Mr. Carney goes to Strasbourg

Good morning. Sacré bleu! Restaurant bankruptcies are growing in France, with almost 5,000 eateries shutting down since the start of the year, up 7% from the same period last year. This is very alarming, as we were under the impression that — aside from smoking cigarettes and going on strike — going out to eat was the country’s national pastime.

Today’s reading time is 5 minutes.

Markets: Markets rebounded yesterday — with Canada’s main stock index posting its biggest daily jump in two weeks — as bond yields dropped and oil prices calmed down.

Mark Carney spoke before the European Parliament yesterday and (in between references to Goethe and Vimy Ridge) clearly expressed his vision for a new Canada-EU partnership.

What happened: In his keynote address, Carney said Canada and Europe should form “an alliance strong enough so that no one can dictate our choices” and that the country “welcomes the ambition” expressed by European Commission President Ursula von der Leyen of anointing Canada the EU’s first associate member. Further, he expressed what such an alliance should entail.

Zoom in: Carney’s alliance wishlist included: seamless digital trade, cooperation on critical minerals and liquefied natural gas, crafting joint AI safety protocols, pooling sovereign compute capacity, and, potentially, an integrated financial services market.

Why it matters: The buzzword of Carney’s speech was "sovereignty." While he never mentioned the U.S. by name, the implication was that achieving sovereignty requires weaning off dependence on our southern neighbour. While there are concerns about shifting reliance to another foreign entity, it’s clear that the EU is open to being a much friendlier partner.

Yes, but: These overtures could incur further wrath from Donald Trump, who said he’d consider Canadian associate membership a “hostile act” and would punish both Canada and Europe for it. 

What’s next: Canada is hosting a summit with the EU in Montreal at the end of next month — we shall see if any concrete policy proposals emerge from it.—QH

OpenAI discloses more shady AI behaviour. The company reported six instances of “unexpected or concerning model behavior” it had observed over the past six months and said it was introducing a new framework for tracking and investigating when models go rogue. OpenAI, along with Anthropic, has recently started calling for a slowdown in AI development. (Associated Press)

The EDC says Canada must look inward to raise export values. Export Development Canada, the federal export credit agency, released a report claiming that improving domestic processing is just as important as new trade deals or more coastal exports. Bolstering processing could result in a nearly $100 billion boost to the GDP in the next decade, per the report. (Globe and Mail)

A Stellantis strike is looking more likely. The automaker told workers that it saw “no long-term business case” at its plant in Brampton, Ontario, which hasn’t produced a vehicle since 2023, raising the odds that the ~9,000 unionized Stellantis employees could go on strike after their bargaining agreement lapses this month. Last week, Stellantis signed a memorandum with armoured vehicle maker Roshel detailing a potential sale of the plant. (Bloomberg News) 

📡 What else is on our radar: 

Canada is at a defining moment.

The choices made today on investment, productivity, and competitiveness will shape the country for decades to come. That is why Scotiabank launched the Scotia Growth Institute – a new platform that will equip business leaders and policymakers with valuable insights to help them seize opportunities and guide decisions to support long-term economic growth.

The Institute is focused on exploring the issues that matter to Canada, North America, and the global economy. Its inaugural research examines Canada’s major projects pipeline, offering a data-driven assessment of the opportunities and challenges facing the country’s growth agenda, while the new Building Canada Tracker provides an interactive view of more than $1 trillion in major projects across energy, critical minerals, infrastructure, and natural resources.

Explore the insights. Join the conversation.

Radical Ventures launches AI venture capital fund with over $1.4 billion behind it. The Toronto VC firm will use the fund to invest in Canadian AI companies with the potential to become “trillion-dollar businesses” — helping them scale up and enticing them to stay in the country. Several major pension funds and banks have backed the initiative. 

Why it matters: It’s well-known that Canadian tech companies have a nasty habit of moving elsewhere in pursuit of late-stage funding. This fund is the latest in a line of similar projects aiming to reverse that trend, including RBC’s $1.4 billion tech growth fund announced earlier this month.

That extra hour of sleep we’re all gifted every November is in danger. 

What happened: Manitoba has officially instituted permanent daylight time, eliminating twice-a-year clock changes. B.C. and Alberta both moved to axe the time changes earlier this year, while the Yukon, Saskatchewan, and the Northwest Territories have already adopted year-round times. 

Catch-up: Daylight saving time (DST) was adopted as an energy-saving measure during WWI, but with today's technology, it doesn’t make much of a difference. The real reason we’ve kept DST in place for so long is likely economic: with an extra hour of daylight after work, people are more likely to go out and spend money. 

Why it matters: Research has shown that changing our clocks twice a year can have a pretty serious impact on our health and productivity. One study found that the adjustment to daylight saving time can negatively affect worker productivity for up to two weeks.

Bottom line: With the U.S. also potentially ditching the biannual clock changes soon — and Ontario likely to follow suit if it does — DST could one day be a quirky relic that we tell our grandkids about.—LA

🌎 Hint: This island nation straddles the International Date Line, meaning it’s one of the first places on Earth where the sun rises on a new day. Its pristine coral atolls and lagoons are also renowned among divers for being some of the world’s most untouched reef ecosystems.

Have an idea where this is? Lock in your guess here.

🦈 30. Reported cases of shark attacks in Canadian waters, according to the Canadian Shark Attack Registry, only 15 of which are confirmed. It’s time to add another to the registry, which has data dating back more than three centuries, after a diver was reportedly bitten by a great white off the coast of Percé, Quebec, this week.

Congratulations to the winners of last week's cartoon caption contest and thanks to everyone who submitted!

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Look back on the week that was with The Peak’s Weekly News Quiz! 

Then, as per usual, it’s time for the mini-crossword, the daily sudoku, Codebreaker, and Who’s Who.