But that doesn’t mean it’s time to panic. July 29, 2024 Sign Up | View online IN THIS ISSUE 8 min read 📦 Trade troubles ☕ Desk dodgers 🥇 Cycling costs Amos Scott Bouris is a Canadian cycling phenom. We sent a writer to Saint-Georges, Quebec, to get an inside look at what it takes for him and other Olympic hopefuls to reach the Games. Read below. | Finn O’Hara THE WEEK IN MARKETS Reality Check Well, it was bound to happen eventually. The S&P 500 tumbled 2% last week, the first drop of such magnitude since February 2023. (We discuss some of the biggest losers below.) How freaked out should investors be? On one hand, no one likes it when markets take a hit. On the other hand, 2% drops are normal. Markets average about six of them a year, and in the last 25 years, only three 2% falls turned out to be the start of a lasting downturn. Last week’s tumble merely brought U.S. stocks (the TSX finished flat) back to where they were a month ago, which is at historic highs. What’s abnormal is how long stocks ran without a fall — last week ended the longest period without a 2% hiccup since the mid-2000s. And if the past is a guide, we should probably brace ourselves for a few more down weeks this year. As to whether to freak out, only the future knows for sure, but history suggests that panicking is almost never the right move. THE WEEK IN ONE NUMBER $1.24B The amount software firm Clio just snagged during its latest funding round, a record haul for a Canadian tech startup. The B.C.-based company, which provides cloud-based subscription software for law firms, is now valued at over $4 billion. WHAT HAPPENED LAST WEEK IMPORTANT Big tech hits a big wall. What drove last week’s stock scare? The tech giants. The companies that had been rallying the most — Microsoft, Nvidia, Tesla, Google — got hit extra hard. Some less-than-great earnings from Alphabet and Tesla caused their shares to fall 5% and 12%, respectively, on Wednesday, while the others seemed to fall simply by association. As best as we can tell, tech stocks, which are responsible for about half of the S&P’s gains this year, just got a tad overheated, and the first bit of less-than-stellar news sparked a reversal. As we said up top, this sort of thing happens. We’ll likely get an idea whether the reversal will continue on Tuesday, when Microsoft reports earnings, followed by Meta on Wednesday. Wildfires are still sweeping across Western Canada. The blaze that destroyed part of Jasper, Alberta, and much of Jasper National Park last week is still raging. Over the weekend, officials put the estimated damage at 32,000 hectares, or 320 square kilometres. (The Rocky Mountain Community Relief Fund is accepting tax-deductible donations to help victims.) Insured claims from severe weather hit $3.1B in Canada in 2023, and this year isn’t looking much better. Interprovincial trade shouldn’t be this hard. Have you ever tried to order sparkling wine from British Columbia and have it shipped to, say, Quebec? If so, you probably didn’t get far, thanks to a thicket of trade restrictions. The feds have tried to knock down some of the barriers around interprovincial trade to help goods flow more easily and boost competition. But a new report found that most small businesses don’t think Canadian governments have moved fast enough to do things as simple as rolling back restrictions on selling certain foods (meat, cheese, etc.) across provincial borders or ensuring that professional licences are recognized throughout the country. Most eye-popping, the report found that nixing trade barriers could give Canada’s economy a $200 billion annual boost. In other words, Canada should probably act like one country instead of 13 small ones. INTERESTING Costco is trading like a tech stock. Deli meats and dad jeans may not be as exciting as bleeding-edge computer chips, but right now the retailer’s price-to-earnings ratio — a gauge of how expensive a stock is — is 50, which puts it in the sky-high range that’s normally reserved for growthy tech stocks, like Nvidia (67). Why are investors piling into Costco? Finance writer guy Byrne Hobart posited that more and more investors are channeling their inner Warren Buffett and falling in love with value stocks — boring but dependable, slow but steady. (Or maybe they’re just treating Costco like a meme stock.) The trouble is that value stocks stop being great values whenever everyone rushes to buy them, driving up the price. Just remember: even great companies can be a bad investment at a certain price. Office workers are just here for free coffee. More than half of employees at companies with hybrid return-to-office policies are “coffee-badging” — that is, clocking in to show their face briefly before heading home — according to a recent survey. Call it a quiet labour-market power struggle: thanks to rising unemployment, companies have regained enough leverage to force their employees back to the office a few days a week, but workers still feel confident enough in their job prospects that they’ll defy the spirit of the rules. A study from the University of Pittsburgh suggests bosses shouldn’t get too upset about that. Office mandates don’t generate profits; they just create grouchy employees. —Sarah Rieger FROM OUR SPONSOR THE FOMO INDEX by Stacey Woods IMPORTANT 🔥 Hybrid minivan owners warned by Stellantis to park away from buildings because vehicles pose a fire risk, not just an embarrassment risk. Source 💳 CrowdStrike apologizes for outage with $10 Uber Eats gift cards that reportedly don’t work. Will now just leave everyone alone. Source 📉 BoC cuts key interest rate again, bringing chances of first-time homeownership up from “totally impossible” to just “impossible.” Source 💻 OpenAI announces its new search engine, SearchGPT. Suggested first query: “What are some good names for search engines?” Source CRASH & BURN TO THE MOON 🐱 Fans outraged to learn Hello Kitty’s not a cat, but no one minds that her name is “Hello.” Source 🚨 Spicy chips send 14 Japanese students to the hospital, where they’re immediately put on lifesaving Go-Gurt drips. Source 📱 Apple likely to come out with a flippable iPhone in 2026. Rotary phones still in the concept stage. Source 🐦 Toronto aims to control pigeon population with contraception-laced bait. Hoping birds will peck out the pills on the right days. Source WHO CARES THIS WEEK ON THE PODCAST THE BIG IMPORTANT STORY LONG READ For a Shot at Olympic Gold, Amos Scott Bouris Just Needs Talent, a Little Luck, and $400,000 This week, we’re sharing an excerpt of a feature story we just published about 16-year-old Canadian youth-cycling phenom Amos Scott Bouris, who’s already on the road to the 2028 Olympic Games. As writer Kate Wagner discovered, the path to the podium is as unclear as it is costly. Read on: From around the corner, I can already hear it: the terrible soundtrack of bike racing. It’s a mix of buzzing rear-wheel hubs, chitchat, and Katy Perry’s “Teenage Dream” piped in through tinny speakers. Why every bike race has to play the worst pop hits from the worst era of pop music is beyond me, but it’s a fitting song, as the competitors are, in fact, teenagers. This gaggle of teens is here, in Saint-Georges, Quebec, for the time-trial portion of the Canadian Under-17 (U17) National Championships. A career in elite cycling begins not on the sides of the Pyrenees mountains in France or Spain but in places just like Saint-Georges, a small town an hour’s drive south of Quebec City, where the next generation of Canadian champions currently sit in folding chairs in a gravel parking lot, sandwiched between a field of wildflowers and a playground. Dozens of oversized trucks and hatchbacks are parked mirror to mirror, bikes dangling off the back. Parents stand around while a few riders fiddle with their bikes, their kits, their sunscreen, their sunglasses. They chat with each other — it’s a small world. A young guy spins the back wheel of his bike, producing a loud whirring sound prized by cyclists. “Listen to that son of a bitch,” he says to his friends. I’ve come to watch these young riders compete to get an inside look at what it takes to make the first steps toward being an Olympic-level cyclist in Canada. All the Canadian racers who are stepping up to the starting line during the Paris Games were competing in small events just like this not too many years ago. For most athletes, their gold-medal dreams will live and, most likely, die at small events like this one. Several thousand Canadian teens compete in competitive races each year, hoping to someday be among the tiny number of elite cyclists — 21 for this year’s Games — that represent Team Canada. And even the riders who reach this rarified club compete knowing that a large financial reward likely doesn’t await them. The story heats up from here. Read the full thing: For a Shot at Olympic Gold, Amos Scott Bouris Just Needs Talent, a Little Luck, and $400,000 OTHER VERY GOOD READS 👩‍🍼 Meet the Queen of the “Trad Wives” (and Her Eight Children)* A new model of womanhood — or a hammer blow for feminism? | The Sunday Times 🤑 A Budget for People Who Hate Budgeting And also want a bidet. | Wealthsimple Magazine 🩺 Why Doctors Need a Capital Gains Tax Break A physician makes the case. | Macleans 🤖 The AI job interviewer will see you now AI interview services claim they’re eliminating bias. It’s debatable. | Rest of World *Article is paywalled, which, yeah, is kind of annoying. But we think good journalism is worth paying for. POSTS OF WISDOM America doesn’t even have ketchup chips! THOUGHTS ON TODAY’S ISSUE? Love it Good So so This week’s newsletter contributors: Ben Mathis-Lilley (writer), Devin Gordon (writer), Stacey Woods (writer), Sarah Rieger (news writer), Ambrose Martos (fact checker), Ciara Rickard (copy editor), Clare Douglas (copy editor), Sara Black McCulloch (fact checker), Mohini Tailor (lifecycle marketing manager), Matthew Karasz (markets editor) Jared Sullivan (senior editor), Peter Martin (senior editor), Kat Angus (managing editor), and Devin Friedman (editor-in-chief). Wealthsimple Media Inc. 80 Spadina Ave Suite 400 Toronto, ON, M5V 2J4 Replies to this email address are not monitored. Have questions? Visit our Help Centre or submit a request to our Client Support team. VIEW IN BROWSER PRIVACY POLICY UNSUBSCRIBE TLDR is offered by Wealthsimple Media Inc. and is for informational purposes only. Any views expressed are those of the individual author and/or of Wealthsimple Media Inc., not of Wealthsimple Financial Corp or any of its other subsidiaries or affiliates. 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