In an interview on The Breakfast Radio, Robert F. Kennedy Jr. shared his views on his 2024 presidential campaign, reparations, inflation and America’s housing crisis, among many other topics.
His comments about big business causing the housing crisis and the chances of young Americans buying affordable housing drew widespread attention.
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RFK explains how BlackRock, State Street and Vanguard own a large portion of the S&P 500 companies
They are also buying large numbers of homes in the US. RFK Jr claims they could own 60% of the single-family homes in America by 2030…. photo.twitter.com/68izrJ9ONg
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“You have three giant corporations, BlackRock, State Street and Vanguard, that collectively own each other, so it’s basically one giant corporation, but they also own 89% of the S&P 500. They own everything and they’ve now decided to buy every single-family home in America, so if they stay on track, they’ll own 60% of the single-family homes in this country by 2030. They’re literally trying to buy everything,” RFK Jr. said.
His words echo what Vivek Ramaswamy, a former presidential candidate, said. In a post on X, he stated: “BlackRock, State Street, and Vanguard represent probably the most powerful cartel in human history: they are the largest shareholders in almost every major publicly traded company (even each other).”
But are RFK Jr. and Ramaswamy right? Do these three big companies own that much of the S&P 500?
According to Business Insider, their arguments can be traced back to a 2017 academic paper titled “Hidden power of the Big Three? Passive index funds, re-concentration of corporate ownership, and new financial risk.”
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According to the researchers, BlackRock, State Street and Vanguard are the largest shareholders of 88 percent of S&P 500 companies.
In conclusion, the researchers write that since 2008, there has been a substantial shift from active to passive investment strategies. BlackRock, Vanguard and State Street now dominate this passive investment market. Together, they are the largest shareholders in 40% of all U.S. companies and 88% of the S&P 500 companies, and they serve on de facto permanent boards of directors for more than 40% of all publicly traded U.S. companies.
And what about RFK Jr.’s claims that they may own 60% of the single-family homes in America?
Although BlackRock, Vanguard and State Street have considerable influence in the financial markets and are influential investors in various sectors, their direct involvement in the purchase of single-family homes is relatively limited. For example, BlackRock stated that it does not buy individual single-family homes, but rather invests in mortgage bonds and financing for the construction of new homes to increase the supply of housing.
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There is some truth to the concern, however, as private equity firms and other large investors have been buying single-family homes, particularly during the 2008 financial crisis. These companies often buy homes in bulk, sometimes outbidding individual buyers, which can drive up prices and reduce the availability of homes for average families.
Additionally, according to a report from Redfin, investors will have purchased 26% of affordable homes in the U.S. in the latter part of 2023. This makes it harder for regular buyers, who are already struggling with low availability, rising prices and high interest rates.
As NBC News reported in 2021, homeowners are selling their homes to the highest bidders, often out-of-state investors. “They’re not selling their homes to people who want to live there.”
If he becomes president, Kennedy plans to create a federal program that would offer 3% interest mortgages, financed by tax-exempt bonds. These low-interest mortgages would be available only to individuals, not businesses.
“This will reduce mortgage payments by more than $1,000 a month on a median-priced home and allow your children to outperform BlackRock in the market,” he said.
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This article ‘They Already Own 89% of the S&P 500, and Now They’re Coming After Single-Family Homes in America,’ Warns RFK Jr. originally appeared on Benzinga.com
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