 Welcome to Mind Your Business ! Consider this your weekly guide to understanding what’s happening in the worlds of economics, business and finance. By Peter Armstrong
|  | Economic growth is contracting. (Somkid Thongdee/Shutterstock) | | | We will keep our eyes firmly focused on the trade landscape again this week.
U.S. Treasury Secretary Scott Bessent has promised a "flurry" of trade deals ahead of a July 9 deadline that could see global tariff rates increase sharply.
Wednesday's deadline applies to all the countries caught up in the so-called Liberation Day tariffs. So, this particular tranche doesn't apply to Canada.
But the Trump administration seems to be trying to convey the sense that it's refocusing on deal-making now that its budget bill has passed.
If that's true, it would be welcome news in Canada, where the impact of the trade war is becoming more clear by the day.
We got new export data last week. We will get the latest jobs numbers on Friday.
Both tell a similar story: of an economy that's holding up better than many had expected. But the damage in specific regions and sectors is very real. | | |  | | | | | Windsor, Ont., for example, had the highest unemployment rate in the country because it's so exposed to trade, shipping and manufacturing.
The Bank of Canada says about two million Canadian jobs rely on goods exports to the United States.
So, the thing to watch in this week's jobs data will be the extent to which that labour weakness spreads from trade-exposed sectors and into the areas that have so far, at least, been insulated from the trade war.
In a speech in St. John's last month, Bank of Canada governor Tiff Macklem laid out how that weakness can be contagious.
"Employment usually responds with a lag. Final domestic demand in Canada was soft in the first quarter, and if tariffs and uncertainty were to continue, households and businesses will likely remain cautious. If demand stays soft, at some point more businesses will cut jobs," said Macklem. |  | | | Macklem is right, of course, that employment responds with a lag. Most of the data points we follow do. GDP, CPI, jobs — whatever you want to use to measure the economy, it generally takes a while to get the numbers.
The jobs numbers we get on Friday will be the first real look at June's data. And they'll give us key insight into whether the damage caused in April and May was the worst of the storm... or just the beginning.
What do you think will happen? Email me at peterarmstrong@cbc.ca
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forwarded to you. | | |  | | The U.S. deadline for tariff negotiations with much of the world is this Wednesday. This doesn't apply to Canada, but any progress on trade deals will be closely watched by Canadian negotiators. | | | | | | We will get the latest jobs numbers on Friday. Canada's unemployment rate is expected to hold steady at seven per cent. Economists believe employers added about 10,000 jobs last month. | | | | | | Building permits issued in May will give us a sense of how well (or poorly) the housing construction sector is holding up amid a broad downturn in Canadian housing. Those numbers will also be released on Friday. | | | | | Three things to read, watch and listen to this week | | |  | Tech writer Joanna Stern explores the weird world of AI generated videos. (WSJ) | | | 1. How much electricity does it take to make an AI video? | | | Joanna Stern is back with another great video exploring a key issue in the tech world.
We keep hearing claims about how much energy is required to complete an AI query.
"By 2028, data centers ... across the country could use 12 per cent of all U.S. electricity, enough to power more than 55 million homes for a year," Stern reported.
She found research that calculated the actual energy consumption of specific AI commands.
But what does that really mean?
Stern, the Wall Street Journal's tech guru, has a knack for explaining these types of things in ways that are easy to wrap your head around.
In this case, she fired up an electric barbeque and added a meter to measure how much energy it consumed to cook a steak.
She also made some queries, requested some images and had an AI program make a short film.
Then she had some researchers crunch the numbers.
The text requests were about the same as four seconds on the electric grill. The images took up about 10 seconds of grill time.
But the video?
"We generated a thousand eight-second, 720-pixel clips for our film. Going by these estimates, we might have used roughly 110,000 watt hours. That's enough to grill around 478 steaks, or power an average U.S. home for three and a half days," said Stern.
The math is only half the value of the segment. Stern tours an AI data centre, speaks with researchers and interviews the head of sustainability at processor-maker NVIDIA.
Check out Joanna Stern's video on AI power consumption here. | | | 2. I hate my robots | | | When I was a kid, I watched The Jetsons. At the time, it felt less like a funny cartoon about the future and more like a promise of what was to come.
All these years later, I'm surrounded by robots. None of them are fun. Most of them don't work and all of them are annoying.
No, I'm not talking about humanoid robots like the Jetsons' Rosie. But I have a Google Assistant here, an Amazon Alexa there and Siri on my phone.
I'm swimming in robots.
Last week in the publication The Line, guest columnist James McLeod gave voice to my petty grievances.
He starts with the smart lights that tell him they're on after he turns them on. Then he pivots to the apps that link his car and his phone (one of which was discontinued years ago).
He knows some AI program is coming next and that it will maybe fix his minor irritants. But probably not. He invokes the term "enshitification" — when tech companies step in to solve a problem, destroy an existing industry and leave things worse than they were at the outset (e.g. taxis and Uber).
But to me, the best line of the piece is this:
"I can’t fix it when it breaks. I don’t know how it really works. And when my smart speaker talks back, I have no way of knowing or figuring out whether that’s a bug in the system or a setting I cannot control or just a lazy developer that neglected to build a toggle," wrote McLeod.
The whole piece is great.
Read about James McLeod's "minor irritants" here . | | | 3. Obstacles to Canada's growth | | | After federal legislation aimed at getting projects in the "national interest" approved became law last week, Prime Minister Mark Carney said now, "the real work begins."
The appetite to get these kinds of projects going is enormous. There is vast political consensus to get things built.
But there is a vast chasm between wanting to build and actually building. Understanding where the obstacles are is key to figuring out how to get things done.
David Reevely at The Logic has a fantastic piece about those obstacles and how they look from the ground.
He spoke with several CEOs trying to build ports, and terminals and mines.
And boy, oh boy, their testimony does not paint a pretty picture.
“You’re constantly chasing your tail,” said John Passalacqua, CEO of First Phosphate, a Quebec mining company that has millions of dollars in funding but no mine yet.
Passalacqua told The Logic it's impossible to get things done because as you address one issue, another arises and by the time you solve the problems, the market has changed.
“We just haven’t built mines. We just haven’t built projects. I mean, what do we build? We build nothing. We just push paper around all day long,” he told Reevely.
If the federal government wants to change the landscape, it had better do the kind of work The Logic has done here: speak with Canadian business leaders trying everything they can to get the ball rolling, but who keep running into red tape.
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Check out The Logic's article here. | | | How the economy looks beyond Bay Street | | | Exports update | | | Canada's exports to the U.S. fell in May, for the fourth straight month.
We knew the trade numbers released last week were going to show weakness. We also knew they were going to be murky. There's a ton of distortion in the data right now.
Remember, exporters tried to get goods across the Canada-U.S. border ahead of the tariffs, so there was bound to be a corresponding drop-off.
That came in April.
Last week's numbers were for May. U.S. exports continued to decline, though exports to other countries increased. | | |  | Total exports were up, but it's important to note they were up from historic lows the month before.
And yes, we shipped more stuff to other countries, but most of that was driven by a surge in gold exports to the U.K., which probably isn't the most sustainable boost to exports.
What do you think?
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