• The homelessness crisis sweeping North America and much of the world is only getting worse. Recently, we looked at one potential solution as communities grapple with this growing problem.
  • Germany is stuck in recession as cheap energy remains its greatest hurdle to regaining its status as the economic engine of Europe.
  • The “Magnificent 7” continue to lead U. S. markets higher, drawing in capital investment from around the world.
  • And, the ‘capitalist class’ is working hard in Canada as many venture capital markets remain under pressure.

Do the Homeless Have the Solution?

As homeless encampments spring up across communities nationwide, few are actually asking those without a permanent address what potential solutions could be…

In this interview, Alex meets Daniel, originally from Quebec and came to B.C. in the late 1970s.

Now in his 70s, Daniel fears being forced to move and explains that safety and freedom, not addiction or mental health, have driven him to live the life of a nomad, or what some call homeless.

He spoke about the many rules associated with living in a strata building or government-subsidized living quarters.

Qube Hedge Funds Places Short Bet on Germany

According to data compiled by Bloomberg from regulatory filings, we’ve learned that the Qube hedge fund has amassed a short bet of more than $1 billion against German companies.

Paul Marshall, co-founder of one of Europe’s largest hedge fund groups, believes the country’s energy policy has sealed its fate, stating,

“Germany has committed virtual economic suicide by giving up its energy competitiveness…”

Tech Stocks Known as the “Magnificient 7” Drive Gains

Roughly half the gains for the S&P 500 Index in 2023 came from just seven technology stocks, now known as the “Magnificent 7”. These seven companies are Apple, Microsoft, Nvidia, Amazon, Meta, Google and Tesla. The truth is that many stocks are down or flat on the S&P 500, despite the index hitting a fresh all-time high on Friday, February 2, 2024.

Two Magnificent 7 stocks, Apple and Microsoft, have market caps of nearly $3 trillion! That’s larger than the entire Canadian stock market!

Imagine just two companies being worth more than every publicly-traded Canadian oil and gas stock, gold stock, and utility stock combined.

The U.S. market, led by its outperforming tech stocks, has become the world’s preferred market. An April 2023 article titled Arab Sovereign Wealth Funds Enjoy Western Assets by Chloe Domat sums up the influence foreign nations are having on U.S. stocks,

“According to the Global SWF report, funds from Middle East have more than doubled their investments in the West, including the U.S. and Europe, to $51.6 billion in 2022 from $21.8 billion in 2021. Of the 60 megadeals—$1 billion or more—recorded last year, 26 were carried out by Middle Eastern funds.”

Wealth funds from Switzerland to Japan continue to pour capital investment into the United States. In December of 2022, the United States Is World’s Top Destination for Foreign Direct Investment, Jannick Damgaard explains,

“The United States recorded the largest increase of inward foreign direct investment of all economies in 2021. The latest release of the IMF’s Coordinated Direct Investment Survey shows the U.S. position increasing by $506 billion, or 11.3 percent, last year.”

These funds have been massively rewarded as the U.S. market has outperformed, hitting new all-time highs on Friday.

Venture Capital Investment Continues to Struggle

The mindset of many prominent financiers and VCs has changed as the bear market rolls on for startups and early-stage companies.

Likely due to the tough market, Aaron has noticed dealmakers and financiers in Canada have begun rolling up their sleeves while directly working with the entrepreneurs leading their next deal. No longer are VCs and financiers being passive with their early-stage investments…

Aaron explains the noticeable difference in sentiment for the ‘capital class’ as it relates to their work ethic compared to previous years. The lack of activity in the space has given industry veterans time to strategize, plan, and implement.

According to the CVCA, in its Q3 2023 venture capital and private equity Canadian market overview,

“The venture capital activity in Q3 slowed down significantly, with CAD $1.2B invested across 134 deals. Although this marks it as the slowest quarter in 2023 so far, when compared to Q32022, there’s a 14% increase in total deal value. On a quarter-over-quarter basis, there was a decline of 60% in investment value and 26% in deal volume.”

With 2023 Q4 data expected to be out any day now, we are not expecting a robust rebound.

From recession in Europe to soaring stock prices in the United States, the bifurcation of markets is accelerating. Canada must catch up as productivity lags and capital leaves for more robust markets. A sign of a vibrant economy is a healthy venture market… Americans are quickly becoming Canada’s most prominent venture capital investors.