Finimize - 🙃 Guys, it could still get worse

Hi Reader, here's what you need to know for October 12th in 3:10 minutes.

🍸 With this century’s Roaring Twenties in full swing, jazzy digital assets are on the lips of young whippersnappers and establishment stalwarts alike. So join TeamBlockchain’s Jonny Fry on Friday for Why a Digital Asset Should Be Your Next Investment, and find out how to get your portfolio jiving with the times. Get your free ticket here

Today's big stories

The IMF said the global economy could have an even tougher year ahead
Here's what you need to know if you’re investing in chip stocks – Read Now
Unemployment in the UK hit its lowest in nearly 50 years, and that's not a good thing

The World Doesn’t Feel So Good

What’s Going On Here?

The International Monetary Fund (IMF) gave a grim outlook for the global economy on Tuesday.

What Does This Mean?

The global economy’s taking a real beating these days. For one, China’s faltering housing market and unwavering commitment to its zero-Covid policy are curbing the world’s manufacturing powerhouse and second-biggest economy. And for another, fallout from war in Europe is still sending global food and energy prices through the roof. Central banks, for their part, have been raising interest rates in a bid to soften hard-hitting inflation, but that move risks scuppering economies the world over. And while the IMF believes those banks should stick to their inflation-fighting guns, it thinks things will get worse before they get better. In fact, the fund expects the global economy to grow a measly 2.7% next year, saying around a third of the world’s economies might even shrink. And when you strip out the pandemic and 2008’s financial crisis, that’s the most pessimistic forecast the IMF has published since 2001.

Why Should I Care?

Zooming in: The dollar’s dominating.
The Federal Reserve’s one central bank that’s aggressively hoisted rates recently, and that’s bolstered the US dollar. The IMF thinks that’s a massive risk for the many countries – not least those in emerging markets – that hold dollar-denominated debt, as those payments are already growing far loftier. And with more fearful investors likely to flock to safe-haven investments like US government bonds, the dollar might be poised to become even stronger.

For markets: Cheer up, boss
JPMorgan’s CEO gave an equally pessimistic global outlook this week, but it was his prediction that the S&P 500 could fall another 20% that really rattled investors. But chin up guys, we’ve dealt with worse: while that drop would leave the index flagging 39% below its January high, the fall would still pale in comparison to times of the dot-com crash and the financial crisis.

You might also like: Where BlackRock sees light through all the dark clouds.

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Analyst Take

What’s Driving Semiconductor Stocks Now?

By Russell Burns, Analyst

Computer chips may be tiny, but the global stakes in this industry aren’t.

The Semiconductor Index (SOX) has fallen nearly 10% since the US announced restrictions that take aim at the speed of China’s military development.

The news, which was quickly followed by some downbeat forecasts from two major chipmakers, drives home the fact that this high-growth industry is constantly resting on a knife’s edge.

So if you’re investing in this space, you’re going to want to understand all the factors at play.

That’s today’s Insight: everything you need to know if you’re investing in chip stocks.

Read or listen to the Insight here

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