Plus: MicroStrategy kicks off a stock-market frenzy. November 25, 2024 Sign Up | View online IN THIS ISSUE 8 min read 🚗 Regrettable rebrand 🧀 Premium pasta ✅ Cash check-in Hey, listen, we know you probably don’t want to hear this, but, with the end of the year fast approaching, you’d be smart to review your finances before flipping the calendar to 2025. We explain below. | NBC THE WEEK IN MARKETS 2024 finally gets a frenzy We interrupt another week of the “stock market go up” story that’s marked 2024 to bring you one of the wildest, most-talked about, and (some would say) most reckless stock-market frenzies in recent memory. Cue MicroStrategy, a ’90s internet-software-company-turned-crypto-fund. What does it do? It has an enormous pile of Bitcoin and claims to have discovered a trading strategy that provides incredible yield on it at very low risk — which, to some people, sounds far too good to be true. All the same, the stock is up almost 80% in the last month and up more than 5x since January — a laser show even by combustible Bitcoin standards. Things have gotten so frothy that traders have been scooping up more MicroStrategy stock than they did GameStop at its 2021 peak. Traders have also been reaching for even more leveraged (read: risky) ways to bet on the company, like with call options (at record high) and 2x levered ETFs. Has MicroStrategy found a way to defy market gravity? Or maybe traders will soon realize they’re valuing MicroStrategy’s Bitcoin at four times the going rate of actual Bitcoin, setting up the stock for a crash. How will it shake out? All we can say for sure is that MicroStrategy is this year’s shining example of investors’ love affair with leverage. WHAT HAPPENED LAST WEEK IMPORTANT A mining giant digs for junk. With electricity demand surging, there’s growing concern that the world is running low on one very important commodity: copper. The global supply needs to grow by one million metric tons annually (aka a lot) over the next 25 years to ensure we have enough copper wire for modern life to function normally. The trouble is that copper mines don’t grow on trees, so mining conglomerate Glencore is digging somewhere new: junkyards. As The Wall Street Journal reported last week, at a 100-year-old plant in Quebec, Glencore is recycling old cars and gadgets sourced from 40 countries so it can reuse the copper inside. Some firms suspect scrapped copper will become increasingly lucrative and could meet 50% of copper demand by 2050. Still, there’s worry that EVs, smart grids, and other copper-heavy electronic products might surge in price unless more copper mines get built (which ain’t easy). INTERESTING Jaguar is now...JaGUar? The struggling century-old luxury carmaker — which sold a mere 8,300 vehicles in the U.S. last year, down from 40,000 in 2017 — debuted a brand relaunch that was roundly ridiculed online. As part of the rebrand, the company also changed its official name to “JaGUar,” to emphasize the British pronunciation, and ditched its iconic cat logo, leaving car aficionados aghast. The company expects to lose up to 85% of its current customer base thanks to the rebrand. Which is dramatic! But Jaguar, like most other European luxury automakers, is fighting for survival as EV demand swells and pricey gas-powered models diminish in popularity. So when all else fails, why not try crossing your fingers and throwing a Hail Mary? Kraft’s grip on the mac-and-cheese market is slipping. An interesting Bloomberg article looked at the waning strength of legacy brands through the prism of Kraft Dinner and the battle for mac-and-cheese market share. Sales of Kraft Heinz products were down 6% in the first half of this year, while both cheaper store-brand macaroni and Goodles, a pricier plant-based alternative, grew sales. In other words, wealthy shoppers are levelling up to fancy brands, while lower-income, inflation-weary shoppers are opting for budget alternatives. The trend has swept the entire food industry. Legacy brands, as a consequence, might have to stop relying on the legacy part and fix the brand, either by cutting prices or by introducing (just a suggestion) noodles shaped like TLDR money emojis? —Sarah Rieger FROM OUR SPONSOR THE FOMO INDEX by Stacey Woods IMPORTANT 💸 Eighty-one percent of millennials say they can’t afford a midlife crisis. Going to skip straight to cheap and cheerful senility. Source 🧑‍⚖️ U.S. judge might force Google to sell Chrome. Netscape, AOL, getting their resumes together. Source 💰 Government to temporarily waive sales tax and send people $250 cheques before election, because sending everyone a pony was a logistical nightmare. Source 🏃 An Irishman breaks record for fastest marathon in Antarctica. The Irishman keeps record for slowest movie on any continent. Source CRASH & BURN TO THE MOON 🥔 Alleged potato cartel accused of conspiring to raise prices on fries and tater tots. And Luca Brasi sleeps in the deep fryer. Source 🤳 Report: 21% of U.S. adults get their news from influencers, which explains why Americans are so afraid of avocado tariffs. Source 🥊 Subscribers sue Netflix for streaming issues during Tyson/Paul fight. Might also sue for no streaming issues during Hot Frosty. Source 🤖 Bless me, Lord, then help me write a cover letter: Swiss church has an AI Jesus hearing confession. Source WHO CARES THE BIG IMPORTANT STORY FINANCE 101 Six Simple (But Important!) Money Things To Do Before January 1st We’re heading into the final month of the year, that special time when many of us visit family, binge on holiday treats, and share our Spotify Wrapped on social media as if anyone cares that we listened to Sabrina Carpenter’s “Espresso” 334 times in a single 12-month span. Here at TLDR, we would like to suggest that you adopt a slightly less fun year-end ritual: checking on your finances! Amid all the year-end festivities, you should do at least one productive money-related activity before the calendar flips to 2025. Here’s where to start: #1. Are your savings still on track? Time to check! You have a savings goal, right? (If you don’t, consult a retirement calculator posthaste!) The end of the year is a good time to see if you invested and saved enough to stay on pace to hit your target. And if it turns out you fell behind, you should adjust your contributions to your investing accounts in 2025 to catch up. One rough rule of thumb is to save the equivalent of one year’s salary by age 30 and to save triple your salary by 40. But, again, use a retirement calculator to get a better idea. Speaking of savings… #2. Top up your TFSA And RRSP When it comes to building wealth, one of the most important things besides saving diligently is to minimize your tax burden. TFSAs and RRSPs are great for this, and it’s generally wise to max out your contributions before you invest in other types of investment accounts. That’s because whatever money you put into an RRSP essentially lowers your taxable income in the eyes of the government, while your contributions to an TFSA aren’t taxed now so you end up paying less tax on your gains later. Both make saving for retirement a lot easier. (Here’s how to decide which is best for you.) You’re allowed to contribute a maximum of 18% of your annual income, up to $31,560, into an RRSP. The TFSA limit this year is $7,000. #3. Be super sure you’re still diversified As we said last week, as a rule, you probably shouldn’t touch your investments much to avoid transaction fees and panic selling. That said, you’d be wise to make sure your portfolio isn’t overly concentrated. Stocks had a particularly phenomenal year, and they might now make up a disproportionately large share of your portfolio. You can correct this by rebalancing your portfolio — that is, selling some of your winners and buying other types of assets. What kind of other assets? Here are some general allocation models for Canadian investors based on risk tolerance. We also dive deeper into such matters in our diversification explainer. #4. Crisis-proof your life (or at least try to) One of the main things that crush otherwise fiscally responsible families are unforeseen emergency expenses. To prevent a crisis from plunging you into debt, it’s smart to keep six months’ worth of living expenses in a savings account or somewhere low risk so you can ride out whatever storm comes your way. And if you already have an emergency fund, make sure it’s large enough for your current cost of living. If you had a child this year or moved into a more-expensive home, you might need a larger emergency fund. Also: don’t forget insurance! To get a ballpark figure for how much life insurance you need, multiply your annual income by 15. Two-thirds of your gross earnings should probably do the trick with disability insurance. #5. Sorry, but you should think about taxes We’re not trying to ruin your autumnal joy, but you will one day, in the not-distant future, have to pay taxes on your 2024 income. So be conscious of that before you go buy your child a fancy new snowmobile for Christmas. If you’re looking to reduce your tax bill, you might consider doing some tax-loss harvesting — that is, selling a losing asset and applying the losses against your capital-gains taxes. #6. Help other people If you’re the giving type, now is a good time to open your wallet, especially if you give to a registered charity, through which you could get up to 49% of your donation back as a tax rebate. (Check out this handy calculator for more.) Pattie Lovett-Reid, a financial planner and ambassador for online charitable giving platform CanadaHelps, says there is no easy answer about how much to give: it all depends on your financial situation. But if you want your money to go the furthest, check out Charity Intelligence, a group that assesses charities’ results. —Brennan Doherty OTHER VERY GOOD READS 🍼 Want More Babies? Fix Parental Leave Canada’s birth rate is dropping, and cost of living is partly to blame. | Maclean’s 👟 What I Learned From Destroying Myself at the NYC Marathon* The 42-km course provides a lot of time to think. | Intelligencer 💰 A Six-Step Financial Plan for Every Human 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. POSTS OF WISDOM We’ll see if this bold move pays off… 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), Clare Douglas (copy editor), Sara Black McCulloch (fact checker), Mohini Tailor (lifecycle marketing manager), Matthew Karasz (markets editor) Jared Sullivan (senior editor), Peter Martin (senior editor), Kat Angus (managing 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 Crypto is offered by Wealthsimple Investments Inc. (WSII), a member of the Canadian Investment Regulatory Organization (CIRO). Crypto assets purchased and held in an account with Wealthsimple Crypto are not protected by the Canadian Investor Protection Fund, the Canadian Deposit Insurance Corporation or any other investor protection insurance scheme. You can learn more about the risks of crypto assets in our Crypto Product Risk Disclosure. You can find more information about WSII in our Relationship Disclosure. Any coins showcased are for illustration purposes only and are not recommendations or investment advice. No purchase required. Contest begins on November 22, 2024 at 12:01am Eastern Time (ET) and ends on December 20, 2024 at 11:59pm ET (“Contest Period”). One (1) prize available to be won in Canada, consisting of one (1) Bitcoin. 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There is no limit of entries for the referral method so long as each referral is a different individual that satisfies the account opening and funding conditions. The entrant must meet the Crypto account opening requirements to enter via the funding method. Odds of winning depend on the total number of eligible entries received during the Contest Period. Skill-testing question required. Open only to legal residents of Canada who are the age of majority in the province or territory of residence at the time of entry. The Contest is not a recommendation to trade any security or cryptocurrency. Full rules and entry details available at wsim.co/1btcgiveaway. 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. © 2024 Wealthsimple Media Inc.