Plus: Burger King’s big play January 22, 2024 Sign Up | View online IN THIS ISSUE 8 min read ​​❄️ Davos drama 🍔 Burger billionaires 🥘 Swiftie scam Burger King is trying to turn itself around. We know two fast-food aficionados who are just waiting on the sidelines, ready to help. | Paramount Pictures THE WEEK IN MARKETS How far will this bull run? So stocks are up — a whole lot. The S&P 500 ended Friday up more than 20% since last January, and the Nasdaq is +35% over the same time. (The TSX, though north only 1.5% since Jan. 2023, has rallied almost 13% since October.) On a lot of investors’ minds is a familiar question: how long can this rally last? Markets have priced in, or come to assume, that interest rates will fall by more than 1% this year and that the economy will stay strong — and stocks could retreat if these rosy predictions prove wrong. (Barstool’s Dave Portnoy recently revived his 2021 stocks-always-go-up schtick, which you could argue is a markets-are-too-frothy metric.) Then again, as we pointed out last week, corporate profits have been rising fast, and history shows that some bull markets can run for decades, so maybe this one will too. We will, as always, have to wait and see. THE WEEK IN ONE NUMBER 4 trillion The number of songs streamed on music platforms last year globally, a 22% increase from 2022. WHAT HAPPENED LAST WEEK IMPORTANT The masters of the universe are feeling masterly again. Each January, billionaires, policymakers, and politicos descend on Davos, Switzerland, to rub shoulders and loudly opine about all the Big Issues as part of the World Economic Forum. This year, the business bigwigs generally agreed that the global economy is looking good, but they didn’t offer many “original or penetrating insights” into the events shaping the world, as Politico’s John Harris observed. That’s likely true because, in the internet age, the Davos crowd has just as much intel on, say, whether Houthi cargo-ship attacks will drive up inflation as anyone else with a few newspaper subscriptions. A year ago the Davos crowd wrongly predicted that 2023 would be terrible for markets, and they could be just as clueless about 2024. JPMorgan made a mountain of money. Last year was generally not terrific for U.S. banks — except for the country’s largest, JPMorgan. It recently announced that it raked in US$49.6 billion in 2023, the largest profit in U.S. banking history. How? It had a fortresslike balance sheet that helped it weather rising rates (unlike SVB); it gained US$50 billion in deposits when folks flocked to it during last year’s mini-banking crisis; and it made some savvy acquisitions. Other U.S. banks didn’t do nearly as well, partially because of bad loans and a lending slowdown thanks to high rates. We’ll see how Canadian banks do when they report late next month. INTERESTING RBI spends a whopper on Burger King. Toronto-based fast-food giant Restaurant Brands International — parent of Timmies’, Popeyes, Burger King, etc. — announced that it’s dropping US$1 billion to buy a company that operates 1,022 Burger King locations. Basically, RBI wants to control these restaurants, instead of relying on a franchisee, so that it can quickly remodel 600 locations and restore BK to its flame-grilled glory. A lot is on the line. Burger King accounts for 63% of RBI’s sales, but over the last decade or so, the chain’s performance has suffered as a result of crawling service and questionable menu options, like a Halloween Whopper that turned your poop green. Will RBI succeed in reviving BK? Tim Hortons’ sales have started to recover after a similar RBI turnaround effort, so we’ll see. Taylor Swift is seeing Red over pot ads. If you’ve been doomscrolling recently, you may have seen a video in which everyone’s favourite economy-saving pop star promises to send you Le Creuset cookware in exchange for filling out a survey. Well — shocker — it’s a scam. Tom Hanks isn’t peddling a dental plan, either, and Selena Gomez isn’t doing the thing that rhymes with corn that will get this email filtered to spam if we write it. They’re all AI deepfakes. New York magazine made the case that average folks will soon have to contend with more of this sort of thing — in the form of deepfake revenge corn, say — as AI becomes easier to use. Deepfakes could also hurt big tech companies, which already spend piles of cash (US$4 billion annually in Meta’s case) on content moderation, and might have to pay for more. TLDR PODCAST Last week, we talked about whether it might be time for an American Psycho reboot. On our next episode, out Tuesday, we ask whether 2024 is going to look more like 1948 or 1970 inflation-wise. You can listen on Apple Podcasts, Spotify, or Google Podcasts. – Brennan Doherty and Srivindhya Kolluru FROM OUR SPONSOR THE FOMO INDEX by Stacey Woods IMPORTANT 👔 Condé Nast announces Pitchfork will be rolled into GQ. Expect a lot of pretentious tie-splaining. Source 🍽️ U.S. restaurant chains Jimmy John’s and Jersey Mike’s are expanding into Canada. Better tell Timmy Horton they wanna rumble. Source 😁 Microsoft overtakes Apple as world’s most valuable company. “I’m a PC” guy points at “I’m a Mac” guy, laughs haughtily. Source 🐒 Cloned rhesus monkey lives to adulthood for the first time. Says he’s very excited, can’t wait to die for science. Source CRASH & BURN TO THE MOON 🫰 Meta offers $51 million to Canadians whose photos they used without consent. Grandma accepts, but her cat wants more. Source 🔪 Auction of “Succession” props brings in US$627,825. All proceeds will go to The Future Cold-Blooded Backstabbing Creeps Association. Source 🔮 Futurist predicts holoportation — sending holograms of yourself — will soon be common, even though Princess Leia’s been doing it for years. Source 🐾 Fossilized tracks of a 320-million-year-old animal discovered in Cape Breton, which is weird, because Paul Anka is from Ottawa. Source WHO CARES WHAT’S UP THIS WEEK Tesla and ASML report earnings (Wednesday). Tesla’s profit margins aren’t expected to look so hot, while analysts are watching ASML to gauge semiconductor demand. TELL US WHAT YOU REALLY THINK 🤔 You’ve been reading (or listening to) TLDR for a while now, so thank you! But we’re curious: what do you think of it? We’ve put together a little survey to help us learn what we could be doing better, differently, or not at all. It will only take three minutes. THE BIG IMPORTANT STORY TAX SEASON 2024 Five Tax Traps and How to Avoid Them If it seems entirely too early to begin thinking about taxes, we get it. It’s only January after all! Plus, taxes are boring! The thing is, we talked with a few tax experts who told us that if you act now you can avoid some predictable pitfalls that can cause stress and cost you money when the April 30 filing deadline rolls around. Here are a few classic ones: Trap #1: You’re not stuffing receipts into a folder Yes, you should have kept track of your receipts all year long so you’re not rushing to find them at the last minute to take advantage of every possible tax credit or deduction. But just because you haven’t saved your receipts doesn’t mean you should just keep being disorganized. If you’re not a paper-folder person, try creating a photo album on your phone where you save pictures of receipts. And you’d be wise to search your inbox for words like “invoice” or “receipt” to find deductible expenses you forgot about. Trap #2: You’re self-employed but haven’t set aside tax money If you’re self-employed and don’t set aside money to cover your tax bill, you could end up in a real jam by owing money you don’t have. The rule of thumb is to set aside at least 30% of your income for taxes, but tax calculators, which you can find online, can give you a more precise estimate. Then be a nerd: set up automatic bank withdrawals to transfer money from your primary account into a separate one you don’t touch, to reduce the temptation of spending the money. If you do end up owing money you don’t have, you can set up a payment plan with the CRA. Trap #3: You’re not maxing out your RRSP — or at least trying to So RRSPs help you save for retirement, right? Well, the other huge advantage is that whatever you contribute to one gets deducted from your annual income tax-wise. For instance, if you contributed $10,000 to an RRSP last year, the government will pretend you earned $10K less than you actually did and tax you accordingly. Which is neat. (Note: a TFSA might be a better choice than an RRSP for some folks; check out this guide.) Trap #4: You’re paying an accountant and don’t need to There are good reasons to hire an accountant to handle your return, like if you own multiple companies or do overseas business. But the majority of Canadians have straightforward returns that they should be able to easily and accurately file with online tools and thus save themselves a few hundred bucks in preparation fees. This article lists a few popular options. Trap #5: You file late or underreport your income Nearly 60% of Canadians receive a tax refund, and you don’t want to cut into yours by racking up penalties for filing late (provided you owe money) or for failing to report all your taxable income; fines for the latter run as high as 50% of the understated tax. To avoid underreporting your income, maintain a spreadsheet (or create one if you don’t have one) that lists all the money you made from your primary employer and from side hustles. T4s and similar tax forms can go MIA in the mail or never get sent in the first place, so it’s wise to keep track of your earnings. Good job! Once you’ve dodged these traps, you can put taxes out of your mind until the spring. OTHER VERY GOOD READS 🧲 How Walmart’s Financial Services Became a Fraud Magnet The company has resisted taking responsibility. | ProPublica 💰 Salary Negotiation: Make More Money, Be More Valued A classic essay on the art of asking for more. | Kalzumeus 🐦 Bill Ackman Is a Brilliant Fictional Character* Kurt Andersen close-reads a billionaire’s tweets. | The Atlantic *Article is paywalled, which, yeah, is kind of annoying. But we think good journalism is worth paying for. THE WISDOM OF TWITTER X They forgot one: “Writer of conversational Canadian financial newsletter, $1,000,000/year” (please) 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), Nikki Holmes (copy editor), Sara Black McCulloch (fact checker), Mohini Tailor (senior lifecycle specialist), Matthew Karasz (markets editor) Jared Sullivan (senior editor), Peter Martin (senior editor), Kat Angus (managing editor), and Devin Friedman (editor-in-chief). Disclosures: Contributors to this newsletter own shares in JPMorgan. Wealthsimple Media Inc. 80 Spadina Ave Suite 400 Toronto, ON, M5V 2J4 Replies to this email address are not monitored. Have questions? Visit our Help Centre or submit a request to our Client Support team. 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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.