Welcome to The Globe and Mail’s business and investing news quiz. Join us each week to test your knowledge of the stories making the headlines. Our business reporters come up with the questions, and you can show us what you know.
This week: A new report says that new condo investors in the Toronto region are finding the rental income from their units is not covering the increasing mortgage and other costs of owning the property. The losses are dissuading investors from buying new condo units, leading to the lowest sales in decades. Historically, developers have been able to pass on the additional costs to buyers in the condo market. But now investors are balking at the higher prices, especially given the flood of already-built condos available for sale.
Also: The Bank of Canada lowered its interest rate for the second time in a row, to the joy of those with variable-rate mortgages.
b. The government’s decision to spend millions on a new condo for him. The Commons committee is reviewing Ottawa’s purchase earlier this year of a $9-million condo for the diplomat. The three-bedroom apartment will be used to host receptions and other gatherings and is located in a posh area of Manhattan known as Billionaires’ Row.
c. 4.5 per cent. Analysts expect more cuts ahead if inflation continues to fade. That would be welcome news for homeowners facing big jumps in their mortgage payments as a result of the run-up in interest rates over the past couple of years.
a. Fairfax Financial. Toronto-based Fairfax is an insurance conglomerate with a taste for diverse, contrarian investments. Its sprawling portfolio already includes retailers such as Sporting Life and Golf Town.
b. An Israeli cybersecurity firm. Wiz was reportedly in talks to be acquired by Alphabet, parent of Google, for US$23-billion. However, the two companies called off the deal this week.
c. It raised half a billion dollars. Cohere, which was founded in Toronto in 2019, raised US$500-million in a financing round that values the startup at US$5.5-billion. Cohere focuses on building AI models that can be tailored for business applications rather than general-purpose chatbots.
d. Humanoid robots. Mr. Musk said this week that Tesla will begin using the robots in its own factories next year and then start selling them to outside buyers in 2026. However, the world’s richest man has a habit of missing deadlines – remember the self-driving taxis he promised us a few years back? – so don’t count on having a robot maid just yet.
c. Bad: Earnings plunged from a year ago. The results were nasty, with net income for the quarter plunging to US$1.48-billion from US$2.70-billion a year earlier. The company’s electric vehicle deliveries have fallen for two consecutive quarters as competition ramps up. Can robots save the day? The market doesn’t seem convinced judging from the abrupt fall in the company’s stock this week.
d. It sells online software for small to medium-sized law firms. Clio sells online software for small to medium-sized law firms. The software helps lawyers with a wide range of tasks, from scheduling appointments to billing clients to managing documents.
a. A hallucinogen derived from a rain forest shrub. Mr. Brin’s non-profit investment vehicle, Catalyst4, has poured about US$15-million into Soneira, a psychedelic startup that is exploring the use of ibogaine, a West African shrub, as a treatment for traumatic brain injury. A Stanford University study earlier this year found that ibogaine therapy helped improve cognitive function in a small group of military veterans afflicted with brain injuries.
a. To settle class-action lawsuits related to their role in a scheme to fix bread prices. Loblaw Cos. Ltd. and its parent are the first companies to settle in the lawsuit over the scheme to fix bread prices in Canada from 2001 to 2015. The lawsuit remains active against other defendants, including Canada Bread, Metro, Sobeys. and Walmart.
d. Ether. The ETFs are tied to the price of ether, the second-largest cryptocurrency after bitcoin, and make their debut only a few months after the launch of nine U.S. spot bitcoin ETFs. Enthusiasts say the flurry of products shows that crypto is becoming increasingly mainstream. Skeptics say it demonstrates how frothy the stock market has become.
b. About 80 per cent. A new report from condo researcher Urbanation and the Canadian Imperial Bank of Commerce estimates average ownership costs for a new condo in the Toronto and Hamilton region have jumped to $3,250 a month while average rents for the same units have only climbed to $2,700 a month. The ugly math has helped drive sales of new condos to their lowest levels in 27 years.