Something borrowed: Canadian regulators are tightening restrictions on readvanceable mortgages over concerns that the ability to re-borrow against the paid-off value of their homes could keep customers in debt and keep cash flow issues in the dark.
If I see that ad one more time: YouTube will now let brands control how often their ads are shown to individual users to ensure we’re not seeing the same Grammarly commercials (wait, just us?) over and over and over again.
Where credit’s due: TikTok is letting users tag videos to give proper credit to the originators of viral trends—in part a response to complaints that trends (particularly those created by the platform’s Black users) catch on without due credit.
Eff you, ESG: The S&P 500 dropped Tesla from its ESG Index, citing poor working conditions and a lack of low-carbon strategy. In response, Elon Musk unleashed a Twitter rant decrying both the index itself and ESG as a concept.
The Canada Pension Plan Investment Board (CPPIB) earned 6.8% on its investments this past fiscal year but lost 2.9% in the last quarter amidst global pressure on public equities and stock market selloffs, particularly those impacting China.
Refresher: Every working Canadian contributes 5.7% of their income towards the Canada Pension Plan, which serves to replace part of your income when you retire. CPPIB manages Canada’s largest pension fund, with fingers dipped into almost every type of holding, from private debt and apartment buildings to mattress companies and golf courses.
What happened: Significant investments in China (given the country’s recent regulatory reforms and COVID lockdowns) shook the CPPIB’s annual returns, including billion-dollar stakes in companies like Alibaba and Tencent and investments in state-owned banks.
Why it matters: Since many of us contribute our earnings to CPPIB, what the fund invests in and its performance is our business. But despite recent financial pressures that have impacted the market at large, the fund boasts a 10.8% 10-year annualized rate of return with net assets standing at a robust $539 billion—so yeah, they know what they’re doing.
Canada is set to ban Chinese telecom-hardware maker Huawei from participating in the build-out of the country’s 5G infrastructure, joining several allies, including the US.
Catch up: The US, UK, and Australia have already all blocked Huawei from supplying hardware for their 5G networks over concerns that the company—which has close ties to the Chinese government—could use its equipment to pass along sensitive data to China’s intelligence services (which Huawei denies).
Big picture: The decision was not a surprise. Both President Trump and Biden have pressured Canada to keep Huawei out of 5G, and it was never likely that the government would endanger Canada’s place in the US-led Five Eyes intelligence-sharing partnership (not to be confused with Five Guys, which is just a decent spot for a burger).
Bottom line: Booting Huawei from our 5G network is just the latest chapter in the messy separation of Western economies from China, a decoupling that shows no sign of stopping amid growing political and security tensions.
As the EU works toward banning Russian energy imports (increasingly unclear what this means anymore) in response to the war in Ukraine, China is getting ready to hit the oil equivalent of a warehouse sale.
What happened: The cost of oil has hit record highs this year, but Russia’s own crude has tumbled as buyers step away to avoid tarnishing their image or getting hit by sanctions, per Bloomberg, leaving China with an opportunity to replenish its strategic reserves.
While there’s no guarantee an agreement will be reached, China has an estimated capacity to store over 1 billion barrels in commercial and strategic reserves (enough to last 70 days by some estimates) and could also be sitting on a surplus due to recent COVID lockdowns.
Why it matters: Impacts of sanctions are starting to show in Russia, with economic growth slowing and experts predicting a recession. Oil and gas account for about half of the country’s exports, so as long as there are willing buyers (including China and India), Russia may be able to keep the central piece of its economy relatively intact.
In the 61 weeks since Rogers first laid out its $26 billion proposed takeover of Shaw, we’ve learned the Canadian wireless market (led by Rogers, Telus and Bell) is so uncompetitive that the prospect of any top carrier swallowing up the fourth-largest is… complicated.
Refresher: The deal requires approval from the Competition Bureau, which is serving up a hard no as of late in the interest of protecting Canadians from “higher prices, poorer service quality and fewer choices, particularly in wireless services.”
What happened: Rogers and Shaw are pressing ahead in their search for a Freedom buyer that would satisfy the Bureau, including Xplornet and Quebecor. Despite being left out of those conversations to-date, Globalive Capital has made its bid more competitive by striking a 20-year agreement to access the Telus’ wireless network.
Why it matters: It’s unclear if Rogers is interested in entertaining Globalive’s offer, let alone whether its purchase of Shaw would be approved as a result. But if the Bureau is concerned with the harm of separating Freedom from the Shaw network, a sale that would open up access to another nationwide network could sweeten the deal.
😬 36. Percentage of millennials who cite the cost of living as their biggest concern according to a new report by Delloite, which beats out climate change and unemployment to top the list—it was also the number one concern for Gen Z.
🌎 59.1 million. Number of people globally who were forced to relocate and seek refuge within their own countries as of 2021, a record figure that will certainly increase this year due to Russia’s invasion of Ukraine.
🏠 2.5. The standard commission percentage paid by home sellers to buyer's agents and their brokerages in Toronto—a practice that is the basis for a class-action lawsuit alleging brokerages conspired to fix prices for their services.
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