Welcome to Z-Pack:.1 topic, 2 days a week, 5 minutes. Easy to consume and fast-acting⚡️

If this is your first Z-Pack, welcome - I'm Zach.

⬇️ Let’s get it.

👀 Who really runs the world?

Unless you live literally not on earth (not even under a rock counts), you would know that someone tried assassinating Trump on July 13. The guy failed, but that didn’t stop some people from screaming about how this company called BlackRock* was behind the assassination.

_{*BlackRock is an investment management company that helps people and institutions invest their money in lots of different assets like stocks and bonds to grow their wealth. Kind of similar to Vanguard}

Before I share how silly this theory is of BlackRock having the kind of Emperor-level power to do this stuff —

What the hell is BlackRock?

When you make money, it’s a good thing to (1) not spend all of it, and (2) to put some money somewhere where it can grow at a rate that’s more than inflation. Why? Because you need to accumulate money for a big thing sometimes — buying a house, car, your kids’ college, or even retirement.

In simple terms, BlackRock (and the other big one, called Vanguard) are like really big piggy banks. Instead of putting money in a bank’s low-yield savings account, people give them money to invest in lots of different things, like stocks and bonds, so they get a good return over time. These companies make money by charging a small fee to manage these investments, but they try to keep the fees low as a way to compete against the expensive fees charged by other investment vehicles, like active investors or hedge funds.

This sounds a bit complex, but it’s very good for the little guy, since it’s considered to be a cheap, safe way to invest in the stock market via an index fund.

But people get scared of these companies, like BlackRock and Vanguard, because media outlets like to talk a big game up of how they’re “buying every company,” but they miss a pretty big detail.

BlackRock and Vanguard don’t dictate what these companies, like Apple, do when they buy lots of their shares.

Some people literally think they make commands like this 👇

BlackRock only decides where to put the money of their common investors, like you and me — they can’t actually control the companies that they invest in or indexes they’re tracking.

Matt Levine, former investment banker and Bloomberg writer, explains how:

1. the asset managers don’t go around meeting with the managers of their portfolio companies to say ‘hey you should do x thing’…

2. the executives of companies, like Apple and Microsoft, for example, that BlackRock owns like 8% of just care about their own company’s profits and market share, not BlackRock’s.

   • These Apple and Microsoft executives themselves own a lot of stock in these companies, not BlackRock, so at the end of the day they’re focused on their own company’s progress.

But people, like Bernie Sanders, like to say stuff like this instead 👇

It’s ironic though, because companies like Vanguard are awesome (I think).

They’ve helped the little guy, just how Bernie wants!!

Before 1975, when Vanguard was founded, you couldn’t just buy into index funds; you had to either:

(1) just buy single stocks — meaning, individual shares of companies you thought would do well long enough to give you a return for when you sold, but this is super risky!!! As we all know, buying single stocks is generally not a safe way to build wealth long-term.

2) go through an active asset manager to buy stock — but this is super expensive (over time especially). You have to pay these middle-men some handsome fees.

But now, via Vanguard, you can pay a super low fee to participate in the stock market by investing your money into (basically) something like the S&P 500 and grow this money by ~8-10% a year (the average rate since the 70s)

Think about this — when it was founded, Vanguard terrified Wall Street so much that they were calling Vanguard communist. Why? Because Vanguard was cutting out the middle-men that made a ton of money off of big fees. Vanguard made it so where regular people, like you and me, now have the chance to play in the game, too.

Spread the Good News: BlackRock didn’t order the assassination of Trump, so ignore the crazies and invest wisely.

Still curious?

• Another good explanation by one of my favorites, Matt Levine, who has a great newsletter called Money Stuff

• Great piece on this by author and wealth manager, Barry Ritholtz

Before you go — it’d mean the world to me if you could share Z-Pack with just 1 person who you think would enjoy it too.

Please share and encourage them to subscribe - thank you 🫶 https://zpack.beehiiv.com/subscribe

Thanks for taking the Pack,

Zach

🤝 If you got this from a friend, sign up here

Disclaimer: This is not financial advice or recommendation for any investment. The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.