Plus: tax cuts galore! May 20, 2025 Sign Up | View online IN THIS ISSUE 8 min read ✂️ Tax cuts 🤖 Slop farms 👔 Trading floors The perfect living room has … three washer/dryers and a sink? Weird home decor inspo is filling Facebook feeds thanks to the work of “sloperators.” We explain below. | Facebook THE WEEK IN MARKETS Stocks spring to life April showers, May flowers, et cetera — there’s a reason people have been repeating that saying for something like six centuries. Last week, the markets continued their post-Liberation Day rebound, with the TSX finishing Friday up 5% on the year. Even the S&P 500, which got rocked harder during the April storms, climbed back into the green for 2025 and is within spitting distance of its pre-Lib Day record high. Investors have been buoyed by the U.S.-China trade détente going from rumor to reality, with more truces — from Canada to India — seeming imminent. As Bloomberg’s Joe Weisenthal tidily put it, tariffs are much higher than they were on April 1, but uncertainty is also much lower. Meanwhile, Republicans in Congress are charging ahead with jumbo tax cuts, which could juice markets further. Investors are suddenly so bullish that a few major Wall Street strategists (Goldman’s David Kostin, Morgan Stanley’s Mike Wilson) just upwardly revised their stock performance expectations. The surest sign of a genuine shift: the nail-biters are already back to worrying whether stocks are overpriced. THE WEEK IN ONE CHART WHAT HAPPENED LAST WEEK IMPORTANT Honda’s project pause delivers another blow to Ontario. A new EV plant would have created an additional 1,000 jobs for the 23,000-person town of Alliston, Ontario. But Honda has put a two-year freeze on the $15 billion project — an early example of how Trump’s trade tiff, despite recent de-escalations, has put a chill on manufacturing. It’s also a reminder that the tariff pain won’t be spread evenly across Canada. Manufacturing jobs (most of which are in Ontario) dropped in April for the third straight month, and the province’s unemployment rate is now higher than it is in Alberta, New Brunswick, or PEI, and it’s nearly twice as high as Saskatchewan’s. Carney aims to deliver on his income-tax promise. Prime Minister Mark Carney, like nearly every other candidate in the latest election, campaigned on a promise to cut income taxes, and that’s exactly what (he says) he’ll do first when parliament resumes on May 26. Once that legislation is passed, taxes on the lowest income bracket will drop from 15% to 14% next year. (It’ll be 14.5% this year because the change is occurring halfway through 2025.) If your annual pre-tax income is between $50,000 and $129,000, for instance, you’ll save between $230 and $316 a year. It’d be nice to move that fast on housing, too, but first Carney’s government needs to agree on whether it wants home prices to go up or down. INTERESTING An AI slop farmer spills the beans. Slop farming is when someone uses AI to create fake content to monetize views and clicks — e.g., Pinterest recipes or this Facebook home-decor page showcasing rooms with three washing machines. Futurism dug into one top “sloperator” and his methods, which he alleges generate more than $12,000 a month. He targets fandom groups and seniors, then churns out fake AI-generated content at 100x the volume of a human creator. Futurism couldn’t verify the farmer’s earnings, but AI slop is now so widespread that more than half of all English-language posts on LinkedIn are likely AI-generated, and Pinterest is scrambling to roll out tools that’ll enable users to filter out generative-AI content. Airbnb wants to be your passport to the world. We mean that super literally: in a gonzo new Wired profile, Airbnb CEO Brian Chesky shares the story of a recent vision-quest-y Thanksgiving when he realized he needed to reinvent Airbnb to do … pretty much everything — rent a château, book a spa day, even function as a legitimate form of government-issued personal ID. It’d be Instacart + Ticketmaster + Facebook + Yelp + Service Canada’s passport office, all in one app. Airbnb has lost some of its shine of late, but Chesky’s ambitious app updates just launched last week, and $ABNB jumped by 10%. —Sarah Rieger FROM OUR SPONSOR THE FOMO INDEX by Stacey Woods IMPORTANT 📚 Online learning platform Chegg is laying off 22% of its workers because of AI. Students prefer state-of-the-art cheating over early-aughts cheating. Source 💰 Costco limits gold bar purchases to one per customer. Amazon will deliver more, but then you don’t get the hot dog. Source 🇨🇦 Canadian Tire announced it will acquire Hudson Bay’s brands and logos for $30M. Put us down for a set of striped Pirellis. Source 📺 Max is changing its name back to HBO Max. Also going to take out its nose ring and dye its hair back to brown. Source CRASH & BURN TO THE MOON 🌬️ Wind farms accused of stealing each other’s wind. Police say it’s a difficult case because you can’t really dust for air. Source 😮 Are you a loudmouth who’s completely unnecessary? Amherstburg is looking for a new Town Crier. Source 🌭 Kraft Heinz is spending US$3B to update its plants. Could be the biggest advance in ketchup technology since hitting the side of the bottle. Source 🌌 Woman wins £29K lawsuit for being called “Darth Vader” at work. Now she’s going around telling everyone she’s their father. Source WHO CARES THE BIG IMPORTANT STORY TRADING What Exactly Is a Stock Exchange in 2025 Anyway? Week in and week out in this newsletter, we mention the performance of the TSX, an index of Canadian stocks listed on the Toronto Stock Exchange. Billions of dollars flow through the major global stock exchanges each trading day. And yet one thing that seldom crosses our minds (or yours, probably) is how these exchanges actually work. John McKenzie, the CEO of TMX Group, which runs the Toronto Stock Exchange, pulled back the curtain for us and discussed some trends among Canadian companies trying to attract investment. When most people hear “stock exchange,” they think of an old grand building downtown. But stock exchanges are actually for-profit companies. How does that work, exactly? It used to be more about transactions — you take a piece of the trading — and about listing new companies. But over time, we’ve really transitioned to be much more of a data and information company. Almost half of our business now is data and information. Another misconception people have about the stock exchange is that it’s like a 1980s movie with traders on phones, screaming at each other, but the TSX doesn’t even have a trading floor, right? I love this question, because when I started work at the TSX, I thought there still was a trading floor and I couldn’t find it. Toronto actually closed its floor in 1997 and was the first exchange in the world to go all electronic. Now everything runs on very high-volume, high-throughput digital systems. There’s a lot of concern over the relative lack of investment in Canada, and many people are asking: Is there something wrong here? What’s your view? There is so much right with Canada, but it also has so much untapped potential. One big thing that affects companies’ ability to raise money is that Canada has had multiple increases in the tax base, which disincentivizes investing activity. That, and we have excessively burdensome regulatory regimes. Our two exchanges, the TSX and the TSX Venture, have 1,100 mining companies and around 200 energy companies, making them some of the deepest markets in the world. But over the past 10 years, the energy sector went from 400 companies to 200 or so. And the round of capital that these companies have raised to fuel growth has gone from anywhere from $20 billion a year to less than $2 billion last year. And that’s all about confidence. If investors don’t believe you can get a big project done, they won’t fund it here. Do you think companies will continue to go public and raise money in countries like Canada, or is the natural pull toward everyone raising money in the biggest markets in the world, like the U.S.? That pull is difficult. But one of the few places in the world where you can still get U.S. capital [especially big banks] to participate is Canada. There’s nowhere else in the world where companies are recognized across the border the same way with mutual recognition; there’s nowhere else in the world where the financial markets are integrated from a time-zone standpoint and from a clearing and settlement standpoint the way Canada has integrated with the U.S. Another advantage is that Canada is a hotbed of innovation, but the challenge has always been how to scale up new companies quickly, as opposed to letting them get bought out. Big banks tend not to invest in small, cutting-edge companies, so private equity and wealthy networks need to step in. But if taxes are too high, it’s too easy for these investors to go elsewhere. This interview was edited for length and clarity. OTHER VERY GOOD READS 🍁 Limits of True Patriot Love What’s next now that Canada’s dormant national pride has been awakened? | The Walrus 📚 Everyone Is Cheating Their Way Through College* Universities have no idea what to do about ChatGPT. | New York Magazine 💸 Can We Reform Capitalism? If a new economic paradigm emerges, what sort will it be? | The Guardian 🤑 A Six-Step Financial Plan for Every Canadian The basics of what to do with your money. | Wealthsimple Magazine *Article is paywalled, which, yeah, is kind of annoying. But we think good journalism is worth paying for. THE WISDOM OF SOCIAL If you’re the marketing exec who renamed Max to HBO Max (again), we want to know how much you got paid for all that hard work — our DMs are open. 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), Maude Campbell (copy editor), Sara Black McCulloch (fact checker), Mohini Tailor (lifecycle marketing manager), Eva Grace Clement Cruz (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 stock in Amazon. 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