Plus: why you’re still on hold with the CRA September 2, 2025 Sign Up | View online IN THIS ISSUE 8 min read ☎️ Tax collectors 🎤 Demon hunters 🧘 Legging rejectors The next available CRA agent will not see you now, or anytime soon. | A24 THE WEEK IN MARKETS Out-of-office reply season is officially over. Sure was awfully quiet out there … too quiet … Late-August doldrums are a summer tradition for the global markets, and, per usual, trading volume was down 20% from recent months as the titans of finance unplugged in Santorini, East Hampton, and, um, Kelowna? (Everyone’s day-trading now!) But autumn is equally famous for its choppy conditions, and here are three reasons why this one feels especially fraught — think of it like a fall preview for finance: Nvidia’s earnings continue to soar, but signs are mounting that the AI spending race cannot keep going like this forever. U.S. policy uncertainty has sent gold prices soaring and helped push the TSX ahead of the U.S. markets for the year — will that continue? Investors are now banking on big U.S. rate cuts — 25bps this month, 25bps later this year, as many as five cuts over the next 12 months. A fresh tailwind for stocks if (when?) AI fades? Or a prelude to disappointment? THE CHART OF THE WEEK WHAT HAPPENED LAST WEEK IMPORTANT Want to speak to someone at the CRA by next tax season? Get on hold now. The CBC recently reported that only 5% of callers to the Canada Revenue Agency are reaching a (human) agent, and wait times for disputes and programs like the Disability Tax Credit often last months. One reason could be that out of 10,000 jobs slashed by Ottawa last year, 68% were CRA workers, and department forecasts suggest another 7,000 jobs will be cut over the next few years. Canadian small businesses are hemorrhaging U.S. customers. Mail carriers from about 30 countries have halted deliveries to America after the government abruptly scrapped its tariff exemption on goods under $800. Canada Post has partnered with a private company to collect duties up front, but the confusion has led eBay and Etsy to stop allowing shipments through Canada Post to the U.S., which is how nearly two-thirds of small businesses here reach American customers. Unless they can find a workaround, or cover the extra $80 to $200 cost per shipment, these sellers will be cut off from an indispensable market. INTERESTING How big did Sony screw up by selling KPop Demon Hunters to Netflix? A long time ago, in a galaxy not so far away, 20th Century Fox got cold feet over a space western it’d greenlit called Star Wars, so the studio and the film’s director, George Lucas, struck a deal: he’d let them keep the US$400,000 of his own money that he’d sunk into it, in exchange for the sequel and merchandise rights. Half a century later, Sony just made a very similar mistake with KPop Demon Hunters, the (Canadian-directed!) sensation that it unloaded to Netflix for US$25 million. It’s now the platform’s most-watched movie ever, and Puck’s Matthew Belloni estimates Sony will only get a tiny cut of “what will likely become a billion-dollar franchise.” The tyranny of the yoga pant is … ending? Business of Fashion reports that Gen Z is ditching formfitting brands like Lululemon ($LULU -45% YTD) in favour of slouchier, roomier clothes by labels like Free People ($URBN +25% YTD). Leggings, once a millennial staple, have dropped from 47% of all pant sales in 2022 to just 39% in Q1 2025, according to retail intel firm Edited. Hanging on to our JNCOs for a few decades has finally paid off. —Sarah Rieger FROM OUR SPONSOR THE FOMO INDEX by Stacey Woods IMPORTANT 🤩 YouTube admits to using AI to improve your content. They just thought your cat videos would be better with some explosions. Source 🍻 Toronto Oktoberfest has been cancelled. What a shame, you worked all summer for your lederhosen bod. Source 🏔️ Drones are being used to clear trash from Mount Everest. Hang tight, corpses, you’re next. Source 🏢 City of Ottawa orders all employees back to the office five days a week. In better news, City of Ottawa gives all employees weekends off! Source CRASH & BURN TO THE MOON 🌬️ Massive dust storm destroys Burning Man’s “Orgy Dome.” Attention prudes, allergy sufferers: this year’s orgies will be open-air. Source 🚔 Dallas Police Department lowering education requirement and allowing cowboy hats to boost recruitment. Will consider lassos, footie pajamas for rookies. Source 🐝 Sting sued by the other Police. Every shirtless pec, every turtleneck, every royalty cheque, they’ve been watching him. Source 🤝 Campbell’s Soup and Pabst Blue Ribbon announce new collab. Perfect for when you want that flavourless beer-flavoured flavourless soup flavour. Source WHO CARES THE BIG IMPORTANT STORY DEPT. OF DON’T FREAK Nervous About Overheated Stocks? Let’s Revisit Four of Our Best-Ever Insights Summer is over. That was the subject line of a Bloomberg briefing last week about growing worries among investors about the performance of the major stock markets in the months ahead, owing to some of the variables we mentioned up top. RBC foresees a retreat coming this fall, and a not-small number of other institutions share the view. We don’t make predictions here at TLDR. But with so many questions swirling about stocks, we combed through all the analysis we’ve published since launching this newsletter in 2022 and found four insights that feel especially relevant right now. Think of this as our sitcom clip show, just with statistics and no gag sequences. [1] Stocks have a stellar track record. Did that intro make you wonder whether it’s time to offload some stocks and buy lower-risk assets? Diversification is smart, especially if you’re nearing retirement. But bear in mind that stocks globally have marched up and up since the early 1800s, despite all sorts of horrible world-historic stuff. In fact, across two centuries, stocks have returned an impressive 7% per year after inflation. This chart is among our favourites here at TLDR HQ: it’s from Jeremy J. Siegel’s excellent book Stocks for the Long Run, and it illustrates the primacy of stocks relative to other asset classes. [2] Most individual stocks are duds. OK, so while it’s true that stocks, broadly speaking, have relentlessly climbed, it’s also true that only a tiny number of them — about 4% — have generated nearly all meaningful returns for investors and earned more than banks pay in interest. Meaning: 96% of stocks are not worth owning. We pointed this out in our piece about how to be a lousy stock picker, but it bears repeating, and it’s why many advisors suggest diversified, low-cost index funds: they dramatically up your odds of holding the rare winners while also blunting your losses. The market’s big winners lately have been seven giant U.S. tech companies, aka the Mag 7. Whether their dominance will continue is a topic of debate. But if you’re diversified via index funds, your portfolio should, fingers crossed, grow steadily either way while also helping you weather industry-specific turmoil. [3] Even if stocks are hot, you might still want to buy. Let’s dwell on the Mag 7 for a moment longer: over the past 30 years, the price-to-earnings ratio — a gauge of a stock’s value relative to earnings — for U.S. stocks has hovered around 17. Right now, the S&P 500’s five-year forward P/E ratio is around 22, meaning stocks are perhaps a tad expensive, thanks to the Mag 7’s lofty valuations. Does that mean a correction is imminent and it’s a bad time to invest? Not necessarily! As we reported last year, the S&P 500 has traded within 5% of a record high 60% of the time over the past six decades, and it has notched a new all-time high about once every 14 trading days. Soaring stocks, in other words, are the norm. Some bull markets have lasted for decades, high P/E ratios be darned. And if you wait on the sidelines for prices to fall, you risk missing out on hefty returns. [4] But brace yourself for periodic pain. Since the 1940s, the S&P 500 has fallen into a bear market, losing at least 20% of its value, 13 times. The TSX has done it 15 times. So basically once every five years or so, stocks tumbled big. Now for the good news: U.S. stocks have historically risen by nearly 150% during bull markets and fallen just 32% during bear markets. The TSX’s performance has been similar. Point being: investors have been rewarded for not panic selling during downturns — something we’ve repeated a gazillion times over the years, but a gazillion and one can’t hurt. —Jared Sullivan OTHER VERY GOOD READS 📺 Quebec’s Fight to Save Les Simpsons The show’s been dubbed in Québécois for 35 seasons. Will there be a 36th? | CBC 📉 How “Buy Now, Pay Later” Seduced a Generation … and then trapped them in debt. | The Walrus 🇨🇦 Carney’s First 100 Days Here’s what his government has done (and not done) so far. | Globe and Mail* *Article is paywalled, which, yeah, is kind of annoying. But we think good journalism is worth paying for. THE WISDOM OF SOCIAL ChatGPT tells us that Taylor Swift is apparently an English teacher worth US$1.6 billion. THOUGHTS ON TODAY’S ISSUE? Love it Good So so This week’s newsletter contributors: Devin Gordon (writer), Stacey Woods (writer), Sarah Rieger (news writer), Ambrose Martos (fact checker), Maude Campbell (copy editor), Sara Black McCulloch (fact checker), Mohini Tailor (lifecycle marketing manager), Eva Grace Clement Cruz (lifecycle marketing associate), Setareh Sarmadi (senior editorial producer), Matthew Karasz (markets editor), Jared Sullivan (senior editor), Peter Martin (senior editor), and Devin Friedman (editor-in-chief). Disclosures: Contributors to this newsletter own shares in Google. Wealthsimple Media Inc. 80 Spadina Ave Suite 400 Toronto, ON, M5V 2J4 VIEW IN BROWSER PRIVACY POLICY UNSUBSCRIBE Managed accounts are offered by Wealthsimple Inc., a registered portfolio manager in each province and territory of Canada. Self-directed investing is offered by Wealthsimple Investments Inc. (WSII). WSII is a member of the Canadian Investment Regulatory Organization (CIRO). Customer accounts held at WSII are protected by Canadian Investor Protection Fund (CIPF) within specified limits in the event WSII becomes insolvent. A brochure describing the nature and limits of coverage is available upon request or at CIPF. 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. The content in TLDR is not investment advice, a recommendation to buy or sell assets or securities, nor any other kind of professional advice. TLDR is not a research report and should not serve as the basis for making investment decisions. Wealthsimple Media Inc. does not endorse any third-party views referenced in this content. When you invest, your money is at risk and it is possible that you may lose some or all of your investment. Past performance is not a guarantee of future results. Historical returns, hypothetical returns, expected returns and images included in this content are for illustrative purposes only. Always research before investing. © 2025 Wealthsimple Media Inc.