BlackRock sees global slowdown worsening in 2009

By Walden Siew

NEW YORK (Reuters) - BlackRock Inc's (BLK.N: Quote, Profile, Research) president (BLK.N: Quote, Profile, Research) said on Tuesday the money management firm is bracing for a "much bigger" global economic slowdown, but said financial market declines have created some of the best buying opportunities ever for fixed-income money managers.

In addition, BlackRock President Robert Kapito said that all options are open in a possible sale by Merrill Lynch & Co (MER.N: Quote, Profile, Research) of its large stake in the U.S. money management firm. Merrill had mentioned such a possibility last month.

Kapito, citing slowing growth in emerging markets and tightening pressures on the U.S. consumer, said BlackRock expects a much bigger slowdown in 2009.

"We think there's going to be a global slowdown," he said at a lunch sponsored by the Securities Industry and Financial Markets Association in New York. BlackRock is the largest publicly traded U.S. asset manager with about $1.4 trillion in assets under management.

Using a baseball reference, Kapito said the credit crisis is in the fourth inning, indicating he believes the crisis is nearly halfway over.

"Inflation is up, housing is down," he said. "The consumer is hurt. I can't think of one positive thing for the consumer here."

"BEST TIME" FOR BONDS

But amid the poor economic outlook, Kapito said there are bright spots for investors.