Friday, May 14, 2021

This week's interesting finds

Inflation – United States

This chart shows the rolling 5-year cumulative percentage increase in the consumer price index for the United States compared to the rolling 5-year cumulative percentage increase in the broad money supply per capita: 

How to lose money when the stock market is at all-time highs  

From the bottom in late March of last year, the U.S. stock market was up nearly 75%. This was the best 12 month return ever recorded since 1950. Nearly 96% of stocks in the overall U.S. stock market showed positive returns in that time. It’s highly likely we will never experience a 12 month period of returns like that again in our lifetime. For all intents and purposes, the one year period following the bottom of the Corona Crash was the easiest environment in history to make money in the stock market. If you think this type of market is normal, you’re sorely mistaken. It’s not always going to be this easy. In fact, the stock market has already stopped being so easy in 2021 and a number of stocks are currently getting crushed. And it’s not just any stocks; it’s many of the stocks retail investors flocked to last year following the crash:

Supply chain squeeze 

Reopening is ushering in mismatches in supply and demand:

Source: Morgan Stanley 

Patterns

Humans are pattern-recognition machines. We see patterns everywhere! In fact, we’re so good at recognizing patterns that we often see them where they don’t even exist. 

This shows up frequently anywhere there are big bodies of data. And while well-intentioned, this is one of the big behavioral mistakes we make time and again in personal finance. We look for patterns. And guess what, they absolutely exist, right up until the point where you try to invest your money based on the pattern. Then *Poof!* they vanish into thin air. 

David J. Leinweber from Caltech, apparently figured out how to predict the stock market using just three variables: 

1- Butter production in the United States and Bangladesh. 

2- Sheep populations in the United States and Bangladesh. 

3- Cheese production in the United States. 

It turns out these three variables predicted 99% of the stock market’s movement! 

There’s only one problem: The joke’s on us. 

In our very human pursuit of patterns, we start seeing things that aren’t really there. We think if something happened a certain way in the past, then it will surely continue into the future. We start to believe—we desperately want to believe—that this pattern will have predictive value. 

But it doesn’t. And that’s the thing about most patterns—they don’t predict the future; they just describe the past. 

While some of these silly data mining tricks might be interesting to talk about, they don’t actually help us. 

Believe me, I’ve gone down the rabbit hole many times. For years, anytime someone approached me with this type of pattern, I would feel like I had found the Dead Sea Scrolls. But each time, the same thing happened. The pattern existed right up until it was time to invest... and then it didn’t. 

Now, when people approach me with this research—and it’s always called “research”— promising to show me a new pattern in the data, I come back to them with a magic pattern of my own. 

“It turns out,” I tell them, “that the only pattern that will influence your investing success is your behavior.” 

• Can you break the pattern of buying high and selling low? 

• Can you break the pattern of chasing after the next “big” investment? 

• And perhaps most importantly, can you buy low-cost investments in a diversified portfolio based on your values and goals and then simply ignore it?

Friday, May 7, 2021

This week's interesting finds

 Earnings, losses and relative returns 

Why interest rates are rising 

If you combine that fact with excessive US money supply growth and massive excess savings you can understand why investors feel unsettled. Without doubt, the almost absurd rise in excess savings everywhere is a result of the lockdown(s). Consumers have simply not been able to spend what they would have spent under normal circumstances, hence the big war chest building up.

The combination of those three factors – rising wage growth, rapid money supply growth and huge excess savings – can only lead to higher inflation (say the bond bears), hence the rise in bond yields. Officials at the Federal Reserve Bank don’t disagree with that but, importantly, they argue that the rise in inflation will be transitory and that inflation will begin to fade again in 2022, hence why they don’t need to act (they say). Only time can tell who is right and who is wrong. 



Healthcare

 About 44% of older millennials born between 1981 and 1988 report having been diagnosed with at least one chronic health condition, according to a recent survey. 



Canadian oil companies set self-imposed penalties if they don't meet sustainability targets  

Canadian oil sector companies are willing to pay more interest on their debts in exchange for more environmental, social and governance credit from investors. 

In a first for the North American energy industry, midstream company Gibson Energy Inc. announced a sustainability-linked credit facility. Gibson’s sustainability targets include a reduction in emissions and also an effort to boost diversity at the oil storage and pipeline company — as energy companies try to improve their credibility on the S and G components of ESG. 

Used car prices seem primed for another spike based on JDPower Auction data.


Red line indicates used car auction data pricing. The blue line indicates used car prices. Used car auction data pricing is a leading indicator of used car prices. 

Rents have started climbing meaningfully

Source: ApartmentList data

Massive spike in mentions of “inflation”.  Many of the mentions relate to rising commodity prices, but also scarcity of workers despite elevated unemployment. 

The sure-fire way to get out of debt 

Friday, April 30, 2021

This week's interesting finds

Growth-value rotation to prompt major rebalancing in ETFs 

Investors in a $15bn exchange traded fund are being warned to brace for a major rebalancing at the end of May that could see a number of major holdings removed. 

iShares MSCI USA Momentum Factor ETF is currently heavily weighted to growth stocks in the broader information technology sector, which accounts for 42% of assets. Amazon, which currently accounts for 4.6 % of the portfolio, could be removed altogether. This ETF currently has minimal exposure to traditionally value-oriented financials, at 1.5% and no energy sector holdings at all. In a sign of the market rotation, energy companies such as Occidental Petroleum and Valero Energy, which have more than doubled in value over the past six months, are likely to be added. Other stocks at risk of ejection from this ETF include Costco Wholesale, Netflix and Nike. 

CARBIOS a company pioneering new bio-industrial solutions to reinvent the lifecycle of plastic and textile polymers, and MICHELIN, a leader in sustainable mobility, have taken a major step towards developing 100% sustainable tires. Michelin has successfully tested and applied Carbios’ enzymatic recycling process for PET plastic waste, in order to create a high tenacity tire fibre that meets the tire-giant’s technical requirements. 

Crypto vs. Fiat, and why newer isn't always better

While opinions vary on Bitcoin, we have seen particularly enthusiastic endorsement emanating from the technology/software industry, including many high-profile industry figures. Some Silicon Valley companies like Square and Tesla have purchased Bitcoin at the corporate level, and Paul Graham even went as far as likening Turkey's recent crypto ban to banning the microprocessor in 1976. To these folk, Bitcoin is obviously the way of the future. This zeitgeist recently prompted someone to ask on Twitter, why are so many intelligent & capable software people so quick to embrace Bitcoin and the "future of money" with little in the way of critical thinking and only a cursory understanding of the issues?

The answer, I believe, is that these folk have - based on many decades of experience - a strong predisposition to believe that anything that is both *new* and *digital* must be superior to prior "old world" solutions. 

Instead of uncritically embracing the hype, let's take a step back and think through the issues. There are really only two potential applications/needs cryptocurrency might hope to fulfil, aside from functioning purely as instruments of speculation: 

(1) to function as a currency/means of exchange/payment, displacing/acting as a (superior) alternative to fiat currencies; and/or 

(2) to function as a "store of value". The default presumption is that - owing to putative problems/shortcoming associated with fiat currency (some true, some imagined) - Bitcoin et al are unquestionably superior - indeed a natural evolution towards next-generation solutions. 

Unfortunately, the reality is a lot more complicated than that.

How high could prices go? It's anyone's guess, because prices are driven purely by demand and supply, and demand is partly a function of price increases. However, the total amount of global wealth was estimated by Credit Suisse to be some US$360tr at 2019 year-end 1. It has probably increased since then - let's say to US$400tr. The total market cap of crypto, at some US$2.0tr, is therefore now already about 0.5% of total global wealth.

Could it go to 5%? Anything is possible. History cautions against trying to call the peak of human speculative excess - things can be taken to utterly unimaginably absurd extremes. But in the long run, I must say it is very difficult for me to imagine crypto settling out even at 2.5-5% of total global wealth levels, let alone anything higher. US$2tr in combined market cap also also represents about US$250 per global capita - including children and people from less developed countries in Africa etc. There is still room to run further in the short term - there always is - but on the long sweep of things I wouldn't be investing today with the expectation of making 100x your money. 

I used to believe Bitcoin would likely eventually go to zero. I no longer believe that. My prediction now is that we see repeated waves of speculative excess - huge giddy run ups, followed by spectacular collapses; long periods of disinterest/sideways action; and then renewed eco booms. People will always like to speculate, and the smaller the market cap gets after any bust, the less buying will be required to support and push up the price. After a bust, at some level the price will get low enough for a number of people to step up to the plate and bet on another boom that windfalls them 20x. And the cycle will repeat. It doesn't make a lot of rational sense, but then again nor does Vegas.

Friday, April 23, 2021

This week's interesting finds

Fees don’t tell the full story 

The Classic 60/40 Investing Strategy Could Now Be Working Against You

Some financial advisors and investors are wrestling with the standard portfolio known as “60/40”. For years it was a go-to for investment assets: 60% equities, 40% fixed income. A diversified basket of stocks gives you growth potential, and the bonds give you safety and ballast. 

These days, though, you don’t hear as much about this old financial rule of thumb. In fact some market observers have called the idea “no longer good enough,” “leading investors over a cliff,” or even “dead” altogether. 

Why is that? 

When bonds used to pay 6-8% and interest rates were falling, the 60/40 model worked great. But as they say, past performance is no guarantee of future results, and that is especially true with the 60/40 portfolio. The 40% (bonds) which is supposed to reduce risk is now fraught with interest-rate risk, and if interest rates rise, the bonds will go down in value. 

E&P spending in the US - It's still not coming back

Producers have historically put the brakes on capital spending when commodity prices fell, then stomped on the accelerator like a race car heading into a straightaway when prices rose. But recently unveiled 2021 budgets for many E&Ps suggest that, even with the rebound in prices, they are maintaining a conservative investment paradigm that highlights strengthening balance sheets and rewarding shareholders at the expense of rapid production growth.

Driving on U.S. Highways Tops 2019 Levels 

Here’s the latest sign of the great U.S. gasoline comeback: For the first time since the pandemic started, driving on the nation’s highways is higher than at the same time in 2019. 


US E-Commerce Penetration 

Overall US ecommerce penetration has not actually settled very far from the underlying trend line in the past year.

Tech, a big ESG overweight, isn’t all that green

Technology is one of the most over weighted sectors by ESG funds, but we find it has some of the highest indirect emissions among service industries. 

Bitcoin purchases' carbon footprint

$1 billion in Bitcoin purchases is equal to 1.2 million cars driven over the course of a year



Friday, April 16, 2021

This week's interesting finds

2021 Q1 EdgePoint commentary 

Equity Commentary : Forgetting the lessons of 2020 – 1st quarter, 2021

This quarter, investment analyst George Droulias looks at why 2020 truly was a year to forget from an investment perspective. 

Fixed Income Commentary: The negative art of investing – 1st quarter, 2021 

This quarter, portfolio manager Frank Mullen discusses how the Investment team not only uncovers undervalued investment opportunities, but also makes active choices to avoid lending to many businesses and areas of the market where others may feel comfortable doing so. 

Inflation 

More pork in the basket?


Steepest cost pressures since 2008 

Inflationary pressures have risen worldwide to the highest level in at least a decade as a surge in demand is accompanied by widespread supply constraints in the provision of goods and services. The survey data points to a steep rise in consumer price inflation across the world in coming months, most notably in the US, where prices charged for consumer goods rose sharply. 

Unprofitability and valuation 


Desperate reach for yield
 

With the fed promising not to raise rates for a few more years investors are becoming increasingly desperate for yield. That desperation has pushed High Yield credit spread to 3.22%, approaching the lowest level in the last 10 years (3.16% in October 2018).



Friday, April 9, 2021

This week's interesting finds

We're hiring! 

We're always looking for talented people who can help us achieve our goals and we understand that extraordinary human ability is a scarce resource in high demand. If you think you've got some and are interested in our company, please send your resume to: WeAreGrowing@EdgePointwealth.com.

Currently, we are looking to hire a Product Manager 

This week in charts 

Margin debt

As of late February, investors had borrowed a record $814 billion against their portfolios. That was up 49% from one year earlier, the fastest annual increase since 2007, during the frothy period before the 2008 financial crisis. Before that, the last time investor borrowings had grown so rapidly was during the dot-com bubble in 1999. 

Surprisingly Risky 

Over the past eight months, 10-year Treasury notes have shed 9.5% of their value, while 30-year bonds have dropped by 23.9%. 


The repatriation of demand by the Chinese

Annual % change in the Feds balance sheet from 2002-2021 

The earnings yield of global tech stocks is now below the 10-year Treasury yield.



Thursday, April 1, 2021

This week's interesting finds

2020 Cymbria Annual Report 

From our Cymbria Annual Report:

US purchasing managers saw prices rise at the fastest pace in a decade in March

** US MFG PMI : U.S. Manufacturing Purchasing Managers Index (PMI) 

The survey said supply chain disruptions were the main cause, and the green line below shows that supplier delivery times increased too, but the speed of the increase in input and output prices is off the charts (not literally, but getting there). 

The upturn in new business accelerated, with new export orders rising solidly. Restrictions on production, however, meant that backlogs of work were accumulated at the steepest pace since data collection began in May 2007. Although manufacturers expanded workforce numbers at a strong rate, the pace of job creation eased slightly as many firms highlighted struggles finding suitable candidates to fill vacancies. Amid substantial supplier shortages and input delays, manufacturing firms registered the fastest rise in input costs in a decade in March. At the same time, firms sought to partially pass greater input prices through to clients, with the rate of charge inflation the sharpest on record.

Reports of ongoing supply chain issues led to marked hikes in input costs across the service sector during March. The rate of input price inflation was the sharpest since data collection began in late-2009. Firms were able to partially pass higher costs through to clients, however, as selling prices rose at the fastest pace on record.

Tech Stocks vs. Bonds

Too Much, Too Soon, Too Fast 

Some things scale well. Double their size and you get double the output (or more). Other things don’t, andis it important to know which is which.

A good summary of investing history is that stocks pay a fortune in the long run but seek punitive damages when you try to be paid sooner. Virtually all investing mistakes are rooted in people looking at long-term market returns and saying, “That’s nice, but can I have it all faster?” Here’s how often the market generates a positive return based on holding period.

One way to think of this chart is that there’s a “most convenient” investing time horizon – probably something around ten years. That’s the period in which markets are nearly always to reward your patience. The more your time horizon compresses the more you rely on luck and tempt ruin.

Go down the list of investing blunders and I’m telling you, no less than 90% of them are caused by investors trying to compress this natural, “most convenient,” time horizon. 





Friday, March 26, 2021

This week's interesting finds

Your interest rate exposure is higher than you think

Treasuries bull market that began in 1981 has finally ended

 “Bull market” and “bear market” are colloquialisms, not an official thing, and they’re more associated with stocks. But the rule for investors and journalists who use the terms is usually this: A bull market ends when something falls 20% from peak to trough, and the resulting bear market is over when it rebounds 20%. The Bloomberg Barclays US Long treasury Total Return index had roared by 4,562% between September 1981 and March 2020 without ever seeing one of those 20% losses. That streak finally ended this month. 

ESG ratings

Correlation of most widely held “ESG stocks” with growth is near all time high and differential has never been wider. 


Update on QE from the Bank of Canada 

Canada’s central bank has been buying a minimum of C$4 billion in government bonds each week to keep market interest rates low to support the economy, accumulating more than C$250 billion of the securities over the past year. Since March 2020 the Bank of Canada’s bond purchases represent over 35% of the total amount of Government of Canada bonds outstanding, a rate of purchases higher than Sweden, the UK, US and Euro area Central banks. The Bank of Canada currently holds over 40% of all Government of Canada bonds outstanding! 

Central Banks around the world are in unprecedented territory, in terms of the amount of their governments’ bonds that they own. BoC Governor Tiff Macklem has said that when holdings rise above 50%, “market functioning could get distorted”. It will be interesting to see what the impacts on bond yields and markets will be when these Central Bankers begin to slow the pace of stimulus bond buying.

12% of global trade waiting on one lonely shovel

In case you’ve not already heard, a ship captain plowed his boat into the wall of the Suez Canal. They’ve been trying to dig it out for a few days now. 12% of all global exports pass through that canal, and it’s creating a bit of a log jam.



Friday, March 19, 2021

This week's interesting finds

Greensill-owned bank declared insolvent, causing losses for small German towns 

Local governments deposited money at Greenshill Bank to escape negative interest rates at their usual banks. 

A German court on Tuesday declared that a small bank tied to a collapsed U.K. finance company was insolvent, triggering losses for dozens of small German towns. 

Around Germany, at least 12 towns with a combined €200 million, equivalent to about $238 million, in deposits are in the same situation. Individual depositors are covered by insurance. 

Among them is Mengen, a tiny municipality in southwestern Germany. Like most towns that put money into the bank, Mengen was trying to avoid the small losses that come with negative interest rates.

Mengen’s mayor, Stefan Bubeck, said the town wasn’t trying to get a high interest rate, just avoid the negative rates. The town “didn’t want our deposit to decrease,” he said. Mr. Bubeck fears most of the money invested will be lost. “We are shocked.” 

The bank offered a 0.6% interest rate, compared with a minus-0.5% rate offered by other regional lenders the town used. 

Other towns have said they shifted reserves to Greensill for even lower rates to avoid the guaranteed losses of negative rates. 

Howard Marks: 2020 in Review and Positioning for 2021 

Most investors felt that the beginning of 2020 was a time of clarity: the economy and the stock market were both expected to continue advancing. While everyone knew they wouldn’t do so forever, nothing seemed poised to make them stop. And then came the strongest exogenous shock we’ve ever seen – the novel coronavirus – proving once again that we never know what’s going to happen (and that even though we can’t predict, we should prepare). Today’s environment, in contrast, seems to be characterized by a lack of clarity. Experts are expressing highly divergent opinions regarding the outlook for U.S. markets, with strong arguments both bullish and bearish. 

The biggest risk of all is the possibility of rising interest rates. Rates have declined quite steadily for the last 40 years. This has been a huge tailwind for investors, since a declining-rate environment lowers the demanded returns on assets, making for higher asset prices. The linkage between falling interest rates and rising asset valuations is a good part of the reason why P/E ratios on stocks are above average and bond yields are the lowest we’ve ever seen (which is the same as saying bond prices are the highest).

But the downtrend in rates is over (if we can believe the Fed’s assurance that it won’t take nominal rates into negative territory). Thus, while interest rates can rise from here – implying higher demanded returns on everything and thus lower asset prices – they can’t decline. This creates a negatively asymmetrical proposition. 

So today’s high asset prices may be justified at today’s interest rates, but that’s clearly a source of vulnerability if rates were to rise. (Note that today’s 1.40% yield on the 10-year Treasury note is up from 0.52% at the low in August 2020 and from 0.93% in just the last seven weeks.) 

Samsung and TSMC dominating semi conductor & capital expenditure cycle  

IC insights provides semiconductor industry capital spending forecasts by company for 2021 and the latest global forecast for spending through 2025. What may appear most shocking, given that Intel was one of the two largest spenders every year until 2015, is that Intel has failed to keep pace with the spending ambitions and technology advances of Samsung and TSMC. Intel spent about HALF of what Samsung spent on capex in 2020. The sheer magnitude of Samsung’s spending over the 2017-2020 time period is unprecedented in the history of the semiconductor industry. At $93.2 billion, this amount was more than double the $44.7 billion spent by all the indigenous China semiconductor suppliers combined over this same timeframe. 

With no other companies presently able to match these huge spending sums, Samsung and TSMC will likely put even more distance between themselves and their competition this year with regard to advanced IC (Integrated Circuits) manufacturing technology. 

Without extremely quick and decisive action by other IC producers or governments, “Samsung and TSMC are well on their way to world domination of leading edge IC process technology the cornerstone of all of the advanced consumer, business, and military electronic systems of the future”.

Tesla has a sudden UK Dilemma 

Today, the UK abruptly changed its EV incentive program to reduce the grant towards a new EV from £3,500 to £2,500 STARTING TODAY (March 19, 2021). The key part is that the price cap for eligibility will drop from £50,000 to £35,000 meaning the Model 3 which starts at £40,000 will no longer be eligible for the grant. In the government press release, they comment that the number of EVs under the cap of £35,000 has increased by +50% since 2019 as more cheaper models have come to market and they note that half the EVs on the market are indeed under £35,000. The change reportedly came abruptly and automakers were only informed today. Guess which BEV is under £35k? The Volkswagen ID.3. But also of note the Hyundai Kona, the MG ZS EV, the Peugeot e-208, the Corsa E, the Nissan Leaf, the BMW i3, the electric Mini, the Skoda Enyaq, the upcoming Mercedes EQA, … the list goes on. The UK was Tesla's third most important market after the US and China last year selling close to 24,000 units. 

This is all a very familiar story to us as it’s exactly what happened in the Netherlands in 2019-2020 as the incentive program phased out. The Dutch were also the 3rd largest market for Tesla in 2019 selling some 31,000 units that year but then it all changed. Ever since, the demand from our Dutch friends has waned off selling a mere 8,600 cars in 2020, down some -72%. So Tesla UK has a face-off: either drop the price of the Model 3 under £35k which will inevitably hurt margins, something it did in China when the incentives dropped or hope consumers still think Tesla Model 3 is a superior vehicle and is worth the extra premium without the grant. But no doubt volume would drop. 


Source: Mirabaud Group

Expectations and returns

Some lessons to chew on

Stories matter more than anything, but be wary of them for that reason. Stories persuade and influence like nothing else, we are all storytellers even if we haven’t realized it yet. 

Groupthink and conformity drive far too much behavior. They are everywhere. We are wired to social conformity – it’s what kept us alive for millenia on the savannah. Being thrown out of a group was literally death for our ancestors. So we do everything we can – without even knowing it – to preserve group harmony and often the status quo.

Bias is both real and hard to spot. The way we think, act, speak – so much of it is pre-determined by the configurations of our brains and the specific world we’ve been raised into. Lesson (1) is that this is true, lesson (2) is that it so much of it is beneath the surface and hard to recognize especially in ourselves. Once you realize this, psychology becomes one of the most valuable fields to understand so much of what goes on.

Friday, March 12, 2021

This week's interesting finds

Calculating your COVID stimulus payment

The Washington Post put together a simple calculator for a family to figure out how big the checks are that are coming their way. For example, a family with two parents (one who works and makes $110k per year) and three kids will get $8400. 

Calculator link

Consumers are left with massive pent up savings. 

Investing: the greatest show on Earth 

“Investing is a broader field than it looks, and there is so much to learn about it outside of the narrow lens of finance. Greed, fear, risk, opportunity, and scarcity – the most critical topics in investing – reveal themselves in all kinds of fields. 

More important is this: If you find something that is true in more than one field, you’ve probably uncovered something particularly important. The more fields it shows up in, the more likely it is to be a fundamental and recurring driver of how the world works. 

Which is to say: Restricting your investment learning to the narrow lens of finance means you’re less likely to uncover the biggest and most important parts of investing, which are the ways that people think about things like risk and reward and show up in many fields”

A New ETF named FOMO targets everything from SPACs to volatility 

A filing this week with the U.S. Securities and Exchange Commission seeks to create the FOMO exchange-traded fund, named for the famous acronym associated with countless bubbles and market manias. 

The ETF from the Collaborative Investment Series Trust intends to invest in “securities that reflect current or emerging trends,” according to a registration statement. The fund, advised by Connecticut-based Tuttle Tactical Management LLC, will select its holdings based on a “proprietary tactical model,” the filing says. 

Electric vehicles (EV)

A study by Research Affiliates on Electric vehicles: 

    “In 2020, the market capitalization of the worldwide auto industry more than doubled. The driving force was the “big new EV market”. As a result, the stock price of virtually every EV specialist, including more established firms skyrocketed. Even the prices of traditional auto makers rose handily when they announced their own EV plans. In our view, today’s electric vehicle industry is a classic example of the big market delusion. The EV phenomenon will not change the fact that the auto industry will remain highly competitive and capital intensive, and not every company can be a winner. Further, it remains unclear how simply switching the means of auto propulsion will make the entire light EV market more profitable, an assumption that the market is currently making. We suspect that as EV competition heats up, many companies will fail, as was the case in previous industry booms – whether autos, airlines or technology – and with time the total value of the industry will recede to more reasonable levels.”




What's your vintage year?

When did you become an EdgePoint partner? Select your "Partner since" year and uncover a piece of EdgePoint history.

Let's take a walk down memory lane as we recall the major events and fun facts from your vintage year.

Friday, March 5, 2021

This week's interesting finds

FAAMG is still a big part of the S&P 500 Index 

FAAMG: Facebook, Amazon, Apple, Microsoft Google

Stimulus and Investing

Speculation in the markets

Hertz, the original meme stock is turning out to be worthless 

It’s the version of David versus Goliath that Wall Street will like. Day traders, snapping up penny stocks on the popular Robinhood app, sought to defy decades of convention and make money on bankrupt rental-car company Hertz. The craze sent shares soaring as much as 896%, prompting Hertz to briefly capitalize on the frenzy by issuing even more stock. 

E-mail Is Making Us Miserable

A study, published in 2019, looked at long-term trends in the health of a group of nearly five thousand Swedish workers. They found that repeated exposure to “high information and communication technology demands” (translation: a need to be constantly connected) were associated with “suboptimal” health outcomes. 

The need to interact with each other is one of the strongest motivational forces that humans experience. The flip side of an evolutionary obsession with social interaction is a corresponding feeling of distress when it’s thwarted. Our instinct to connect is accompanied by an anxious unease when we neglect these interactions. This matters in the office, because an unfortunate side effect of overwhelming e-mail communication is that it constantly exposes you to exactly this form of social distress. A frenetic approach to professional collaboration generates messages faster than you can keep up—you finish one response only to find that three more have arrived in the interim, and, while you are at home at night, or over the weekend, or when you are on vacation, you cannot escape the awareness that the missives in your in-box are piling up ever thicker in your absence.

It is useful, of course, that we can communicate instantaneously, with almost no friction or cost. But humans are not network routers. Just because it’s possible for us to send and receive messages incessantly through our waking hours doesn’t mean that it is a sustainable way to exist. Technologies serve us best when we deploy their new efficiencies with intention, with an aim to improve the human condition.

EdgePoint Photo Contest 

While most of Canada’s colour palette is 50 shades of grey right now, the Photo Contest Committee was blessed by an orange splash of colour from some of our partners. Below is the winning submission by our very own Jelena.