Finance & Economy

Global market trends and forecast with Kate Moore

September 6, 2023

Global market trends and forecast with Kate Moore

Kate Moore

Managing Director and Head of Thematic Strategy at BlackRock

Kate Moore of BlackRock discusses everything from cybersecurity and chip demand to her view on a recession.

I recently sat down to chat with Kate Moore, Managing Director and Head of Thematic Strategy at BlackRock. The last time I spoke with Kate, the 10-year was at 1.85 percent. It’s safe to say that there have been quite a few economic developments since our last conversation. That means we had a lot to cover during this interview.

The new emphasis on cybersecurity

With recent changes in legislation, cybersecurity has become an incredibly important focus area for large companies. Companies today store more sensitive data than ever, so protecting it is of utmost importance. The SEC knows the gravity of keeping this data safe, so it has bolstered its requirements for cybersecurity transparency. This, in turn, gives the cybersecurity sector a huge boost in both attention and investment from large public companies. Kate has seen this move toward cybersecurity coming for some time. It has been a key holding in her portfolio for over three years at this point, which is the longest she has ever held a position.

The CHIPS Act’s influence on the global chip shortage

It’s well-known that billions of dollars are being funneled toward the onshoring of chipmaking technologies, all thanks to the CHIPS Act. Given the recent supply chain issues the chip industry has seen, Kate predicted that companies will begin to “horde” chips as they fear a resurgence in supply chain issues. This prediction seems to have become true, as both Elon Musk of Tesla and Frank Slootman of Snowflake have publicly mentioned that their companies are purchasing as many GPUs as they can find.

As we see increased investment in the chip industry from both the US and the rest of the world, another chip shortage seems to be less and less likely. However, it’s important to remember that you can’t build a chip fabrication facility overnight, so it will likely be a few years before the labs that are being built now are up and running.

BlackRock’s view on a possible recession

Over the past couple of months, everyone has been talking about recession. Some believe that we are on the edge of a recession, whereas others believe we already experienced a recession last year. Recently, Goldman Sachs announced that it lowered the likeliness of a recession happening from 20 to 15 percent. Although BlackRock does not have the same numerical probability of a recession, much like Goldman, the organization believes there is a very low chance of a recession over the next year because GDP is still growing strong, and we are still seeing great unemployment numbers.

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