📈 Judge ye not

Good morning. A Time magazine article from October quoted U.S. ambassador to Canada Pete Hoekstra saying that Canada “would be very easy to target with 500% steel tariffs, or one patriot missile aimed at Parliament Hill.” An incendiary barb… if he had actually said it. In reality, the quote was entirely fabricated and taken from satirical website The Beaverton. 

Sure, Hoekstra uses some choice language, but the fact that Time published this quote at face value — and took nearly two months to correct the error — speaks to some serious editorial incompetence. 

Today’s reading time is 6 minutes.

Markets: TK

GOVERNMENT

A bottleneck of cases in Canadian courtrooms is leading to thousands of violent crimes going untried. 

Driving the news: New Statistics Canada data shows that around 10,000 criminal cases in Canada are now being tossed out or paused every year because of a strict 30-month deadline to hold a trial, per The Globe and Mail. 

Catch-up: A 2016 Supreme Court of Canada ruling established that criminal cases in Canada need to be tried within 30 months, or they’re essentially thrown out. Under that rule, judge shortages and other trial barriers have sent the number of tossed-out cases skyrocketing — hitting a peak of 11,132 a couple of years ago. 

Why it matters: When nearly one in every 20 criminal cases is simply being tossed out without a trial, public trust in the justice system is bound to waver, especially when it comes to cases of violent crimes.  

What’s next: On Thursday, Ottawa and the governments of Ontario, Quebec, and B.C. will ask the Supreme Court to revisit its ruling that set the 30-month deadline, using a recently expired drug-trafficking case to argue the strict trial rules have become unreasonable.—LA

Carney brings Marc Miller into his cabinet. The former immigration minister has been tapped to take over as the Minister of Canadian Identity and Culture, filling in for Steven Guilbeault, who abruptly resigned last week. Guilbeault, who served as Justin Trudeau’s environment and climate change minister for four years, cited Carney’s recent oil pipeline deal with Alberta in his resignation. 

Ontario’s Algoma Steel lays off 40% of its staff. After taking a nearly $90 million hit last quarter from U.S. tariffs, Sault Ste. Marie-based Algoma Steel is planning to lay off 1,000 workers and close one of its facilities in northern Ontario. Algoma was recently given $500 million in loans from Ottawa and the Ontario government to help keep its doors open.  

OpenAI takes a stake in one of its biggest investors. Adding to the flurry of circular deals taking over the AI industry, the ChatGPT maker is taking a stake in Thrive Capital, a private equity firm that invested over $1 billion in OpenAI late last year. Major players like Nvidia and OpenAI have faced criticism over circular deals like this, which some see as evidence of a financial AI bubble. 

Barrick plans for IPO of North American mines. The Toronto-based miner is looking to spin its North American mines into a separate company after facing pressure from activist investors. Because of its presence in regions that are deemed risky — like Africa, the Middle East, and Papua New Guinea — Barrick’s share price has largely underperformed its peers (it certainly doesn’t help when your managers are getting jailed in Mali). 

Big Short’s Michael Burry has found a new target. Already betting against the entire AI industry, Burry is now taking aim at Tesla, calling the company “ridiculously overvalued”. Tesla is trading at around 209 times its earnings (the S&P 500 average is around 22).

GOVERNMENT

After a period of flirtation, Canada and Europe are making their defence relationship official.

What happened: Canada and the EU have reached a deal for Canada to join the Security Action for Europe (SAFE) program, per Politico. The program is a temporary €150 billion vehicle for defence loans aimed at funding the procurement of major defence equipment.

Why it matters: The deal is an ‘I’ll scratch your back, if you scratch mine’ setup. Canadian companies will have access to bid on more defence contracts, and Ottawa will have more chances to add line items to its defence spending as it pursues NATO’s 5% of GDP target. 

Big picture: Canada and Europe continue to get closer on defence as the U.S. pulls away. Other recent developments include the extension of the Canadian Army’s NATO mission to Latvia, and serious chats with Saab about building Swedish fighter jets on Canadian soil. 

Our take: Ottawa is already struggling to outline how it will reach its lofty defence spending goals. There’s only so much it can feasibly do at home — and that’s including spending on stuff like telecoms and emergency management systems that really stretch the meaning of ‘defence.’ The feds will have to seek out more pacts like this one to get numbers up.—QH

What they’re saying: “From 2010 to 2014, nobody was paying attention to me. We weren’t making enough money to be relevant,” John Wall told the Globe and Mail. This Wall is not the retired five-time NBA All-Star, he is the recently-appointed president of Blackberry’s QNX division, who first joined QNX 32 years ago and stayed on when it was acquired in 2010. 

Why it matters: QNX has almost single-handedly revived Blackberry from the dead as it dominated the vehicle software market. Its operating systems are found in some 255 million vehicles globally with all of the world’s top ten automakers among its customers. Wall, who is about as respected as one can get in his field, is positioned to keep the good times rolling.

🍿 US$556 million. What Disney’s animated comedy Zootopia 2 made in its opening weekend at the box office, thanks to a huge rebound in the Chinese market. It’s now on pace to top $1 billion in ticket sales and become the biggest U.S. movie release of the year.

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Next up on the docket: besting today’s mini-crossword.