A guide to navigating that word we’re all sick of hearing March 10, 2025 Sign Up | View online IN THIS ISSUE 8 min read 🏦 Bank bluster 😮‍💨 E-cig empire 😟 Tariff talk The news is making everyone a wee bit anxious lately. We answer some questions about this uncertain economic moment below. | Pixar Animation Studios THE WEEK IN MARKETS One bad week is a blip. Two in a row could be just a minor reversal. But three straight is hard to sugarcoat. Last week the TSX and S&P were both down 3%, the NASDAQ dropped 4%, and the formerly high-flying Magnificent 7 sank more than 5%. Trump has backed off on some tariffs (for now, anyway), but investors are clearly spooked. So is it time to join the sell-off party? We can’t answer that for you! But, as we unpack below, you can always find a reason to sell, and it’s worth noting that stocks have slumped this much 30 times since March 2009. In every case the end felt nigh, and in every case you were better off buying the dip. WHAT HAPPENED LAST WEEK IMPORTANT Fact check: no, U.S. banks aren’t banned from operating in Canada. U.S. President Donald Trump keeps saying American banks are locked out of Canada and using that as an excuse to… put tariffs on oil? Canada doesn’t forbid foreign banks from setting up shop; according to the Canadian Bankers Association, 16 U.S. banks operate in Canada. But these institutions together only hold about $113 billion in assets, compared to the trillions held by Canada’s Big Five banks. That’s largely because the Canadian government strictly regulates the banking sector. Its rules, paired with the absolute chokehold our big banks currently have on the market, mean U.S. banks haven’t put much of an effort into expanding here anyway. The “rot economy” might help startups grow. So argued Ed Zitron, a prominent tech critic and Kendrick-level antagonist of Silicon Valley’s many, many Drakes, in a recent chat with TechCrunch. Zitron contends that Big Tech’s growth-at-all-costs mindset has eroded the value of popular products (Google Docs, Microsoft 365, etc.) by making them miserable to use. He called out Adobe specifically — once beloved for Photoshop and InDesign — for now having a pricey subscription model, a bloated user interface, and a terms-of-use policy that got piled on. If Big Tech doesn’t revamp, Zitron believes, they risk getting chewed up by more nimble startups. INTERESTING Meet the billionaire who smoked the e-cig market. About 80 million people worldwide smoke e-cigarettes, and nearly half are customers of just one guy: Zhang “Wayne” Shengwei. The mysterious CEO of disposable vape parent company Heaven Gifts has amassed a personal fortune worth US$2.9 billion. According to a Bloomberg profile, Zhang conquered the disposable-vape market the old-fashioned way: by paying “almost no regard to regulations.” He didn’t even attempt to get U.S. Food and Drug Administration authorization until 2022 for Elf Bar, one of Heaven Gifts’ most popular labels. And if a product ran into a regulatory issue, he’d reportedly rename it. The global e-cig market is expected to increase from US$15 billion in 2020 to US$85 billion by 2028. The U.S. recently banned Elf Bar — teens in particular love it — but more than 200 flavours remain available here in Canada. —Sarah Rieger FROM OUR SPONSOR THE FOMO INDEX by Stacey Woods IMPORTANT ☀️ Study finds that people who live in hot climates age faster. Never having to dig cars out of snow is definitely worth a shorter life. Source 🍗 Walmart apologizes for selling chicken nuggets with no chicken in them. Says they’re honestly kind of touched that anyone noticed. Source 🍦 Chinese boba and soft-serve chain surpasses McDonald’s as world’s largest fast-food franchise. See what’s possible with a working ice cream machine? Source 🐁 Biotech company seeking to re-create woolly mammoth creates woolly mouse.* *Tusks cloned separately. Source CRASH & BURN TO THE MOON 🚗 Toronto has basically stopped enforcing its no idling law. Feel free to pull over and text your friends the good news. Source 📵 Do not pass Go, do not request electronic payment of $200: Hasbro to debut new cashless Monopoly called Monopoly App Banking. Source 🦅 Photographer captures a bald eagle picking a fight with a Canada goose. World’s political cartoonists take rest of day off. Source 🍹 Kraft Heinz enters the alcohol market with Crystal Light Vodka Refreshers. Will take the guesswork out of pouring vodka into Crystal Light yourself. Source WHO CARES THE BIG IMPORTANT STORY WHIPLASH Tariffs Are Here. Maybe. No, for Real. Um, Five Questions You Might Have — Answered A quick recap: after months of threats, the U.S. levied 25% tariffs on most Canadian exports. Many of those tariffs are paused, automakers won a one-month reprieve, and energy will be subject to only a 10% tax. Still, an estimated 62% of Canadian exports are now taxed at higher rates, and Canada is fighting back (a fight that incoming Prime Minister Mark Carney says Canada will win). If you’ve been following all this, you’re probably feeling a little anxious and confused. So we did our best to answer five pressing questions during this topsy-turvy time. I just filled my Amazon cart. Are prices about to go up? If you’re buying things only made in the U.S., the price of those goods is likely to rise. But Amazon Canada is a Canadian company with its own fulfillment centres that source products globally, meaning many items don’t pass through the U.S. Where it gets complicated is that many products rely on cross-border supply chains, and if any of their components pass through America, they might get snared into the tariffs web. (For example, a laptop sold on Amazon Canada might have a Chinese battery, an American processor, and final assembly in Mexico.) Canadian-made products are less likely to get tangled, so it may be a good time to shop more locally. I was just about to buy a house (or a car). Is this a bad time to take on debt? Maybe! There are always good reasons not to do something: markets are too shaky, rates are too high, the world is too uncertain, and so on. But most of us don’t save just to watch the number go up; we do it to afford things for ourselves and our families. Some experts think tariffs could push up inflation in Canada to 7.2%, which, in turn, might trigger higher interest rates, making your mortgage more expensive. On the other hand, tariffs might push the economy into recession, which could prompt policymakers to keep rates low. Another possible complication: tariffs could make building materials more expensive. Whatever your situation is, it doesn’t hurt to build out your savings, monitor your debt-to-income ratio, and have a solid plan for managing your budget. My investment portfolio is full of U.S. stocks and ETFs. Should I dump them and buy Canadian? If your goal is to maximize returns, it’s hard to justify divesting from the market with some of the world’s largest companies. U.S. stocks have enjoyed an all-time rally since 2008, but markets have also fallen more than 20% four times during this period — so turmoil ain’t new. Anyone who sold during those dips would have missed out on historically big gains. But maybe you want to divest for political reasons, or maybe you think that the U.S. stock-market party is coming to an end. (Goldman Sachs predicts S&P returns will drop to 3% annually in the next decade.) In that case, all this global drama may be a good excuse to ensure you’re not too concentrated in a single country or sector and to diversify. (FWIW global stocks are outperforming the U.S. this year.) Am I going to lose my job? Two-million-plus Canadians work in jobs directly related to U.S. exports, so it makes sense that this is on your mind! As of early March, tariffs have started to impact business activities, with some Canadian businesses saying prolonged tariffs may lead to layoffs. But while economists are painting some grim pictures — especially in sectors like manufacturing and agriculture — remember that nobody has a crystal ball. Trump’s moves are as unpredictable as a mid-season soap opera, and negotiations are ongoing over exemptions and carve-outs. Is there going to be a recession? How should I prepare? It’s true that higher costs for businesses, reduced trade, and potential job losses could tip Canada into a recession. But that’s far from inevitable: the federal government has announced a $6 billion spending package to soften the blow, while the Bank of Canada is expected to cut rates this week. There’s always some chance of recession — but predicted downturns often outnumber actual downturns. (Anyone recall 2022’s “imminent” recession?) So instead of overhauling your financial life, the best things to do are boring: spend less than you earn, dodge debt whenever possible, and don’t bail on your investments when things get rocky. Even if tensions with the U.S. are here to stay (as Justin Trudeau has said), there are many reasons not to tremble in your boots. Canada boasts abundant natural resources, a highly educated workforce, and strong relationships with other nations. Which is a long way of saying this stretch of economic turbulence won’t be fun, but we’ll certainly ride through it — together. —Sarah Rieger and Dan Xin Huang OTHER VERY GOOD READS 🐕 Yukon’s Iconic Sled-Dog Races Face a Reckoning Freeze-thaw cycles are putting mushers and dogs at risk. | The Narwhal 👑 The Fugitive Who Crowned Himself King He retreated with his Ponzi-scheme fortune to an armed compound. | The Guardian 🩻 When I Lost My Intuition For years, he practised medicine with certainty. Then one day, he couldn’t. | Aeon THE WISDOM OF SOCIAL Ah, yes, the early 20th century, a time when the U.S. and Canada were fighting over their countries’ boundaries and polio was spreading. So different from today! 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), Dan Xin Huang (news editor), (Ambrose Martos (fact checker), Ciara Rickard (copy editor), Clare Douglas (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). Wealthsimple Media Inc. 80 Spadina Ave Suite 400 Toronto, ON, M5V 2J4 VIEW IN BROWSER PRIVACY POLICY UNSUBSCRIBE 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. 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