose acquisition company, in a type of deal that has become hugely popular in recent months.

BowX is backed by Bow Capital, an investment firm that counts the National Basketball Association star Shaquille O’Neal as an adviser.

WeWork leases office space and then effectively sublets it to its members, which include individuals, start-ups and large corporations. Its heady expansion was fueled by SoftBank, the Japanese conglomerate that became WeWork’s largest shareholder and rescued the company in 2019 just as it was about to run out of cash.

nearly $50 billion value that its investors placed on the company in 2019. WeWork will receive $1.3 billion in cash from the deal, including $800 million from Insight Partners, Starwood Capital Group, BlackRock and other investors.

The pandemic emptied WeWork’s offices, and it is not clear how much demand there will be for its office space in the future. Many people have become used to working from home and some large employers like Target and Dropbox have said they plan to give up big chunks of their office space because they expect fewer employees to come in daily. Other businesses like the retailer R.E.I. sold its headquarters all together. WeWork said Friday that memberships fell to 476,000 last year, from 619,000 in 2019.

Still, BowX’s chief executive, Vivek Ranadivé, told CNBC in an interview Friday that the pandemic would be a “tailwind” for the office-sharing company.

“Companies have now decided that flex space is the must-have,” said Mr. Ranadivé, a technology entrepreneur who owns the Sacramento Kings basketball team. “Maybe for their own headquarters they want to own that space. But for everything else, they want to hand it over to a WeWork.”

WeWork said it had lowered its costs since its failed public offering. The company is expecting revenue to surge in the coming years. It also offered a bullish forecast of earnings before interest, taxes, depreciation and amortization, an often flattering measurement of cash flows, but did not say what its profit might be. In the past, it has struggled to meet lofty projections. And it must try to draw tenants at a time when the office markets in New York, London, San Francisco and other big cities are awash with cheap sublet space.

Adam Neumann, a co-founder of WeWork, and SoftBank settled a legal dispute. WeWork had called off its I.P.O. in 2019 after investors balked at its losses and criticized its governance practices.

SoftBank has been eager to take WeWork public via a special purpose acquisition company, or SPAC, a route to Wall Street that has become increasingly popular in recent months because it is faster than a conventional public offering. As of Wednesday, 295 SPACs had gone public in 2021, raising $93 billion and breaking last year’s record in a matter of months.

SoftBank poured billions of dollars into WeWork after Masayoshi Son, SoftBank’s chief executive, bought into Mr. Neumann’s ambitious vision, which included building schools and serviced apartments in addition to leasing office space. In total, SoftBank has backed WeWork to the tune of nearly $16 billion, counting investments in the company, loans and payments to existing shareholders. After WeWork goes public, SoftBank will be able to sell its stake or keep it in the hope that it goes up in value.

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Goldman Sachs Partners’ Exits Point to a Changing Culture at the Bank

Late in March, Gregg Lemkau, the longtime co-head of investment banking and an executive who was widely considered a potential Goldman C.E.O., sent a Twitter post about getting up during the wee hours to work remotely from his home in Hawaii, which is six hours behind New York.

He soon got a call from Mr. Solomon, who was not pleased with the perception of the message, say three people with knowledge of the call. The two executives argued, those people said, over whether Mr. Lemkau should return to New York. They settled their differences and Mr. Lemkau stayed put for two months before flying back. In mid-November, Mr. Lemkau, then 51, announced plans to retire from Goldman to become chief executive of the family investment office of Michael Dell, the billionaire founder of the computer company.

“The reaction was overwhelming,” said Mr. Lemkau in a podcast weeks later. The memories colleagues shared, he said, underscored how his treatment of other people had defined him. “Not the big deals I did, not anything formal I did, but the little things that you did that made a difference in their lives,” he reflected, “it sort of makes you feel like, ‘Damn, I’m glad it was worth doing all that stuff.’”

Mr. Lemkau has told people privately that his departure had nothing to do with his tiff with Mr. Solomon.

The exodus picked up steam this year. Last month, Michael Daffey, who had led the global markets division, retired.

Then, this week, Eric S. Lane, co-head of the firm’s asset-management business and also viewed as a contender for the Goldman C.E.O. role, took a senior role at a large hedge fund. Karen Patton Seymour, the firm’s general counsel since 2019, also left, and plans to return to her former law firm, according to internal emails. All were members of the management committee, and all but Ms. Seymour had long tenures at the firm. Around the same time, Omer Ismail, head of Goldman’s Marcus consumer business, left to run a new financial-technology venture that has been seeded by Walmart, taking a deputy who had overseen the firm’s Apple credit card partnership along with him.

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