A wild weekend for the ChatGPT team November 20, 2023 Sign Up | View Online IN THIS ISSUE 7 min read 🥁 🥁 🔉 … we made a podcast! Nothing tests the bond between brothers quite like one firing the other for alleged corporate mutiny. See below for just how heated things are getting at the family-run investment firm Aimia. | Columbia Pictures THE WEEK IN MARKETS A HAPPY SURPRISE Usually, the best thing about Tuesdays is that they’re not Mondays. But last week, Tuesday was special: the U.S. released lower-than-expected consumer pricing data showing U.S. inflation fell to 3.2% in October. That’s half as high as last year and mighty close to the Fed’s 2% target, upping the odds that they can stop hiking rates (and even start cutting) without a recession. The mythical soft landing. Spirits and stocks soared — and stayed that way, with the TSX, S&P, and Nasdaq all ending the week up about 2.5%. It’s a big narrative shift from all the doom and gloom of last year (or even last month). It also brought U.S. stocks the highest they’ve been this year — and even closer to 2022 numbers. THE WEEK IN ONE NUMBER 1 in 10 The number of people in Toronto who currently rely on a food bank. Of those, nearly a quarter spend more than their entire income on housing. WHAT HAPPENED LAST WEEK IMPORTANT Sorry, recession fans. Soft landings are cool again. This time last year, everybody in a bow tie or fleece vest was loudly predicting a global recession. Rampant inflation would force massive rate hikes, leading to less spending and more unemployment, they said. We were doomed! But then, well, we weren’t. The hikes happened, spending stayed pretty strong, inflation collapsed, and the apocalyptic chorus abruptly changed its tune: when Goldman Sachs said there is “no need for a recession” a few weeks ago, 74% of fund managers agreed. And then came those dreamy U.S. inflation numbers to strengthen their case. It looks like the markets are pretty on board with that prediction now, so if things start turning the other way there could be some turbulence. The third quarter is looking like a big dud for Canadian companies. Sales continue to fall, and they’re bringing earnings with them (down 7% this quarter, on average). That’s a stark contrast to the States, where earnings have started to rebound (company profits jumped an average of 2.6% so far). Why the difference? We’ve got seven guesses, and they all rhyme with things like schmapple, schmamazon, or shminvidia. Canadian grocers, however, are just fine. Loblaw significantly undermined its efforts to tame price-gouging accusations by reporting a whopping 11.7% jump in profits last quarter. In an earnings call Wednesday, board chair Galen Weston Jr. largely attributed the company’s performance to increased sales at its discount chain No Frills, as higher prices force customers to look for more deals. In response, Finance Minister Chrystia Freeland called for changes to Canada’s competition law to give shoppers more options. (Walmart, Canada’s second-largest retailer and fifth-largest grocer, also had a banner Q3, but it’s somehow managed to catch less inflation-related flak.) INTERESTING OpenAI is closed to Sam Altman. The company’s very-high-profile, very successful founder and CEO was fired late Friday, following a review by the board that found he was “not consistently candid” and could no longer be trusted. People called it a coup. On Saturday Altman was reportedly in talks to return after Microsoft (OpenAI’s largest investor) pressured the board to reconsider. But by Monday morning he had been hired by Microsoft, and OpenAI had a new interim CEO who has publicly advocated a slower AI rollout. We’re gonna be glued to updates and in the meantime are hoping that “the board” is not a sentient computer kicking off the revolution. The Mittleman brothers are done being Aimia-ble. Chris and Phil Mittleman are wrestling in court for control of their Montreal-based investment firm Aimia. Phil, the CEO, claims that Chris, the CIO, was plotting a mutiny, so he fired him. Chris accuses Phil of “oppression, fraud” and “retribution,” and — we’re not kidding — not texting him enough. The spat is threatening to bring down the house: after a $530 million profit this quarter last year, Aimia recently reported a net loss of $28 million. Like the Mittleman bros, Bell hates sharing. The telecom giant is hoping to appeal a recent CRTC decision that ordered it to share access to its fibre network with competitors, including indie ISPs. Network access is widely considered one of the keys to affordable internet in Canada — there’s a lot of land to connect and not a lot of cables — and critics argue that the telecom oligopoly’s firm grasp on those networks is what’s helped keep prices so darn high. —Sarah Rieger BIG NEWS! THE FOMO INDEX by Stacey Woods IMPORTANT 😢 $100K a year no longer a living wage for family of four in Calgary unless two of them are goldfish. Source 🛻 Tesla can sue you for $50K if you resell your Cybertruck too soon. So you’ll just have to junk it. Source 🛰️ Canadian company behind ”Claire” satellite launches space’s first commercial CO2 tracker. Louder, more critical ”Karen” satellite coming soon. Source 📱 Apple plans to make texting between iPhones and Androids easier, so all future phone shaming will have to happen IRL. Source CRASH & BURN TO THE MOON 🏃 Scottish runner given one-year ban for using a car during a race. Must also explain why she came in third. Source 🐴 Cargo plane returns to JFK after horse escapes from its stall. Never should’ve flown without its emotional-support peacock. Source 📉 Trump’s Truth Social has lost $43 million since its launch. Elon wonders how it accounts for its great success. Source 🚭 Snoop Dogg says he’s going to stop smoking weed. It’s the only way to get rid of Martha Stewart. Source WHO CARES WHAT’S UP THIS WEEK Nvidia reports earnings (Tuesday). The chipmaker’s stock is up 233% for the year (you read that right). Reporter Jon Erlichman pointed out that if you’d invested $1,000 when the company IPOed in 1999, you’d have nearly $2 million today. Can the hype train keep running forever? Fresh Canadian inflation numbers (Tuesday). Forecasters have looked deep into their crystal balls and are feeling optimistic that Canada will follow the U.S. and see price growth slow down. Fingers crossed! DON'T BE A TLDR HOG 🐷 Like TLDR? The first five million people to click this link can share it with a friend for free. (You can share it with enemies too but only if you’re ready for them to love you.) THE BIG IMPORTANT STORY EXPLICATORS The Economist People Can Actually Understand Of all the names that get thrown around the TLDR team’s Slack channel each week, Kyla Scanlon’s might come up the most (second place goes to either Tiff Macklem or Taylor Swift). In the last few years, the former options trader has become social media’s go-to explainer of markets and money. Want to understand bonds? Give Kyla 90 seconds. China’s economic struggle? She’ll barely need a minute. Every take is insightful and — a first for economic experts — really easy to understand. If you can’t tell, we’re fans. That’s part of the reason we decided to create a podcast with her. To celebrate (and shamelessly promote the new podcast), we decided to ask her about what’s going on in the world of money right now. How would you describe the economic moment we’re living through? We’re living in a time of really high uncertainty, a lot of fear, and a lot of pain. After the pandemic crash (and pandemic boom) and then the market drop last year, people are still trying to figure out what it means to exist in an economy that has changed so much and so quickly. Take inflation, for example. It’s going down, but that doesn't mean that prices are going down for a lot of goods. What’s the biggest thing you think people fail to understand about the economy? I don’t even think it’s what people fail to understand. It’s what people aren’t taught. A lot of people aren’t familiar with the terminology. They don’t know that inflation slowing down is not the same thing as prices going down. (That would be deflation, and that’s bad. It leads to job loss, lower economic growth, and even more uncertainty.) Lower inflation just means prices aren’t going up as quickly. It’s a collective failure to not have this education in place for those who need it. I’m trying to help with that. You coined the finance term of the last couple years: vibecession, or when we have the vibes of a recession, if not the reality of one. What will it take to turn these bad economic vibes around? I wish I knew. It’s probably systemic change on all levels. Canada, the U.S., it’s outside my scope of knowledge. But I think there are some things we can control, like building community and caring for people. We have to solve the loneliness crisis, for one thing. And we have to do something about debt loads. We really just need to make sure that people feel happy, however that looks. And I don't know the answer to that. Listening to a great new podcast every Tuesday might help. 🙄 If our incessant reminders didn’t tip you off, we really hope you’ll check out the new TLDR podcast. And please send us a note to let us know what you think. (You can use the feedback form below.) Why are we launching a podcast? Just like this newsletter, the TLDR podcast is sponsored by Wealthsimple. The company pays our team to produce insightful journalism, but (and this part’s important) they don’t tell us what or what not to cover. They think having a well-informed public is beneficial to everyone, and we agree. OTHER VERY GOOD READS 🦕 Canadian Museum of Nature Rethinks Its Relationship With Enbridge It’s “revisiting” position on fossil-fuel money | The Narwhal 🛜 The People Who Ruined the Internet Are SEO experts to blame or is Google? | The Verge 🤑 Emergency Funds: What, Why & How Much Build your safety net | Wealthsimple THE WISDOM OF TWITTER Great, we have to redesign all the vending machines now. 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), Nikki Holmes (copy editor), Sara Black McCulloch (fact checker), Mohini Tailor (senior LifeCycle specialist), 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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