Tyler Choi of Sustainable Biz reports Brookfield, BCI, Norges to launch Northview Energy:

Brookfield Asset Management, British Columbia Investment Management Corporation (BCI) and the manager of Norway’s sovereign wealth fund have joined forces to create a renewables company named Northview Energy, which could acquire over $1 billion of assets (all figures US unless otherwise noted) in future deals.

Scheduled to launch in Q2 and valued at approximately $2.6 billion, Northview is described as a private firm that will acquire and own a diversified portfolio of contracted, operating renewable assets in the U.S. and Canada. Northview is expected to acquire a seed portfolio of assets from companies managed by Brookfield, such as U.S. companies Deriva Energy and Scout Clean Energy.

The seed portfolio, Brookfield said in a release, is to comprise 22 contracted utility-scale solar and onshore wind installations in markets “experiencing strong energy demand growth across the U.S.”

The projects total approximately 2.3 gigawatts (GW) of operating capacity and are newly operational, according to Brookfield. Norges Bank, Norway's central bank which manages the country's sovereign wealth fund, said the 22 projects are made up of 17 solar facilities and five onshore wind farms across 11 states.

The assets are backed by long-term power purchase agreements with investment grade counterparties, with a weighted average remaining term of approximately 16 years.

Sustainable Biz Canada has reached out to Brookfield for additional comment. Brookfield replied but provided no details.

Equal ownership in Northview

The three parties behind Northview signed the agreement for the company on Feb. 25, Norges Bank said.

Northview has also entered into a framework agreement for potential future acquisitions of renewable assets from Brookfield-managed portfolio companies in the U.S. and Canada, representing up to $1.5 billion of equity capital.

“This partnership marks the creation of a scalable platform for Brookfield and our partners,” Jehangir Vevaina, chief investment officer of Brookfield’s renewable power and transition group, said in the announcement.

“Northview Energy will be an owner of high-quality operating assets that deliver affordable and clean power to the grid and the framework for future acquisitions provides a clear growth pathway for the vehicle to add de-risked, high-quality, cash-yielding assets delivering strong returns.”

Brookfield, BCI and Norges Bank Investment Management will share customary governance rights for Northview, and will equally fund and own the company.

Future acquisitions are expected to focus on de-risked operating assets, such as onshore wind, utility-scale solar and battery storage.

“Northview is a highly strategic addition to our infrastructure portfolio, bringing together de‑risked renewable energy assets, long‑term contracted revenues, and a clear path for growth alongside like-minded, high‑calibre partners," Lincoln Webb, the executive vice-president and global head of infrastructure and renewable resources at BCI, said in the announcement.

Despite regulatory pressures on the renewables sector in the U.S., clean energy infrastructure continues to be developed. Much of the rising demand for electricity in 2027 will "will be met by growth in generation from renewable sources of energy," the U.S. Energy Information Administration said in a February report.

The Canadian Renewables Association expects 2026 "to set a pace for steady growth that will continue into the next decade and beyond." The industry organization anticipates eight GW of new renewables capacity by 2029.

The three owners of Northview

Based in New York but majority owned by Toronto's Brookfield Corporation, Brookfield Asset Management has over $1 trillion of assets under management across the renewables, infrastructure, private equity, real estate and credit sectors.

In its 2024 sustainability report, the latest to date, the company reported its target to reach net-zero across its operationally managed investments by 2050 or sooner. It also highlighted commissioning approximately 15 GW of clean energy capacity since 2022 and raising over $37 billion in its transition business.

Based in Victoria, BCI is an institutional investor with C$295 billion in assets under management as of March 31, 2025. BCI’s Infrastructure & Renewable Resources program is a diversified portfolio valued at C$32.2 billion as of March 31, 2025. The program has assets located around the world including the U.S., emerging markets and Canada.

Norges Bank manages the Norwegian government’s pension fund, the world’s largest sovereign wealth fund valued at approximately $2.1 trillion. As part of its 2025 climate action plan, the pension fund increased its renewable energy infrastructure portfolio to almost $8.7 billion.

Northview “marks our first investment in North America and an important step in diversifying our renewable energy infrastructure portfolio,” Harald von Heyden, global head of energy and infrastructure at Norges Bank, said. 

Earlier today, BCI issued a press release on the deal with Brookflied and NBIM to launch Northview Energy:

new renewable energy platform anchored with high-quality, contracted, utility scale solar and onshore wind assets

All amounts are in U.S. dollars unless otherwise indicated

VICTORIA, OSLO and NEW YORK — British Columbia Investment Management Corporation (“BCI”), Norges Bank Investment Management and Brookfield today announced the launch of Northview Energy (the “Company” or “Northview”), a privately held renewable energy company that will acquire and own a diversified portfolio of contracted, operating renewable assets in the U.S. and Canada.

Northview Energy will be equally funded and owned by the three investors. The Company will acquire a seed portfolio of assets from leading renewable energy companies currently managed by Brookfield, including assets from Deriva Energy, Scout Clean Energy and Urban Grid.

Northview offers a highly de-risked, stable cash flow profile, generating predictable income with strong downside protection, and resilience across market cycles. The seed portfolio is comprised of 22 contracted, high-quality utility scale solar and onshore wind assets in power markets experiencing strong energy demand growth across the U.S. The assets are newly operational and represent approximately 2.3 gigawatts of operating capacity diversified across six power markets. All assets are backed by long-term power purchase agreements with investment grade counterparties, with a weighted average remaining term of approximately 16 years.

BCI, Norges Bank Investment Management and Brookfield will share customary governance rights and a dedicated management team will be appointed to lead the Company.

Northview has also entered into a Framework Agreement for potential future acquisitions of renewable assets from Brookfield-managed portfolio companies in the U.S. and Canada representing up to $1.5 billion of equity capital.

Future acquisitions are expected to focus on de-risked operating assets, including onshore wind, utility scale solar and battery storage, generating stable and predictable cash flows under long-term contracts with investment grade counterparties. Any future acquisitions made by Northview will be subject to the prior approval of BCI, Norges Bank Investment Management and Brookfield, with each party contributing pro rata to fund acquisitions.

Lincoln Webb, Executive Vice President & Global Head, Infrastructure & Renewable Resources at BCI, said: “Northview is a highly strategic addition to our infrastructure portfolio, bringing together de‑risked renewable energy assets, long‑term contracted revenues, and a clear path for growth alongside likeminded, high‑calibre partners. With a diversified portfolio of new solar and wind projects serving an established base of premium clients, the platform is designed to be resilient in an evolving energy landscape.”

Harald von Heyden, Global Head of Energy and Infrastructure at Norges Bank Investment Management, said: “This marks our first investment in North America and an important step in diversifying our renewable energy infrastructure portfolio. We are pleased to partner with Brookfield and BCI as we seek to capture compelling opportunities in one of the world’s largest renewable energy markets.”

Jehangir Vevaina, Chief Investment Officer for Brookfield’s Renewable Power & Transition group, said: “This partnership marks the creation of a scalable platform for Brookfield and our partners. Northview Energy will be an owner of high-quality operating assets that deliver affordable and clean power to the grid and the framework for future acquisitions provides a clear growth pathway for the vehicle to add de-risked, high-quality, cash yielding assets delivering strong returns.”

Subject to the receipt of required approvals and the satisfaction of customary closing conditions, Northview Energy is expected to officially launch during the second quarter of 2026 under the ownership of BCI, Norges Bank Investment Management and Brookfield. More information about the company can be found at www.northviewenergy.com.

TD Securities acted as exclusive financial advisor to Brookfield on the sale of the seed portfolio and commitment for future acquisitions.

 Brookfield issued the same press release here.

NBIM issued this press release on the deal:

The agreement was signed on 25 February 2026.

Norges Bank Investment Management will pay approximately USD 425 million for its 33.3 percent interest in the portfolio, valuing the total enterprise at approximately USD 2.6 billion. The investment is made alongside British Columbia Investment Management Corporation (BCI) and Brookfield, with each partner holding an equal ownership stake.

"This marks our first investment in North America and an important step in diversifying our renewable energy infrastructure portfolio. We are pleased to partner with Brookfield and BCI as we seek to capture compelling opportunities in one of the world's largest renewable energy markets," says Harald von Heyden, Global Head of Energy and Infrastructure at Norges Bank Investment Management.

The portfolio comprises 22 operating assets totalling approximately 2.3 GW of capacity, including 17 utility-scale solar facilities and 5 onshore wind farms across 11 states and six power markets.

[1] Norges Bank Investment Management is the fund management division of Norges Bank. All unlisted (or direct) investments in real estate and renewable energy infrastructure are made and managed by subsidiary structures set up by Norges Bank.

Alright, week off in Quebec but this is a huge deal which I need to cover quickly.

I would invite my readers to learn more about Northview Energy here.

A quick overview of the company:

The supplier of choice for the organizations and enterprises that power the world economy forward. Created to meet the growing demand for reliable, large-scale renewable energy solutions from enterprise customers. Operating across North America with multiple owned and operated renewable sources, backed by long-term institutional capital. Improving life through energy. 

Our clean energy assets are newly developed and operational, built to the highest standards and generating power in as little as 6 months from standing start. 

Existing enterprise clients and organizations already take 99% of current renewable energy capacity, with significant demand for more. 

We have a roadmap of planned expansion across energy types and locations to grow our footprint and capacity across North America.

Valued at approximately US$2.6 billion, Northview will commence operations in Q2 and is expected to acquire a seed portfolio of assets from companies managed by Brookfield, such as US companies Deriva Energy and Scout Clean Energy.

From the first article: 

The seed portfolio, Brookfield said in a release, is to comprise 22 contracted utility-scale solar and onshore wind installations in markets “experiencing strong energy demand growth across the U.S.”

The projects total approximately 2.3 gigawatts (GW) of operating capacity and are newly operational, according to Brookfield. Norges Bank, Norway's central bank which manages the country's sovereign wealth fund, said the 22 projects are made up of 17 solar facilities and five onshore wind farms across 11 states.

The assets are backed by long-term power purchase agreements with investment grade counterparties, with a weighted average remaining term of approximately 16 years.

That last part is critical because these long-term power purchase agreements offer great downside protection and have inflation adjustments embedded in them.

Lincoln Webb, Executive Vice President & Global Head, Infrastructure & Renewable Resources at BCI, stated it well in the press release:

“Northview is a highly strategic addition to our infrastructure portfolio, bringing together de‑risked renewable energy assets, long‑term contracted revenues, and a clear path for growth alongside likeminded, high‑calibre partners. With a diversified portfolio of new solar and wind projects serving an established base of premium clients, the platform is designed to be resilient in an evolving energy landscape.”

And now BCI, NBIM and Brookfield will co-own the platform and nurture it as it grows and acquires more renewable energy projects.

This is a terrific renewable energy platform backed by three leading global investors. 

Great deal, had to cover it, time to take some time off.

Below, Brookfield CEO Bruce Flatt on The Pulse with Francine Lacqua (5 days ago). 

Great interview, take the time to watch it. 

This op-ed was originally published on MS NOW. Read the full piece here. 

President Donald Trump has said some strikingly out-of-touch things about affordability: that it’s a “hoax,” he’s “solved it” and he’s “won affordability.” In his State of the Union address, he even said “prices are plummeting downward.” U.S. families know this is nonsense. But to see how much Trump’s policies will erode affordability in the coming years, you must understand that affordability isn’t just about prices. 

Affordability is the outcome of a race between incomes and prices. And for typical families, the Trump agenda is near-guaranteed to harm their incomes far more than it can possibly reduce their prices. 

Even judged by the movement of prices alone, Trump’s record on affordability is poor. Inflation fell from 8.0% to 3.0% in the final two years of the Biden administration. This rapid downward movement slowed to a crawl in the first year of Trump’s second term, with inflation falling from 3.0% to just over 2.6%.

There are clear policy reasons why progress in reducing inflation has slowed. Electricity prices have surged as the Trump administration has ended subsidies for renewable generation passed during the Biden administration. The Trump tax cuts passed in the president’s first term were part of a law that gouged loopholes in the tax code, including inviting pharmaceutical companies to offshore their production and import back into the United States. Last year the Trump administration put tariffs on these offshored pharmaceuticals, pushing up their costs. When the administration failed to extend Obamacare subsidies for people buying health insurance through the exchanges, healthier enrollees who could afford to began opting out, driving up prices for everybody left in the Affordable Care Act marketplace.  

And these are not the only ways that Trump administration policies have intensified affordability issues for ordinary Americans.

Read the full piece here. 

Canadian Property Management reports CPP Investments inks Nordic data centre deal:

Canada Pension Plan Investment Board (CPP Investments) is furthering its collaboration with the global digital infrastructure company, Equinix, through joint acquisition of the atNorth data centre portfolio, stretching across five Nordic nations. CPP Investments will contribute roughly USD $1.6 billion to secure a 60 per cent controlling interest in atNorth, which encompasses eight operational data centres and three high-density colocation facilities now in development.

“The Nordics are an attractive market for data centre growth and the opportunity to partner with Equinix on this acquisition allows us to deploy capital at scale into a high-quality platform,” says Maximilian Biagosch, senior managing director and global head of real assets with CPP Investments.

The two investors are already part of a three-way partnership with the sovereign wealth fund, GIC, focused on developing hyperscale data facilities in the United States. The atNorth deal aligns with CPP Investments’ data centre strategy and augments publicly traded Equinix’s presence in the Nordics, where it currently operates eight data centres in Helsinki, Finland and Stockholm, Sweden.

The new acquisitions will continue to operate under the atNorth brand, which is headquartered in Reykjavik, Iceland, with presence in Denmark, Finland, Norway and Sweden. The data centre provider has 800 megawatts of installed or in-development capacity, and has power agreements in place to enable an additional 1 gigawatt of capacity and a move into hyperscale services. Its existing portfolio applies renewable energy resources, heat reuse technology and design efficiencies to reduce environmental impacts — also in step with Equinix’s renewable energy footprint for its European operations and target for net-zero emissions globally by 2040.

“Combined with our joint focus on sustainability, this acquisition is expected to enhance our ability to help customers unlock the full potential of the Nordics’ expanding digital landscape,” maintains Bruce Owen, president of Equinix in the EMEA (Europe, Middle East, Asia) market. “We are delighted to partner with CPP Investments, whose long-term track record of investing in the sector is highly complementary to Equinix’s connectivity services.”

“I’m extremely proud to announce the next step in our chapter, welcoming this investment from CPP Investments and Equinix, which will enable access to capital, global enterprise and hyperscale relationships, and supply chain strength required to scale at pace,” says Eyjólfur Magnús Kristinsson, atNorth’s chief executive officer.

The USD $4.2 billion agreement covers both the acquisition and capital for future expansion, with underwriting advanced by Canadian and European lenders. It will be finalized subject to regulatory approvals and other closing conditions.

Last week, CPP Investments issued a press release stating it entered into a joint agreement with Equinix to purchase atNorth, a leading Nordic data center provider:

Leading Data Center Provider in the Nordics Has Operations in Five Countries, Providing Equinix with Access to Capacity to Meet Enterprise, AI and Hyperscale Demand in Key Markets

TORONTO, Canada and AMSTERDAM, Netherlands – February 27, 2026 – Canada Pension Plan Investment Board (CPP Investments) and Equinix, Inc. (Nasdaq: EQIX), the world’s digital infrastructure company®, today announced they have entered into a joint agreement to purchase atNorth—a leading Nordic high-density colocation and built-to-suit data center provider—from Partners Group, one of the largest firms in the global private markets industry.

The US$4 billion enterprise value transaction is subject to customary closing conditions, including regulatory approvals. The agreement between CPP Investments and Equinix will support atNorth in its continued rapid scaling, through capturing opportunities created by rising demand for data center infrastructure. CPP Investments will invest approximately US$1.6 billion, owning an approximate 60% controlling interest, and Equinix will own an approximate 40% stake. The transaction is expected to be immediately accretive upon close to Equinix’s adjusted funds from operations (AFFO) per share.

atNorth’s portfolio includes eight operational data centers alongside several sites under development across Denmark, Finland, Iceland, Norway and Sweden, as well as plans for further expansion, with 1 GW of secured power and a considerable amount of additional future capacity planned. Designed to meet increasing demand for AI and high-performance computing, several of the company’s facilities are liquid cooling-enabled to support high-density workloads. Across its portfolio, atNorth integrates renewable energy sourcing, heat reuse initiatives and efficient modular design to advance circular economy principles and minimize environmental impact.

“This acquisition is a powerful validation of atNorth’s journey and its market position as the leading Nordics data center platform,” said Eyjólfur Magnús Kristinsson, CEO of atNorth. “It further illustrates the strategic importance of the region as Europe’s rising AI powerhouse. I’m extremely proud to announce the next step in our chapter, welcoming this investment from CPP Investments and Equinix, which will enable access to capital, global enterprise, and hyperscale relationships, and supply chain strength required to scale at pace. Our strategy remains firmly rooted in the Nordics, and we will continue to operate independently under the atNorth brand, preserving our dedication to the communities where we operate and the culture and values that have defined our success to date.”

“This transaction builds on our long-standing and highly productive relationship with Equinix,” said Maximilian Biagosch, Senior Managing Director & Global Head of Real Assets, CPP Investments. “It demonstrates our conviction and commitment to the data center sector, where demand continues to accelerate, fueled by continued strong enterprise demand as well as cloud and AI adoption. The Nordics are an attractive market for data center growth and the opportunity to partner with Equinix on this acquisition allows us to deploy capital at scale into a high-quality platform, helping us deliver attractive risk-adjusted returns for CPP contributors and beneficiaries.”

“The scalable sites of atNorth are very complementary to Equinix’s connectivity services and global footprint. Combined with our joint focus on sustainability, this acquisition is expected to enhance our ability to help customers unlock the full potential of the Nordics’ expanding digital landscape,” explained Bruce Owen, President, EMEA, Equinix. “For businesses looking to scale with resilience, Equinix offers a future-ready infrastructure for long-term success, maintaining the jurisdictional and data sovereignty of organizations operating in the region. We are delighted to partner with CPP Investments, whose long-term track record of investing in the sector is highly complementary to Equinix’s connectivity services.”

There are multiple factors contributing to the Nordics’ burgeoning status as a critical hub for the next generation of digital growth. The Nordics region is widely recognized for its strong and resilient economy, supported by a long‑standing emphasis on innovation, research and technical expertise. Renowned worldwide for its leadership in environmentally sustainable projects, the Nordic region provides access to renewable energy sources, bolstered by its naturally cool climates.

Highlights / Key Facts

• As part of the transaction, CPP Investments and Equinix have provisionally agreed to a financing package of US$4.2 billion (€3.6 billion), underwritten by a group of European and Canadian lenders to fund the transaction as well as the capital required to fund the expansion of the business.
• atNorth has an installed and active development pipeline of approximately 800 MW that will come online over the next five years. In addition, it has plans for significant further expansion, with an additional 1 GW of secured power and a considerable amount of future capacity planned, providing a platform for future expansion across the Nordics.
• Equinix currently operates eight data centers in the Nordics, including five in Helsinki and three in Stockholm, contributing to a wider European footprint of over 100 facilities across 20 countries. This regional reach enables customers to deploy infrastructure close to end users and directly connect with AI, cloud, network and enterprise partners anywhere in the world.
• The transaction adds to CPP Investments’ long-standing collaboration with Equinix, which includes a 2024 joint venture alongside GIC to expand the Equinix xScale® data center program.
• The investment further enhances CPP Investments’ global data center strategy and builds out its presence in Europe.
• Designing for responsible operations and in line with atNorth’s sustainability focus, Equinix operates all its European facilities with 100% renewable energy coverage and is on track to achieve its global net-zero target by 2040. The company’s environmental strategy centers around implementing energy efficiency initiatives to optimize energy usage, piloting innovative decarbonization solutions and collaborating with suppliers to address emissions.
• Equinix delivers customer-controlled sovereignty, providing the foundation of digital infrastructure—secure facilities, reliable power, private connectivity—with customers keeping 100% control of their technology stack, data and operational decisions. The company’s global infrastructure enables organizations to access comprehensive ecosystems around the world while maintaining uncompromising local control.
• Equinix was advised by Guggenheim Securities Europe Ltd. as financial advisor as well as Slaughter and May as legal advisor.

Additional Resources

• Sustainability at Equinix [website]
• Unmatched interconnection, scalable colocation and infrastructure across Europe, the Middle East and Africa [website]
• What’s Driving the Digital Economy in the Nordic Countries? [blog]
• The Future of Autonomous Networking: How AI Is Redefining Connectivity [blog]

About atNorth

atNorth is the leading Nordic data center company that offers cost-effective, scalable high-density colocation and built-to-suit services trusted by industry-leading organizations. With sustainability at its core, atNorth’s data centers run on renewable energy resources and support circular economy principles. All atNorth sites leverage innovative design, power efficiency, and intelligent operations to provide long-term infrastructure and flexible colocation deployments. atNorth is headquartered in Reykjavik, Iceland and operates eight data centers in strategic locations across the Nordics, as well as a ninth under construction in Kouvola, Finland, a tenth site in Ølgod, Denmark and an eleventh campus in Stockholm, Sweden. The business has also announced a new mega-site development in the Sollefteå Municipality in Sweden.

For more information, visit atNorth.com or follow atNorth on LinkedIn.

About CPP Investments

Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the Canada Pension Plan Fund in the best interest of the more than 22 million contributors and beneficiaries. In order to build diversified portfolios of assets, we make investments around the world in public equities, private equities, real estate, infrastructure, fixed income and alternative strategies including in partnership with funds. Headquartered in Toronto, with offices in Hong Kong, London, Mumbai, New York City, São Paulo and Sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At December 31, 2025, the Fund totaled C$780.7 billion. For more information, please visit www.cppinvestments.com or follow us on LinkedIn, Instagram or on X @CPPInvestments.

About Equinix

Equinix, Inc. (Nasdaq: EQIX) shortens the path to boundless connectivity anywhere in the world. Its digital infrastructure, data center footprint and interconnected ecosystems empower innovations that enhance our work, life and planet. Equinix connects economies, countries, organizations and communities, delivering seamless digital experiences and cutting-edge AI—quickly, efficiently and everywhere. 

It's March break here in Quebec, so I will be very brief.

This is another fantastic acquisition for CPP Investments, partnering with Equinix to acquire atNorth. 

To really appreciate this transaction, I invite you read this 2024 interview where atNorth CEO Eyjólfur Magnús Kristinsson discussed the DEN02 project in Denmark:

In an interview, atNorth’s CEO Eyjólfur Magnús Kristinsson discussed the company’s newest project, DEN02—a mega data center in Denmark set to advance heat reuse for greenhouses and local housing. With an initial capacity of 250MW and plans for significant scalability, DEN02 aims to make atNorth a major data center provider in Denmark.

The center will support colocation and high-performance computing (HPC) needs, especially for AI-intensive workloads, leveraging Denmark’s green energy grid.

The DEN02 data center is strategically designed to support high-density workloads, providing infrastructure for both colocation clients and custom, build-to-suit projects tailored to AI and HPC applications.

The scale and advanced engineering of DEN02 make it one of the largest data center initiatives in Denmark. Designed with sustainability in mind, DEN02 will harness Denmark’s green energy grid and leverage innovative heat reuse methods, providing residual heat for large-scale greenhouses and local housing.

AtNorth’s partnership with WARM, a local greenhouse developer, ensures that DEN02’s heat reuse plan will directly benefit the region, contributing to local food production and reducing heating costs for nearby homes.

Expected to break ground by Q1 2026, DEN02 represents a milestone in atNorth’s growth and its commitment to integrating environmental and community benefits into data center operations.

atNorth’s vision includes strong local engagement, with DEN02 bringing jobs and sustainable infrastructure, positioning Denmark as a strategic hub for AI and HPC in Northern Europe.

Read the whole interview here. 

This company is top, Equinix did its homework here before presenting this deal to CPP Investments which is now taking a controlling stake, adding to its already impressive data center platform all over the world.

Below, following a varied career starting in sales before moving up into managerial roles across the IT industry, Eyjólfur Magnús Kristinsson is now at the helm of atNorth, a pan-Nordic colocation, high-performance computing and artificial intelligence service provider, which soon will be present in all Nordic nations (2024).

Sean Conlon and Pia Sinh of CNBC report the Dow closes more than 500 points lower after hot inflation report, mounting concerns about AI impact:

Stocks dropped on Friday after the latest producer price index data came in much hotter than expected, adding sticky inflation to a list of concerns that has caused market turbulence this month.

The Dow Jones Industrial Average dropped 521.28 points, or 1.05%, to close at 48,977.92. The S&P 500 closed down 0.43% at 6,878.88, while the Nasdaq Composite lost 0.92% to settle at 22,668.21.

The S&P 500 and Nasdaq finished in the red for February amid growing fears about the impact of artificial intelligence on specific industries and the overall economy. Those fears were exacerbated after Jack Dorsey’s fintech company Block said it’s laying off more than 4,000 employees — nearly half of its workforce. Stocks in the financial sector and other areas of the market tied to the economic cycle pulled back Friday.

Stocks linked to private credit were under pressure again as investors anticipated that they could be potentially suffer as a result of UK mortgage provider Market Financial Solutions’ collapse. Apollo and Jefferies were among the laggards, dropping more than 8% and 9%, respectively. Shares of Blue Owl, which has been hit recently in the wake of its liquidity curbs and asset sale, fell about 6%.

Notable software names suffered losses as well Friday as they close out a terrible month. Salesforce tumbled more than 2%, as did Microsoft, which weighed on the Dow. Cybersecurity company Zscaler shed 12% after deferred revenue and billings in the fiscal second quarter missed expectations. CoreWeave fell 18% on disappointing guidance.

Nvidia extended its post-earnings slide with a 4% fall Friday. The stock shed more than 5% on Thursday, a surprise to many investors who remain bullish on the chipmaker given its blowout fourth-quarter results and upcoming product cycle. Market participants attributed the decline in shares to doubts around Nvidia’s deal with OpenAI, weak sentiment over the AI trade and skepticism about whether hyperscalers’ lofty AI capital expenditures are sustainable.

Fueling the downbeat sentiment, January’s producer price index — a measure of wholesale inflation — showed a 0.5% increase for the month. Economists polled by Dow Jones saw the headline reading coming in at 0.3%. Perhaps more concerning is that the core PPI reading, which excludes food and energy prices, recorded a 0.8% gain, much more than the 0.3% rise economists anticipated.

Stephen Kolano, chief investment officer at Integrated Partners, views the PPI report as an additional complication for investors on top of the already-existing anxieties surrounding not just AI capex and the risk of its disruption to industries but also other factors such as stress in the private credit market. Noting that the inflation reading seems to be more services driven, he thinks it’s a sign companies are possibly starting to pass through the cost of tariffs to the end consumer in order to maintain their margins.

“Inflation isn’t solved yet,” he said, adding that it creates this conundrum for the Federal Reserve of deciding whether to cut interest rates to spur growth or to hold steady to continue to fight inflation. “It just creates this uncertainty around which way is policy going to go in the remainder of the year.”

That’s not to mention the state of the labor market as another worry, Kolano said. Even though job growth last month was much better than expected, the investment chief said he isn’t sure that the labor market is stabilizing given that layoffs have been picking up. In fact, Challenger, Gray & Christmas reported earlier this month that layoffs in January hit their highest total for that month since the global financial crisis.

“I don’t see a clear sign that unemployment is not going to move higher just yet,” he said.

The Nasdaq posted a decline of more than 3% in February, seeing its worst monthly performance since last March. The iShares Expanded Tech-Software ETF (IGV) is down nearly 10% for the month, bringing its year-to-date losses to almost 23%. The S&P 500, meanwhile, recorded a loss of close to 1% in February, while the Dow climbed about 0.2%. 

Rian Howlett  ,  Karen Friar and Jake Conley of Yahoo Finance also report the Dow, S&P 500, Nasdaq fall to end volatile month as AI worries buffet markets:

US stocks sank on Friday after a measure of wholesale inflation came in hotter than expected and Block's (XYZ) surprise shakeup turned the spotlight on AI disruption risks.

The Dow Jones Industrial Average led the way down with a loss of 1%, or more than 500 points. Meanwhile, the Nasdaq Composite fell 0.8%, while the S&P 500 dropped 0.4%, respectively, on the heels of sharp closing losses for the tech-heavy indexes.

The Dow barely eked out a gain in February, keeping its nine-month winning streak intact, with the blue-chip index rising 0.17% for the month. The Nasdaq and S&P 500 declined more than 3.3% and 0.86%, respectively, for the month.

Ongoing worries over private credit rippled through the market, while concerns that AI could wreak havoc across a swath of industries also came into focus. Those fears were stoked on Thursday when Block co-founder Jack Dorsey said the fintech will cut nearly half its workforce due to AI productivity.

Elsewhere in corporate news, Netflix (NFLX) shares rose after the streaming giant abandoned its pursuit of Warner Bros. Discovery (WBD). That left rival Oracle (ORCL)-linked bidder Paramount Skydance (PSKY) to clinch a buy of the Hollywood studio, giving its stock a boost, too.

On the macro front, January’s producer price index rose 0.5% month over month, showing that wholesale inflation grew at a faster pace than the 0.3% rise economists expected. Core PPI — which excludes volatile food and energy prices — of 0.8% for the month also exceeded forecasts of 0.3%.

Looking ahead, Berkshire Hathaway (BRK-B, BRK-A) CEO Greg Abel is expected to publish his first annual shareholder letter on Saturday, after taking over from Warren Buffett. It will come out alongside the conglomerate's quarterly and 2025 update. 

Software got punched in the gut in February

It's fitting that February ended with another tech sell-off led by software, as the iShares software ETF (IGV) dropped roughly 10% for the month after probing last summer's lows earlier this week. 

A few names bucked the trend — RingCentral (RNG) gained about 40% while Cisco (CSCO) and SAP (SAP) were little changed. But the story is the breadth of the red and the technical damage.

Microsoft (MSFT) is down almost 9%, wiping out over $270 billion in market capitalization, while Oracle (ORCL) fell nearly 13% for a $60 billion drop. Palantir (PLTR), Intuit (INTU), and Palo Alto Networks (PANW) each shed about $25 billion.

On the other end of the tape, the biggest drawdowns were ugly: Unity (U) and Atlassian (TEAM) were both off over 35%, while Asana (ASAN) declined 30% and Zscaler (ZS) only a little less.

Alright, another crazy week in the US stock market, where we once again saw more selling of tech stocks in general, including beaten-down software stocks, although they look to be bottoming here.

Here are this week's best-performing large-cap stocks (full list here): 

Among them are Paramount Skydance, Netflix, Dell, Block, and Thompson Reuters.

And here are this week's worst-performing large-cap stocks (full list here):

 Among them are Novo Nordisk, First Solar, KKR, and Apollo Asset Management.

 More impressive this week were how some of the mid-cap stocks rallied hard (full list here):

 

Among them are Applied Optoelect, Palvella Therapeutics, Iovance Biotherapeutics, and 10X Genomics.

Now more than ever, it's a market of stocks; you really need to pick your spots carefully. 

In other big news, cutting nearly 40% of its workforce, Block loudly professed that the days of AI taking the jobs of humans has arrived. 

Is a massive AI deflationary wave in the making? Maybe, too soon to tell. 

Alright, enjoy your weekend, that's a wrap.

Below, BMO Senior Equity Analyst Brennan Hawkin joins 'Closing Bell Overtime' to talk the state of the private credit markets as the sector sees a downturn.

Next, Dan Ives, Wedbush Securities, joins 'Closing Bell' to discuss the rough week for shares of Nvidia, the recent funding round from OpenAI and much more.

Jason Lemire on LinkedIn shows why Nvidia's real liabilities are more than twice what is shown on the balance sheet (see his post here).

Third, Warren Pies, 3Fourteen Ventures, joins 'Closing Bell Overtime' to talk why he is bearish on the markets due to the impact of AI on labor.

Fourth, Tom Lee explains why February felt worse than it was, why Nvidia’s valuation stands out, and why March could be a turnaround month.

Lastly, legendary macro investor Stan Druckenmiller joins Hard Lessons for a conversation with Iliana Bouzali, Global Head of Derivatives Distribution and Structuring at Morgan Stanley. 

Druckenmiller reflects on his early career and how he learned to act decisively and change course quickly when the facts on the ground shift. Hear how he would construct a portfolio if he had to start over today, why contrarianism is overrated, and which stock he regrets selling too early. 

Amazing interview, Stan is the man!! 

Too many U.S. employers are breaking the social contract by paying unfairly and inefficiently low wages. These low wages are one reason why even people who work regularly throughout the year can qualify for income assistance programs like Medicaid and the Supplemental Nutrition Assistance Program (SNAP).

Further, the Republican-led One Big Beautiful Bill (OBBB) that passed last year will sharply cut Medicaid and SNAP over the next decade by well over $1 trillion combined.

The combination of these trends—low-road employers paying insufficient wages and big upcoming cuts to Medicaid and SNAP—has led to a flurry of policy proposals at the state level to address them. One proposal—employer assessment fees (EAFs)—appears at first glance to address both problems by imposing a tax on firms that employ workers who receive Medicaid or SNAP, with the tax often calculated as the number of workers receiving these benefits multiplied by the average cost of those benefits. But EAFs are not the optimal solution to either problem and might cause undesirable collateral damage.

Here’s why:

• Medicaid and SNAP do not make it easier for employers to offer lower wages. In fact, they likely raise the wages needed to attract workers—and that’s a good thing.
  • This is not universal across all safety net and income support programs. Some of these, like the Earned Income Tax Credit (EITC), do see some of their benefits likely bypass workers and captured by low-wage employers.
• If you make Medicaid-receiving workers more expensive to employ, then employers will try to employ fewer of them and/or lower their market wages. And if the tax is proportional to the average cost of benefits like Medicaid, this incentive is large.
• Employer assessments fees are generally a large tax imposed on a small base. But revenue is maximized when tax bases are broad.
• The targets of EAFs can be more effectively reached with other policies.
  • Raising minimum wages and passing legislation to strengthen workers’ rights to unionize and bargain collectively are alternative policies for forcing employers to pay more.
  • Broad-based taxes are alternative polices for raising revenue.
    • Higher corporate income taxes or employer-side payroll taxes would be more progressive alternatives for taxing employers.
    • Another alternative would be to penalize firms that don’t offer employer-sponsored health insurance (ESI) to workers. This is not a huge base, but it is by definition wider than those who receive Medicaid (which is just a subset of all workers not receiving ESI through the firm.)

Below, we expand on these points.

Medicaid and SNAP do not make it easier for employers to offer lower wages

A concern is often expressed that Medicaid and SNAP “subsidize” low-wage employers by making it easier for them to offer lower wages. Intuitively, thinking that Medicaid and SNAP subsidize low-wage employers actually gives these employers far too much credit for caring about the living standards of their workers. Higher pay is not given out of the goodness of employers’ hearts—it happens when policy or market conditions change. Medicaid and SNAP do not change labor market conditions in any way that lowers workers’ pay, and when these programs are cut in coming years, low-wage employers are not going to think “we need to raise our wages to help these employees who are seeing cuts to other income sources.” They will instead raise wages only if policy mandates they do or if market conditions change.

In reality, Medicaid and SNAP actually boost lower-wage workers’ meager leverage to demand higher pay by making periods of non-work less miserable. This slightly improved fallback position for low-wage workers keeps them from being forced as quickly by material deprivation into accepting any possible wage offer from employers. Policy changes that reduce how many workers receive Medicaid or SNAP will put further downward pressure on wages. We should support policies that expand the number of workers who have their wages supplemented by safety net programs, not policies that penalize and stigmatize using benefits.

This wage-boosting effect is not universal among all public income support programs. The Earned Income Tax Credit (EITC), for example, pays more as workers supply more hours to the paid labor market. This boost to labor supply puts some downward pressure on market wages and can lead to some of the EITC benefits bypassing workers and being captured by employers (unless it is complemented by strong minimum wages.)

Making workers who receive safety net benefits more expensive will reduce demand for them

If you make workers who receive safety net benefits more expensive for employers to keep on payroll, then you increase the incentive for these employers to hire fewer of them or offer them lower wages.

Supporters of EAFs could argue this logic could be employed against any effort that made workers more expensive, like minimum wages. But minimum wages apply to all workers, and employers by definition cannot lower wages to absorb the higher costs minimum wages impose. Fully substituting away from workers whose pay has been lifted by minimum wages and toward other inputs essentially means employers would have to make costly investments in plant, capital, equipment, and processes.

Conversely, only a small fraction of workers receives safety net benefits. Absent binding minimum wages, employers can lower their market-based pay to recoup the EAFs (at least until they run into the relevant minimum wage in the labor market.) Trying to substitute away from workers who receive safety net benefits toward workers who are less likely to receive these benefits is more doable for employers than substituting away from all lower-wage labor.

These employer efforts to figure out who on their payroll is likely to trigger an EAF could lead to collateral damage. Workers from groups that are more likely to receive safety net benefits might be discriminated against across-the-board, regardless of whether or not they are actually enrolled in Medicaid or SNAP. Basically, EAFs mean that populations who are more likely to use benefits—like low-income single moms—would face even greater barriers in the labor market. Workers of color are also overrepresented among the families who use SNAP and Medicaid.

Further, the direct benefits of broad-based minimum wages to workers are large—all low-wage workers get a raise if their pay was lower than the new minimum. The direct benefits to any worker from an EAF is nonexistent—their pay does not rise, and they are not more likely to receive employer benefits.

The indirect benefits of EAFs are simply the revenue they raise, and if this revenue can be raised in less costly ways, then EAFs are not optimal.

EAFs are a large tax on a small base

Workers who receive Medicaid benefits constitute roughly 10% of the overall workforce (and their share of total hours is significantly less than this). This is a relatively small base for a tax. But the size of proposed EAFs is often quite large, sometimes as large as the average Medicaid benefit. This benefit can reach more than $9,000 annually in many states. For a full-time, year-round worker making $15 an hour, this constitutes a tax on employers equivalent to 30% of that worker’s entire earnings.

Large taxes on small bases often lead to behavioral responses that erode the revenue gained from the tax. The large value of the tax incentivizes this avoidance behavior, and the small base allows substitution away from workers who trigger the tax. This means that EAFs would raise—at best—a highly uncertain amount of revenue and could well end up raising small amounts.

Sometimes, behavioral responses to taxes that reduce the revenue they raise are socially useful. For example, when cigarette taxes lead to reduced smoking or even when workers facing higher taxes are able to voluntarily substitute more leisure for work. But the behavioral response to EAFs that lowers the revenue gained from them also directly inflicts harm on low-wage workers.

There are better alternatives for the policy goals of EAFs

The recent pushes to use EAFs come from very good impulses: the desire to force employers to pay more and stop defecting on the social contract, and the desire to raise revenue so that states can buffer their residents from the terrible coming effects of the OBBB.

But there are better alternatives to achieve these goals. To raise wages, higher minimum wages are an obvious first step. A second step is policy changes that better enable willing workers to form unions and bargain collectively, even in the face of steep employer resistance. Policymaker inaction has largely destroyed the fundamental right of association in much of the U.S. labor market. Reversing this would, in the long run, solve many of the problems of employer behavior that EAFs are trying to target.

There are also better sources to raise reliable revenue to buffer residents from the OBBB’s steep cuts. If the desired target for these revenue increases is employers, higher corporate income taxes or higher employer-side payroll taxes (for all workers) could be used. Another revenue source specifically targeted at low-road employers could be increasing penalties for firms based on the number of their employees who are not covered by employer-sponsored health insurance through the workplace. This is not a huge tax base, but it is by definition larger than just employers with workers receiving Medicaid, as it would also include workers with no coverage at all. Further, this tax would incentivize the provision of ESI to more workers, a good thing in itself.

Most people understand a basic truth: you get what you pay for. Skip maintenance on your roof, and you shouldn’t be surprised when leaks appear.

The same is true of government. If we want a high-functioning public sector—and we should—there is no shortcut. It requires sustained investment in the people and capacity that make government work. Starve it of resources, and its performance will inevitably suffer.

In a recent New York Times essay, academics Nicholas Bagley and Robert Gordon argue otherwise. In their telling, government underperforms because public-sector unions have too much power, driving up costs and resisting efficiencies. Their solution is simple: rein in unions and invest less—largely by cutting pay for public-sector workers. It’s a tidy story that promises an easy fix.

It is also economically incoherent.

The central constraint on public-sector performance is not the power of unions—it is chronic underinvestment. For decades, policymakers have allowed public-sector pay and prestige to fall behind comparable private-sector jobs and have outsourced key functions that should have been performed by skilled civil servants, not profit-maximizing private contractors that are the real source of excess costs for state and local governments. The predictable results have been staffing shortages, uneven service quality, and degraded state capacity—not because we are paying too much, but because we have been trying to get government on the cheap.

Start with the most basic implicit claim Bagley and Gordon return to again and again: that public-sector unions have extracted excessive compensation and resisted efficiencies at every turn. If that were true, we would expect to see the total compensation of public-sector workers rising as a share of the overall economy. In fact, the opposite has happened—the combined compensation of public employees has shrunk noticeably as a share of national income for the last quarter century.

To be sure, policymakers should always aim to deliver value for taxpayers. And—just as in the private sector—there are surely instances where some public employee’s pay is out of line or workers resist useful improvements. But if overpayment for services delivered inefficiently was a general feature of the public sector, their aggregate compensation wouldn’t be shrinking sharply over time.

Bagley and Gordon support their claims with a shotgun blast of anecdotes about public-sector unions able to muscle excess pay out of colluding Democratic politicians that are almost laughably context-free. L.A. Mayor Karen Bass gave larger-than-normal raises to public-sector employees in 2024? I’d hope so—prices had risen 23% in the previous five years (this inflation had made some news) and private-sector pay for non-supervisory employees was up 28% over that time. The suggestion by Bagley and Gordon that these raises were untoward only makes sense if you actively want the desirability of public employment to crater relative to the rest of the economy.

Bagley and Gordon also note darkly that “more than half” of local government expenditures are paid to employees. So what? Local government spending is not like federal government spending where the overwhelming majority of it is simple transfer payments—sending checks to people (Social Security) and medical providers (Medicare and Medicaid). Local governments must directly deliver public goods and services, like public education. That’s going to be done by people who need to be paid. The private sector, too, devotes the majority of its spending to labor (in the corporate sector, labor’s share is well over 70%.)

Even the data they cite for this irrelevant point show that compensation—including the benefits that Bagley and Gordon decry—in state and local jobs is lower than for similar workers in the private sector. That gap matters. Public-sector employers must compete in the same labor markets as everyone else, and low relative pay for skilled workers in the public sector compromises the ability of public-sector employers to attract and retain highly effective workers.

This ignorance of how labor markets in the private and public sectors interact is the root of many of Bagley and Gordon’s economic misunderstandings.

Consider their discussion of education spending, where they note that California spends more per pupil than Mississippi. California does spend more per pupil in nominal dollars, but prices in California are far higher than in Mississippi. Even more importantly, private-sector salaries for college-educated professionals in California are much higher than in Mississippi—and those are the jobs that set the outside options that talented college graduates weigh when deciding whether to enter and remain in teaching. Put another way, it is competition from the private sector that determines how high pay must be to attract and retain high-quality teachers. Education researchers know this, and that’s why the generally accepted way to assess the sufficiency of education spending is not nominal dollars spent per pupil, but per pupil spending scaled to per capita GDP in a state. In forthcoming work we show that on this measure, California ranks 36th in the nation—lower than Mississippi.

This also shows why the Bagley and Gordon claim that “…blue states and cities often also pay state and local government workers more than similar jobs pay in red jurisdictions, even after adjusting for the cost of living” misses the point so spectacularly. State and local governments are embedded in their local economies and public-sector pay has to rise in line with private-sector pay in the economy around them, or the quality and quantity of available public employees will suffer.

The big problem over recent decades is that public-sector pay has not kept pace with the surrounding economy, which has made it harder to recruit and retain qualified workers. Teacher shortages, for instance, stem directly from the huge gap that has emerged in recent decades between what public school teachers earn and what comparable private sector workers earn, even in the highest-spending states. How would making these jobs lower-paying and lower-prestige add excellent new teachers and improve educational outcomes?

Another common complaint about the public sector is that it slows infrastructure projects. The public is often invited to imagine huge teams of paper-pushing bureaucrats gleefully stamping “no” on planning documents. But the clearest finding in empirical research about the drivers of higher-cost infrastructure is that costs have risen fastest where states reduced the number of transportation department employees. Fewer public-sector workers means that more of the planning work has been outsourced to more expensive private consultants.

Bagley and Gordon claim that when policymakers bargain with public-sector unions, there is no constraint on their incentives to grant union demands in exchange for electoral support. In reality, there is a crushing countervailing constraint—the overwhelming perception that voters are rabidly anti-tax. This results in a deep reluctance by policymakers to call for the level of revenue needed for public sector excellence. It is a far bigger structural problem today than any supposed excess power of public-sector unions.

Public-sector workers don’t just bear the brunt of underinvestment, they are also one of the few consistent voices arguing for robust financing of state and local governments, bargaining directly for the public good. They advocate for libraries to remain open in rural communities so that everybody has at least some access to the internet, for higher levels of K–12 education spending, and for proper training for EMTs and other first responders to ensure public safety.

Despite these efforts, public sector financing has been throttled in recent decades, and the results have been a predictable degradation of services. Even worse is coming, as the Republican tax and spending megabill will impose crushing cuts to safety net programs that states administer and jointly fund.

For decades we have been relying on the admirable intrinsic motivation of public employees to shield us from some of the damage of underinvestment—nurses, first-responders, and teachers going above and beyond the strict demands of their jobs to provide services they feel called to perform. But we’ve already asked too much while paying too little. If we want a truly excellent public sector—and we should—we need to pay for it.

Sophie Baker of Pensions & Investments reports liquidity focus pays off for Ontario Teachers’ as dual CIOs mark two-year milestone:

It’s been two years since the Ontario Teachers’ Pension Plan restructured its leadership team, appointing two people to oversee investments — and despite some major changes and challenges in global markets, the so-called dual CIOs haven’t made any knee-jerk reactions. 

Rather, the focus for the two has largely been creating liquidity in the C$269.6 billion ($197 billion as of June 30) portfolio. 

"We have been quite proactive in terms of generating liquidity on the private asset side, and seen some good success there, particularly in the market," Stephen McLennan CIO-asset allocation, said in an interview. "We're in position now where we would like to deploy into attractive opportunities and continually assess what the right balance is between passive and active to generate active returns." 

"We also want to spend a lot of time focusing on the more technical definition of liquidity, how we manage the balance sheet, what we need for margin calls and making sure we have the flexibility in the portfolio across the markets," he said. 

McLennan and Gillian Brown, CIO-public and private investments were named CIOs in January 2024 by CEO Jo Taylor. Their appointments split the role previously held by Ziad Hindo (now senior advisor at Bridgewater Associates), separating the responsibilities of the position, and Taylor has dubbed them dual CIOs, each with distinct lanes of responsibility, they said. Among the so-called Maple 8 of Canada's largest public pension funds, OTPP is the only with this structure.

The thinking behind splitting the role was to acknowledge a changing world with more geopolitical conflict, greater focus on inflation and central banks, disjointed activity in markets, and disruption to business models, they said.

Taylor looked into how to "lean into value creation, thinking strategically about those businesses and how we go forward," Brown said in the same interview. "It was existential, almost a bandwith questions to involve CIO operating model."

Brown -- previously head of capital markets, who joined in 1995 -- oversees the public and private investment functions, covering equities, infrastructure and natural resources, venture growth, real estate and capital markets investment departments. 

McLennan oversees the overall asset allocation mix, with an eye on total fund performance and management portfolio risk. He's also responsible for the liquidity management, investment allocations and portfolio optimization. McClellan most recently oversaw total fund management comprising the portfolio construction, treasury funding and global trading capabilities, and joined the pension fund in 2003.

Between them, they're running a 475- person investment team. They overlap in a few areas. Two such examples are Europe, Middle East and Africa coverage and Asia Pacific. While both regional teams report to McClellan, they are more active in nature, so in line with Brown's responsibilities, they said. Ass of December 31 2024, 70% of total investments were EMEA and 8% in APAC.

"It's nice for me having a trusted partner," Brown said. Added McLennan: "It's good to have somebody you can trust also deals off challenging -- as well as positive -- circumstances." 

Challenging period since appointments as dual CIOs

Although the executives haven't made any "knee-jerk" moves in the portfolio in response to challenging global markets and powers, that's not to say they haven't had a lot to think about. 

For McLennan and Brown the US administration that came into power in January 2025 has been top of mind with market movements as President Donald Trump unveiled a raft of tariffs, an example of key consideration. However, the portfolio has been steady in light of that volatility, they said. One-third of the gross investments were in the US as of December 31 2024,

"We need to be on top of that since it has impacted global markets, which impacts all the portfolios. McLennan said. "Areas we have been spending some time on equity markets-- public and private fixed income in terms of both interest rates in the US and globally; currencies and commodities we are trying to digest and think through what the new administration means, not only this year, but for the years to come." 

The CIOs have also been cognizant of the need for diversification and when to start looking beyond the US in terms of equity performance that's been dominated by technology stocks. 

"Many are talking including ourselves, about diversification? Are we getting full diversification? Given the equity index is driven by a few names, it's a trend that has been beneficial for all investors, particularly non US investors. But is that going to continue forever?" McClellan said. "It doesn't mean that it's going to end, but at some point, there are valuations and other things we should be cognizant of." 

The fund achieved a 2.1% net return on investments for the six months ended June 30 with the total fund returns driven by public assets. Its asset mix of June 30 was 37% equity, including public and private equity and venture growth. 24% fixed income, 20% inflation, sensitive assets, commodities, natural resources, inflation edge. 24% real assets, real estate and infrastructure, 30% credit and 10% absolute return strategies, the asset mix includes 28% in funding and other assets such as overlays, the five-year and 10-year annualized net returns were 7.5% and 6.9 % respectively. 

Evolving private markets thinking and approaches

OTPP has been looking at where to be a direct investor and to have a more governance and control over private equity holdings, and when to partner with others. The fund's private equity allocation was 21% as of June 30.

"My view is, it doesn't make sense to have really dogmatic approach, and it's more about understanding what we are good at." Brown said. "The partnership question is interesting. Some investors use it to think 'fund- plus-partner'. We want to be humble about where we need more expertise, such as in sectors that require really specialized knowledge. Therefore we pick the right partners to work with on those assets." 

OTPP has always had assets that it co-owns without necessarily having a fund relationship, and has also always "had a lot of partners throughout the portfolio; so it's more about making sure we unlock the right ones to find the right tool for the situation," she added. 

Within its venture growth portfolio, which had C$10.4 billion in net assets as of December 31 2024, 42% was direct investments in North America-based assets, 21% in direct APAC investments, 13% in direct EMEA investments, and the remaining 24% was in funds. 

The fund paused private investment activities in China in early 2023 and more recently, made the difficult decision to close its Hong Kong office. The majority of the staff relocated to Singapore and Asia-Pacific region as a whole remains important. Brown said, with private equity, infrastructure and venture growth teams active in the region. 

At the same time, Bloomberg reported that the Hong Kong office was closed as OTPP optimized its footprint in the region, having added Singapore, Mumbai offices. The team in Hong Kong primarily focused on outward markets -- including Australia, Japan, South Korea -- and the spokesperson said activities could be effectively and efficiently served out of Singapore.

Executives have also been talking about where they see growth opportunities. "I think India has become more of a focus for growth in that context, as a market that is still maturing with good depth of capital markets." Brown added. 

And while the major portfolio changes haven't been in the cards for the dual CIOs, they have made a key addition to their private markets capabilities amid ever-changing investment pacing and exit environments and the increasing importance of accountability and monitoring. In that context, McLennan and Brown said 

In January 2025, OTPP created its portfolio solutions group, a team of 37 people, monitoring and enhancing performance, improving best practice and providing more centralized value creation oversight in a single cross-asset function. About 80% of OTPP's portfolio is actively managed and private markets accounts for a large proportion of that total. 

The team is staffed with existing OTP members, led by Executive Managing Director Kevin Kerr, and works with deal teams on underwriting at point of entry, assists with variations and perspectives, refreshing value creation plans ahead of exits, helps deliver on key performance indicators and gets involved in an asset when it's not performing versus expectation. 

"They have been identifying the important areas where we want deeper subject management expertise, for example, talent management, new relationships, capital market access for technology and data opportunities," McClellan said. "In a world where realizations globally have slowed down, (and) we're owning assets for a longer period, we're making sure the holding period gets more attention, not less." 

The team also brings an impartial view on assets. "At Teachers', we believe challenge is a healthy thing," Brown said. "People can fall in love with them, with assets that they hold, so it's good to have external person say, is that really a good process, a good holding?" 

This is a really great in-depth article which I wanted to share with my readers.

It not only provides a glimpse into the dual-CIO structure at OTPP, how it works, their respective functions, but also how they collaborate with each other and across asset classes, leveraging off external partners and making sure internal teams stick to their value creation plan.

Gillian Brown has been around OTPP for a very long time (since 1995), has worked with some great CIOs (Bob Bertram, Neil Petroff and Ziad Hindo) and she knows her stuff across public and private markets.

Stephen McLennan has also been there since 2003 and he was in charge of total fund management prior to becoming CIO, Asset Allocation. His group has to think more macro and how to extract the most out of the total fund to deliver on their objectives.

The  dual CIO structure has been tried before -- at AIMCo where it unfortunately failed--  but in this case, I really think Gillian and Stephen complement each other well and they're making it work.

Jo Taylor isn't an easy boss, he has high expectations from them and other senior executives and so it all has to work or else he"d be the first to pull the plug.

And the Portfolio Solutions team which Kevin Kerr manages is critically important in this process, they really need to realize on value creation, see when dispositions make sense, and work on assets that need to be worked on. 

One thing Teachers' does well is leverage off its partners, be it in private equity, venture, hedge funds, infrastructure, real estate to really get a good sense of what is going on in each asset class.  

Alright, I'm going to wrap it up there, make sure you read the latest news at OTPP here. 

I will soon be covering OTPP's 2025 results and look forward to catching up with Gillian, Stephen and Jo.

Below, the CNBC Investment Committee debate the software sector as Stephanie Link and Malcolm Ethridge makes some moves in the space. 

Also, Dan Niles, founder of Niles Investment Management, offers a measured view of the stock sell-off driven by concerns over AI disruption, saying companies perceived as linked to OpenAI were caught up in an unsustainable wave of speculative buying. 

I don't know, as I stated last Monday, it's time to nibble on software stocks, I think AI disruption fears are running amok. 

Bondi Sands Self Tanning Instructions: A Comprehensive Guide

Achieve a sun-kissed glow with Bondi Sands! This guide details preparation, application, and aftercare, ensuring a flawless, natural-looking tan every time, starting today.

Bondi Sands has rapidly become a global leader in self-tanning, celebrated for delivering a beautiful, natural-looking tan inspired by the iconic Australian beaches. Their formulations are designed to cater to all skin tones and experience levels, from beginners seeking a subtle glow to tanning enthusiasts desiring a deeper bronze. The brand’s commitment to quality and ease of use has made it a favorite among beauty influencers and everyday users alike.

Unlike traditional tanning methods, Bondi Sands self-tanners offer a safe and convenient alternative to sun exposure, minimizing the risk of harmful UV damage. The range includes foams, lotions, and gradual tanning milks, each formulated with nourishing ingredients to hydrate and condition the skin while developing a stunning tan. Preparing your skin correctly and following the application instructions are key to achieving optimal results and avoiding common tanning mishaps.

This comprehensive guide will walk you through every step of the Bondi Sands tanning process, ensuring you achieve a flawless, salon-quality tan in the comfort of your own home.

Understanding Bondi Sands Product Range

Bondi Sands offers a diverse range of self-tanning products designed to suit various preferences and skin types. Their core collection features Aerated Self Tanning Foam, known for its lightweight texture and quick-drying formula, providing a streak-free application and a natural-looking tan. Alongside the foam, Bondi Sands provides classic Lotions, offering deeper color development and intense hydration – ideal for drier skin.

For those seeking a more subtle and buildable tan, the Gradual Tanning Milk is a perfect choice. This product gradually develops color with each application, allowing you to customize your desired level of bronze. The range also includes specialized products like exfoliating mitts and application mitts, designed to enhance the tanning experience and ensure optimal results.

Understanding the differences between these formulations is crucial for selecting the product that best aligns with your tanning goals and skin needs, ultimately leading to a flawless and satisfying self-tan.

Bondi Sands Aerated Self Tanning Foam

Bondi Sands Aerated Self Tanning Foam is a flagship product, celebrated for its incredibly lightweight and airy texture. This innovative formula allows for effortless application, spreading smoothly and evenly across the skin without feeling sticky or heavy. The aerated consistency ensures rapid absorption, minimizing transfer onto clothing and bedding.

The foam’s unique formulation contains nourishing ingredients that hydrate the skin while developing a natural-looking tan. A key benefit is the built-in guide color, which provides instant visual feedback, ensuring complete coverage and preventing streaks. It’s particularly beginner-friendly due to this feature, making self-tanning less intimidating.

Available in various shades, the Aerated Foam caters to diverse skin tones, allowing everyone to achieve their desired level of bronze. It’s a popular choice for those seeking a quick-drying, streak-free, and naturally radiant tan.

Bondi Sands Lotion vs. Foam

Choosing between Bondi Sands Lotion and Foam depends on your preference and skin type. The lotion offers a more gradual tan development, ideal for those wanting a subtle glow or maintaining existing color. It’s deeply hydrating, making it suitable for dry skin, and allows for precise application, particularly on areas prone to dryness like elbows and knees.

Conversely, the foam provides a faster, more intense tan. Its lightweight texture is perfect for normal to oily skin, minimizing the feeling of stickiness. The foam’s quick-drying formula reduces transfer risk, making it convenient for busy schedules. The built-in guide color aids in even application, preventing streaks.

Ultimately, foam is often recommended for beginners due to its ease of use and visible results, while lotion suits those desiring a more controlled, moisturizing tanning experience.

Bondi Sands Gradual Tanning Milk

Bondi Sands Gradual Tanning Milk is designed for daily use, building a subtle, natural-looking tan over time. Unlike instant foams or lotions, it provides a customizable glow, perfect for those new to self-tanning or wanting to maintain an existing tan. This milk is incredibly hydrating, enriched with aloe vera and vitamin E, leaving skin feeling soft and nourished.

Application is simple: apply evenly to clean, dry skin, just like a regular moisturizer. Reapply daily for a deeper tan, adjusting the amount based on your desired intensity. It’s a fantastic option for all skin types, especially those with sensitive skin, as it minimizes the risk of streaks and unevenness.

Remember to exfoliate regularly for optimal results and to maintain an even fade. This milk is your secret weapon for a year-round, healthy-looking glow!

Pre-Tanning Preparation: Essential Steps

Proper preparation is key to achieving a flawless Bondi Sands tan. Begin with thorough exfoliation to remove dead skin cells, creating a smooth canvas for even application. The Bondi Sands Exfoliation Mitt is ideal for this, gently buffing away impurities and promoting a longer-lasting tan. Don’t skip this step – it prevents patchiness and ensures optimal color development!

Consider your hair removal routine. Shaving or waxing should be done at least 24 hours before application to avoid irritation and uneven tan absorption in freshly sensitized skin. Immediately before applying your Bondi Sands tanner, avoid applying regular moisturizers, body oils, or lotions. These create a barrier, hindering the development of the tan.

A clean, dry, and hydrated (but not moisturized) base is the perfect starting point for your self-tanning journey.

Exfoliation: Using the Bondi Sands Exfoliation Mitt

The Bondi Sands Exfoliation Mitt is your first step to a streak-free, long-lasting tan. Unlike harsh scrubs, the mitt gently yet effectively removes dead skin cells, revealing a smooth surface for optimal product absorption. Wet the mitt thoroughly in the shower and use circular motions, working your way from your feet upwards.

Pay extra attention to areas prone to dryness, such as elbows, knees, and ankles. Don’t rush this process; spend a good 2-3 minutes exfoliating your entire body. This ensures even tan development and prevents patchiness. Rinse off any exfoliated skin and pat your skin dry with a towel.

Remember, exfoliation isn’t just for pre-tan prep; maintaining regular exfoliation post-tan will help your tan fade evenly, extending its life!

Shaving or Waxing Considerations

Timing is crucial when it comes to hair removal before applying Bondi Sands self-tanner. To achieve the best results and avoid irritation, complete any shaving or waxing at least 24 hours before your tanning session. This allows your skin to calm down and any open pores to close.

Freshly shaved or waxed skin is more porous and can absorb more tanner, potentially leading to a darker, uneven result, or even temporary spotting. Waiting a full day minimizes this risk. If you must shave on the day of application, do so well in advance and rinse thoroughly, ensuring no razor burn or irritation remains.

Prioritizing skin health ensures a flawless, natural-looking tan. Remember, patience is key for a beautiful, sun-kissed glow!

Moisturizing – What to Avoid Before Application

Hydrated skin is important, but avoid applying any moisturizers, lotions, or oils for at least 24 hours before your Bondi Sands self-tan application. These products create a barrier on the skin, preventing the tanning agents from properly absorbing and developing a natural-looking color.

This barrier can lead to streaking, unevenness, and a tan that simply doesn’t last. While daily moisturizing is essential for healthy skin, it’s best to skip it immediately before tanning. If you have naturally dry skin, a light exfoliation (using the Bondi Sands Exfoliation Mitt) is preferable to moisturizing.

Focus on prepping your skin with exfoliation to remove dead skin cells, creating a smooth canvas for the tan. Remember, a clean, dry, and oil-free base is vital for optimal results!

Application Technique: Achieving a Flawless Tan

Mastering the application is key to a streak-free, natural-looking Bondi Sands tan. Begin with the Bondi Sands Application Mitt – it’s your best friend! Pump a moderate amount of foam directly onto the mitt; start with less, you can always add more.

Using long, sweeping motions, blend the foam onto your skin, working in circular movements. Avoid rubbing vigorously. Ensure even coverage, overlapping slightly as you go. Work section by section – legs, arms, torso – to maintain control and avoid missing spots.

Remember to apply in a well-lit area to visually confirm complete coverage. The guide color will assist in seeing where you’ve applied product. Don’t stress about perfection; the mitt helps distribute the tan evenly, minimizing streaks and maximizing a beautiful, bronzed result.

Using the Bondi Sands Application Mitt

The Bondi Sands Application Mitt is essential for a flawless, streak-free tan. This velvety mitt acts as a barrier, protecting your palms from staining and ensuring even product distribution. Before each use, ensure the mitt is clean and dry for optimal performance.

To use, simply slide your hand inside the mitt. Pump a small amount of Bondi Sands self-tanner directly onto the mitt – starting with less is always best! The mitt’s texture allows for controlled application, preventing over-saturation and minimizing the risk of dark patches.

Employ long, sweeping motions, blending the product into your skin. The mitt’s design helps buff the tan, creating a natural-looking finish. Remember to wash the mitt after each use with mild soap and water, allowing it to air dry completely before storing.

Foam Application: Amount and Motion

Begin with a small amount of Bondi Sands foam on your application mitt – approximately a golf ball size for each limb. Remember, you can always add more, but removing excess is difficult! Utilize long, sweeping motions, working in circular patterns to blend the foam evenly across your skin.

Avoid applying too much pressure, as this can lead to streaking. The guide color will help you visualize coverage, ensuring no areas are missed. Work quickly and systematically, section by section, to maintain an even application.

Focus on blending the foam thoroughly into the skin, paying attention to areas prone to dryness, like elbows and knees. Consistent, fluid motions are key to achieving a natural, sun-kissed glow. Don’t forget to blend down towards the wrists and ankles to avoid harsh lines!

Application to Specific Areas (Elbows, Knees, Hands, Feet)

These areas require a lighter touch! For elbows and knees, apply a very small amount of foam to your mitt and blend it out thoroughly, as these areas tend to absorb more product. Use even less product on your hands and feet – a tiny amount is sufficient;

When applying to hands, blend the foam onto the back of your hands first, then gently blend onto the palms, ensuring you get between your fingers. For feet, apply to the tops and sides, avoiding the soles.

Immediately after application to hands and feet, use a damp wipe or a clean, damp mitt to remove any excess product from your palms, knuckles, ankles, and toes to prevent overly dark areas. Remember, less is more with these tricky spots!

Development Time & Rinse Off

Allow the Bondi Sands self-tan to develop fully for optimal results. The recommended development time is between 2 to 8 hours, depending on your desired depth of tan – longer for darker results. Avoid applying any clothing during this period to prevent staining.

Once the development time is complete, it’s time to rinse! Use lukewarm water and gently massage your skin in circular motions to evenly remove the guide color. Do not use soap, shower gel, or exfoliants during the initial rinse, as this can hinder the tan’s development.

Continue rinsing until the water runs clear. Pat your skin dry with a soft towel – avoid rubbing. Your tan will continue to develop over the next 24-48 hours, deepening into a beautiful, natural-looking glow.

Recommended Development Time

The ideal Bondi Sands development time hinges on your desired tan intensity. For a light golden glow, a development period of 2-3 hours is sufficient. If you’re aiming for a medium tan, allow the product to work its magic for 4-6 hours. For those desiring a deep, bronzed look, leave it on for the full 8 hours – or even overnight!

Remember, the longer you leave the tan on, the darker it will become. It’s always best to start with a shorter development time and build up the color gradually in subsequent applications; Avoid any activities that might cause excessive sweating during development, as this can affect the evenness of the tan.

Prior to rinsing, ensure you’ve allowed the full recommended time for optimal color development and a flawless finish.

Rinsing Technique for Optimal Results

Rinsing is crucial for revealing your Bondi Sands glow! Begin with lukewarm water – avoid hot water, as it can strip the tan. Gently rinse off the guide color, using circular motions and avoiding harsh scrubbing. Don’t use any soap, shower gel, or exfoliants during this initial rinse; water alone is best.

Continue rinsing until the water runs clear. Pat your skin dry with a soft towel, avoiding vigorous rubbing. Resist the urge to moisturize immediately after rinsing; allow your skin to fully dry for optimal color development. This allows the tan to fully oxidize and reach its deepest, truest shade.

Proper rinsing ensures an even, streak-free tan and maximizes longevity.

Post-Tan Care: Maintaining Your Glow

Extend the life of your Bondi Sands tan with proper aftercare! Hydration is key – moisturize daily with a lightweight, oil-free lotion. This replenishes skin’s moisture barrier and prevents the tan from fading unevenly. Avoid harsh soaps, body washes containing sulfates, and exfoliating scrubs, as these can accelerate tan removal.

When swimming, chlorine can quickly diminish your tan, so apply a waterproof sunscreen. Similarly, prolonged sun exposure without protection will fade your color. Pat your skin dry after showering or swimming, rather than rubbing.

Consistent moisturizing and gentle care will keep your Bondi Sands glow radiant for longer, ensuring you look and feel fabulous!

Moisturizing After Tanning

Replenish and protect your newly tanned skin with consistent moisturizing! After your Bondi Sands tan has fully developed and been rinsed, applying a hydrating lotion is crucial. Opt for a lightweight, oil-free formula to avoid stripping the tan or clogging pores. Focus on areas prone to dryness, like elbows, knees, and ankles.

Moisturizing doesn’t just prolong your tan; it also keeps your skin healthy and supple. Dry skin will cause the tan to fade unevenly and quickly. Apply lotion daily, ideally after showering, when your skin is most receptive.

Consider lotions specifically designed for tan maintenance, often containing ingredients to lock in color and provide extra hydration. A well-moisturized skin equals a longer-lasting, beautiful Bondi Sands glow!

Avoiding Harsh Soaps and Exfoliants

Protect your Bondi Sands tan by steering clear of harsh skincare products! Immediately after rinsing off your self-tanner, and for several days afterward, avoid soaps containing sulfates, alcohol, or strong fragrances. These ingredients can strip away the tan and leave your skin feeling dry and irritated.

Similarly, refrain from vigorous exfoliation. While exfoliation is essential pre-tan, it’s your tan’s enemy post-application. Aggressive scrubbing or using exfoliating tools will accelerate fading and create patchiness. Gentle cleansing is key.

Opt for mild, hydrating body washes and continue regular moisturizing to maintain your glow. Delay any further exfoliation for at least a few days, allowing the tan to fully develop and fade naturally. A little care extends your beautiful Bondi Sands results!

Troubleshooting Common Tanning Issues

Don’t panic if your Bondi Sands tan isn’t perfect! Streaking often occurs from uneven application or insufficient blending; re-apply a light layer to affected areas, blending thoroughly with a mitt. For an uneven tan, gentle exfoliation can help even out the color, followed by a re-application.

Orange tones usually result from leaving the tan on for too long or using too much product. Hydrate skin intensely and consider a gradual tan remover if the color is too intense. Remember, less is more!

Always patch test a small area first. If issues persist, consult Bondi Sands’ website for specific product advice. Proper preparation and aftercare significantly minimize these problems, ensuring a flawless, natural-looking tan.

Streaky Tan Solutions

Encountering streaks with your Bondi Sands tan? Don’t worry, it’s easily fixable! The most common cause is uneven application or inadequate blending during the initial process. To remedy this, gently re-apply a very light layer of Bondi Sands self-tanner specifically to the streaky areas.

Crucially, blend this second application meticulously with your Bondi Sands Application Mitt, using sweeping circular motions. Ensure you’re blending into the surrounding tanned skin, not just over the streaks. Avoid applying a thick layer, as this can worsen the problem.

Allow to develop for a shorter period than the original application, and rinse thoroughly. Prevention is key – always exfoliate and moisturize before application!

Uneven Tan Correction

Dealing with an uneven Bondi Sands tan can be frustrating, but it’s often easily corrected. The primary cause is typically inconsistent application, often due to drier areas absorbing more product. To address this, gentle exfoliation is your first step – focus on the darker areas to lightly reduce the tan intensity.

Next, apply a very light layer of Bondi Sands self-tanner to the lighter areas, blending seamlessly with the existing tan using your Application Mitt. Remember to use circular motions and avoid harsh lines. Allow a shorter development time than your initial application, monitoring the color closely.

Rinse thoroughly and moisturize. Consistent exfoliation and hydration between applications will help prevent future unevenness!

Dealing with Orange Tones

An orange tint after Bondi Sands tanning usually indicates over-application or insufficient exfoliation. The key to avoiding this is proper preparation and following the recommended development time. If you’ve already developed an orange hue, don’t panic! Immediate action can help.

Begin with a gentle, full-body exfoliation using the Bondi Sands Exfoliation Mitt, focusing on areas with the most intense color. This will help lift the excess DHA responsible for the orange tone. Follow this with a baking soda paste (mix baking soda with water) applied to the affected areas for a few minutes before rinsing thoroughly.

Moisturize deeply afterward. For future applications, use less product and ensure thorough exfoliation beforehand. Remember, a gradual tan is always preferable to a drastic one!

Bondi Sands Tanning FAQs

Q: How long does a Bondi Sands tan last? A: Typically, 5-7 days with proper aftercare, including regular moisturizing;

Q: Can I tan if I have sensitive skin? A: Yes, but perform a patch test 24 hours prior. Bondi Sands offers products formulated for sensitive skin.

Q: Will Bondi Sands stain my clothes? A: While the guide color washes off, wear loose, dark clothing during development.

Q: Can I apply Bondi Sands on my face? A: Yes, but use a lighter application and avoid the eye area. Bondi Sands also has specific facial tanning products.

Q: What if my tan is streaky? A: Exfoliate and reapply with a lighter hand, ensuring even coverage.

Q: Is Bondi Sands cruelty-free? A: Yes, Bondi Sands is proudly cruelty-free and vegan-friendly.

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Nicolas Van Praet of the Globe and Mail reports Caisse posts 9.3% return in 2025 on gains from stock holdings:

Caisse de dépôt et placement du Québec tallied an 9.3-per-cent return last year as gains from stock holdings offset a neutral performance by real estate investments in an environment marked by ongoing trade strife, global conflict and the expansion of artificial intelligence across society.

Net assets stood at $517-billion at the end of 2025, up from $473-billion the year before, the Montreal-based pension fund manager said in a statement Wednesday. The annualized return over five years was 6.5 per cent.

“It’s really a new world order out there,” Caisse Chief Executive Charles Emond said in an interview, noting the power of AI-related themes over stock markets among other major shifts taking place. Investment diversification remains the key to delivering stable returns as the uncertainty persists, he said.

“The main risk we’re dealing with – and I would have never thought I’d say that during my career – is the U.S.,” Mr. Emond said. U.S. exceptionalism is still there, but it has eroded lately and “the level of trust” has been put to the test, he said. “It’s actually paid off to be invested elsewhere.”

The U.S. remains the deepest, most liquid and most attractive market for investors and the Caisse is not exiting the country, Mr. Emond insisted. But it is being more prudent in the way it invests there.

The pension fund pared back U.S. stock holdings last year while boosting credit activity. It also sold some U.S. office buildings while hedging more than usual on its U.S. dollar exposure. Roughly 40 per cent of its total assets are invested across the border.

The pension fund’s gain on equity market investments was 17.7 per cent for the year, the third best over the past decade, as it added to positions in other markets such as Europe and South Korea. Its infrastructure portfolio generated a 9.2-per-cent showing, driven by energy, ports and highway investments, while fixed income returned 6.6 per cent.

On the other end of the spectrum, the Caisse’s real estate holdings remained under pressure, delivering a 0.2-per-cent return as the market recovers. Private equity, usually a strong motor for the pension fund, generated a 2.3-per-cent gain as profit growth slowed for its portfolio companies and valuation multiples dropped in the technology and health care sectors.

The mixed results, which closely matched the previous year’s 9.4-per-cent return, highlight the magnitude of the challenges for Mr. Emond, a former Bank of Nova Scotia executive who took over as Caisse CEO in early 2020.

His tenure, which was recently extended to 2029, has been fraught with turmoil from the COVID-19 pandemic, record inflation, and wars in Ukraine and the Middle East. Donald Trump’s reclaiming of the White House has presented a new test: The President’s unpredictability has repercussions for trade and on the decisions of central bankers and corporate leaders.

The Caisse, which is independently run at arm’s length from the Quebec government, has a dual mandate to manage deposits with a view to achieving optimal returns while contributing to Quebec’s economic development. It is omnipresent in the province, investing in companies such as Alimentation Couche-Tard Inc. and WSP Inc. and pushing into transit development with Montreal’s $8-billion Réseau express métropolitain light-rail system.

Quebec Premier François Legault said last November that the Caisse “needs to do even more” to back local projects and business in the face of Mr. Trump’s trade war against Canada, which has hurt aluminum makers and forestry companies in the province. “I think the situation is critical right now,” the Premier said at the time.

The Caisse now has assets in Quebec topping $100-billion, a target it set three years ago. It hasn’t set a new goal, vowing instead to be “more intentional” on the impact of future investments in strategic sectors such as natural resources, defence and energy, Caisse executive vice-president Kim Thomassin told reporters at a news conference.

Among its biggest domestic deals in the past 12 months, the Caisse bought Innergex Renewable Energy Inc. for about $2.8-billion and struck a $1.3-billion deal with Telus Corp. for a minority stake in a new cellphone tower spinout called Terrion. It also made a US$100-million equity investment in Champion Iron Ltd to support the miner’s acquisition of Norway’s Rana Gruber SA.

Earlier this month, the pension fund briefly suspended its deal-making with DP World Ltd. in the wake of revelations linking the chairman and chief executive of the logistics multinational to disgraced financier Jeffrey Epstein. It has since resumed working with its long-standing partner after the executive resigned. 

The only thing I will mention about this Epstein thing is the head of global ports operator DP World has left the company after mounting pressure over his links to convicted sex offender Jeffrey Epstein.

The Caisse briefly suspended its operations after discovering this and has since resumed them. Obviously they had no idea Sultan Ahmed bin Sulayem exchanged hundreds of emails with Epstein.

Anyway, today is a very big day because La Caisse posted its results and despite weakness in private equity and ongoing issues in real estate, they were solid powered by public equities, credit and infrastructure. Its Quebec portfolio also did well.

Now, this morning I virtually assisted the press conference from the comforts of my home and took a quick image of Charles Emond, Kim Thomassin and Vincent Delisle (at top of this post).

I must admit, that was the first time I virtually assisted this press conference and to my surprise, I thoroughly enjoyed it, thought Charles, Kim and Vincent did a great job and the slides which you will see below gave a perfect overview.

Typically I find these press conferences dreadfully boring and tiresome but this one was very well done, and for the most part, reporters asked decent questions and I told Charles, Kim and Vincent afterwards that they should post it publicly on their YouTube channel.

I'm not kidding, it was that good and if I was able to embed it, it would save me a lot of time explaining things.

One of the most important questions Charles tackled was why their underpeformance relative to benchmark over the last year (9.3% vs 10.9%) and whether it's worth investing in private markets.

Charles explained that they have a mandate from depositors to deliver returns taking risks into account and they have delivered strong gains over the long run by taking a diversified approach across public and private markets and this approach offers higher risk-adjusted returns. 

I'm paraphrasing but if I get the transcript in French, I will post it here and I thought that was extremely well answered. 

The only question I didn't like (it always irritates me) is how did La Caisse perform last year relative to its peers. Charles said their biggest client whose portfolio is closest to CPP Investments gained 9.8% last year which was better than CPP Investments' 7% return over last nice months and OMERS' 6% gain last year but we are comparing apples to oranges because the asset mixes aren't the same (CPP Investments and OMERS have more private market exposure).

There are so many factors that go into comparing returns across pension funds that I absolutely hate these questions and besides, they're all in great financial health, have way more assets than long-dated liabilities (and that's what ultimately counts, not outperforming each other). 

One year those that have more public market exposure will fare better, another those that have more private market exposure will fare better. Who cares? 

All of the Maple 8 funds underperformed Norway's sovereign wealth fund which gained 15.1% last year, it means absolutely nothing to me (all about asset mix!!).

Alright, let me get to this morning's press conference but before I do, some more articles in French:

•  La Caisse à la traîne pour une troisième année d’affilée
• La Caisse annonce un rendement de 9,3 % en 2025 
• Rendement de 9,3% pour la Caisse en 2025, sous la cible pour la troisième année consécutive 
• La performance de La Caisse pour 2025 a été en deçà des attentes 

Basically the French media is savage, La Caisse underperformed its benchmark for a third straight year, but overall performed well and beat OMERS (again, who cares?).

Morning Press Conference With Charles Emond, Kim Thomassin and Vincent Delisle

As mentioned above, I really liked this morning's press conference, so much so that I believe La Caisse should make it public and post it on YouTube as soon as possible (la transparence avant tout!).

Before I get to the slides, here is La Caisse's press release stating it posted a 9.3% return in 2025 and net assets of $517 billion:

• The depositor plans are in excellent financial health
• The base plan of the Québec Pension Plan, representing the pensions of more than six million Quebecers and the largest fund invested with La Caisse, earned a return of 9.8%
• The ambition of $100 billion invested in Québec achieved one year early

La Caisse today presented its financial results for the year ended December 31, 2025. The weighted average return on its 48 depositors’ funds was 9.3% for one year, below its benchmark portfolio’s 10.9% return. Over longer terms, performance is above the benchmark portfolio: over five years, the annualized return was 6.5%, with the benchmark portfolio at 6.2%; over ten years, it stood at 7.2%, against the benchmark portfolio’s 6.9%. As at December 31, 2025, La Caisse’s net assets totalled $517 billion.

In 2025, the environment was marked by geopolitical tensions and persistent tariff uncertainty. Nevertheless, the global economy proved resilient and stock markets once again posted a robust performance. Although central banks generally lowered their key rates, long-term bond yields moved in different directions, falling in the United States but rising in several other countries, including Canada.

“Last year, our overall portfolio posted a good return, with the right level of risk for our depositors. As public markets were particularly strong, they were the main driver of our annual performance. In an environment shaped by uncertainty and profound changes that are likely to persist, diversification remains essential, allowing each asset class to play its part across different market conditions,” said Charles Emond, President and Chief Executive Officer of La Caisse.

“Looking back at the past five years, markets have been volatile and difficult to follow, with pronounced differences between asset classes and sharp fluctuations from one year to the next. Having stayed the course with numerous transactions in key sectors around the world, the advancement of structuring projects in Québec, and the rollout of a new climate strategy even against strong headwinds, all while maintaining the excellent financial health of our depositor plans, are all reasons to be proud of the role and impact of this major institution for Québec,” he added.

Return highlights

As at December 31, 2025, La Caisse’s investment results totalled $43 billion for one year, $134 billion over five years and $245 billion over ten years.

Forty-eight depositors with different objectives

La Caisse manages the funds of 48 depositors—mainly for pension and insurance plans. The overall portfolio’s one-year, five-year and ten-year returns represent the weighted average of these funds. To meet their objectives, investment strategies are adapted to individual depositor risk tolerances and investment policies, which differ considerably.

For one year, returns for La Caisse’s nine largest depositors’ funds ranged from 8.6% to 10.4%. Over longer periods, the annualized returns varied between 4.6% and 7.8% over five years, and between 5.8% and 8.0% over ten years.

The largest fund invested with La Caisse, the base plan of the Québec Pension Plan, administered by Retraite Québec, posted a return of 9.8% for one year, 7.8% over five years and 8.0% over ten years. As at December 31, 2025, its net assets were $163 billion, including the additional plan.

Equities

Equity Markets: Beneficial geographic diversification

Stock markets experienced a year of rotation in 2025, with the U.S. market being perceived as more uncertain, and giving up ground to other stock markets, such as those in Europe, Canada and emerging countries. The latter benefited from good performances in a variety of sectors, including technology, as well as materials and finance. Sound geographic diversification, combined with the quality of execution by portfolio managers, enabled the Equity Markets portfolio to record a return of 17.7%, its third-best performance in ten years, and to outperform the index in the vast majority of mandates. The benchmark index stands at 18.2%. The difference over the period is mainly due to the more limited contribution of certain Québec stocks in the portfolio, as well as its low exposure to the gold segment, which grew sharply during the year.

Over five years, the annualized return was 12.4%, above the 12.1% return of the benchmark portfolio. Performance therefore outpaced the benchmark index despite growing concentration of gains in the main stock market indexes during the period. The portfolio benefited from the 2021 changes aimed to take advantage of technology stocks. The launch of systematic management strategies, which leverage data processing capabilities using augmented intelligence, has also had a significant positive impact.

Private Equity: Slower growth affects portfolio

In 2025, the Private Equity portfolio posted a 2.3% return. This was the result of slowing earnings growth for portfolio companies and lower multiples in the technology and health care sectors. Some investments, although performing well since the initial investment, experienced a setback and weighed on performance during the year, despite the good performance of companies in the industrials sector. The benchmark index, half of which is made up of public stocks, returned 12.6%, as public markets were much more robust than the private market.

Over five years, the portfolio has been one of the main drivers of overall performance, boosted by investments in the industrial, financial and technology sectors, delivering an annualized return of 11.6%. Over the period, the more moderate performance of a handful of stocks explains the difference with the portfolio’s performance relative to its index, which stood at 14.7%.

Fixed income

Credit activities are a strong vector of performance

The majority of the Fixed Income asset class is comprised of the Credit and Rates portfolios, with the latter serving as a source of liquidity for the overall portfolio. In 2025, the asset class generated a 6.6% return, above its benchmark index’s 4.6%. The Credit portfolio was a strong performance driver, with a return of 9.6%. It recorded its best ever performance against its index, which posted a 6.6% return, due to results obtained in the private segment, emerging market sovereign debt and the quality of execution by the teams.

Over five years, the asset class posted an annualized return of -0.2%, compared with a benchmark return of -1.1%. The good performance of the Credit portfolio over the period, driven by Capital Solutions and Corporate Credit activities, boosted the asset class, but failed to offset the impact from the strongest bond market correction in 50 years that occurred in 2022.

Real assets

Infrastructure: Consistent performance in diverse market environments

The portfolio has maintained its momentum of recent years, delivering a return of 9.2% in 2025. It benefited from an attractive current yield of 5.0% and the quality of portfolio assets. Energy, ports and highways were the largest contributors to performance. The benchmark index, made up entirely of public stocks, returned 13.4%. It was buoyed by the growth of companies in the electricity segment, which continues to be stimulated by the historic demand for artificial intelligence and weighs heavily in the index.

Over five years, the annualized return was 10.8%, outpacing the index’s 8.0% return. The portfolio continues to benefit from asset diversification, with the energy, transportation and telecommunications sectors leading the way, as well as from its strong current yield, across very different cycles over the period, marked in particular by higher inflation.

Real Estate: Progress on turnaround plan in an industry still under pressure

For one year, the portfolio posted a 0.2% return, compared with 1.8% for its benchmark index. In a gradually recovering market, direct portfolio assets in the logistics and residential sectors, as well as offices and shopping centres, posted a 4.4% return, a sign that rental incomes and property values are stabilizing. However, this return was offset by the high cost of financing. Lower performance of assets in China largely explains the difference with the index. It should be noted that the teams were particularly active in portfolio turnover, achieving a high transaction volume, totalling nearly $11 billion, or double the previous year’s figure.

Over five years, the portfolio’s annualized return was 1.2%, affected by its exposure to the office sector, which has been weakened by changes in working habits, but whose effects were mitigated by favourable performance in logistics. The benchmark index returned 1.4%, reflecting the challenges faced by the industry in recent years.

Global strategies that generate value

La Caisse’s teams also employ global strategies to optimize performance, including positioning on macro factors and foreign currency management:

• Macro tactical strategies contributed positively to overall portfolio performance in 2025, successfully navigating the volatility seen during the year, particularly in April with the unveiling of U.S. tariff policy, which prompted significant movement in global financial markets. These overlay activities, which are designed to improve the risk-return profile and enhance overall performance against the benchmark portfolio, have generated $1.2 billion in added value over one year.
• While the portfolio’s exposure to foreign currencies had an adverse impact on 2025’s overall performance due to the sharp depreciation of the U.S. dollar, the partial hedging of this currency put in place by the teams nevertheless protected $3.6 billion.

Québec: Ambition of $100 billion achieved ahead of schedule, with investments in local companies and impactful projects

In 2025, La Caisse’s assets in Québec reached $100.1 billion. The organization deployed $6.3 billion in new investments and commitments during the year.

Among the teams’ accomplishments, we note:

Support to grow companies in key sectors

• Innergex: Privatization of this renewable energy leader, bringing the enterprise value to $10 billion
• Boralex: $200-million financing, doubling existing debt financing in this company of which La Caisse has been a major shareholder for nearly ten years
• Honco Group: Minority interest to consolidate Québec ownership of this steel processing specialist
• Ocean Group: Additional investment in the context of the shareholder structure evolution of this maritime industry leader in Québec and Canada, bringing La Caisse’s stake to $120 million
• Germain Hotels: Lead of a $160-million financing round to accelerate its expansion and support the company’s succession

Structuring projects: An edge for Québec

• REM: Commissioning of the Deux-Montagnes branch, tripling the network’s coverage, with 19 stations spanning 50 km
• TramCité: Announcement of the six consortia qualified for two major contracts in the request for expressions of interest process, an important step in the procurement process for this 19 km tramway project in Québec City
• Alto Québec City-Toronto high-speed train: Cadence team, led by CDPQ Infra, selected as private partner by the Government of Canada and contract signed with the project authority
• Terrion: Transaction worth close to $1.3 billion to create, with Telus, the largest specialized wireless tower operator in Québec and to establish the head office in Montréal
• Laurentian Bank: Support for the acquisition transaction by National Bank and Fairstone Bank, through guarantees obtained to maintain Laurentian Bank’s commercial head office and to relocate Fairstone Bank’s head office to Québec
• AI expertise: Launch and implementation of a program powered by Vooban to support company productivity in the face of tariff challenges; recruiting for a new cohort currently underway

Climate: A new strategy for increased impact in all sectors of the economy

After exceeding the climate targets set in 2017 and then raised in 2021, La Caisse has developed a new strategy to accelerate the decarbonization of companies and significantly increase its investments linked to the energy transition by 2030, both in Québec and internationally. The objective remains: create sustainable value for depositors while managing the climate risks associated with its portfolio assets. La Caisse’s approach was well received by the Canadian group Shift: Action for Pension Wealth and Planet Health, which placed it first in its annual ranking.

By 2030, La Caisse aims to increase its Climate Action investments to $400 billion, in line with its commitment to carbon neutrality by 2050. This strategy is based both on investments in companies that clearly and credibly integrate climate issues into their business model, and on investments in climate solutions, i.e. companies, activities or technologies that help reduce carbon emissions. To find out more, visit this page or see the Sustainable Investing Report to be published in spring 2026.

Financial reporting

The costs incurred by La Caisse to conduct its activities include operating expenses, external management fees and transaction costs. In 2025, operating expenses decreased to 21 cents per $100 of average net assets, compared with 23 cents in 2024 and 26 cents in 2023. This significant reduction in the operating expenses over the past two years reflects the efficiency efforts made by the organization, particularly since the integration of its real estate subsidiaries. The total cost of internal and external investment management is 74 cents per $100 of average net assets as at December 31, 2025, compared with 67 cents in 2024 and 83 cents in 2023. Note that this figure varies depending on different factors, such as asset size, transaction volume and external management fees paid. Cost management remains a priority for the organization and, based on external data, La Caisse’s cost ratio is among the lowest in the industry.

The credit rating agencies reaffirmed La Caisse’s investment-grade ratings with a stable outlook, namely AAA (DBRS), AAA (S&P), Aaa (Moody’s) and AAA (Fitch Ratings).

About La Caisse

At La Caisse, formerly CDPQ, we have invested for 60 years with a dual mandate: generate optimal long-term returns for our 48 depositors, who represent over 6 million Quebecers, and contribute to Québec’s economic development.

As a global investment group, we’re active in the major financial markets, private equity, infrastructure, real estate and private credit. As at December 31, 2025, La Caisse’s net assets totalled CAD 517 billion. For more information, visit lacaisse.com or consult our LinkedIn or Instagram pages.

La Caisse is a registered trademark of Caisse de dépôt et placement du Québec that is protected in Canada and other jurisdictions and licensed for use by its subsidiaries. 

And here are the slides that accompanied the press conference this morning:

 

The slides provide a great snapshot of key activities by asset class and overall returns and along with the comments Charles Emond, Kim Thomassin and Vincent Delisle made during the press conference, I think they covered it all very well.

I would urge all of Canada's Maple 8 to do the same thing and post your press conferences on YouTube just like Norway's NBIM does. 

I'll give La Caisse's Communications department an A for this press conference (A+ if they post it on YouTube). 

Discussing 2025 Results With Vincent Delisle, Head of Liquid Markets at La Caisse

This afternoon, I had a chance to talk results and markets with Vincent Delisle, Head of Liquid Markets at La Caisse.

I want to thank him and Conrad Harrington who set up the Teams meeting.

Vincent began by giving me an overview of the results:

We're quite happy with the results. The RRQ, the CPP equivalent, comes in close to 10%. These results exceed the ask from our depositors. The funds are well funded, in very, very good health. What we're seeing is some strong returns from Public Equities, Infra and Credit which had a had a great year. Real Estate, still tough, but better than it was last year. Private Equity is somewhat disappointing for the year, coming in at 2% but it's been a significant tailwind in terms of performance on a 5 and 10 year horizon. Our business is to have a diversified portfolio focused on requirements from our depositors, adjusted for risk. So we're happy with the returns that we generated in today's environment where public equities had another stellar year in 2025, so it's been three years of very robust performing for all things public equities. It has an impact on our value added, because obviously our private portfolios -- private equity portfolios, benchmarked against that, Infra as well. So these are, these are challenges for our industry in terms of how the performance is perceived and and received, but we're quite happy with how we executed last year.  

I then asked Vincent specifically about PE: "A couple questions here on private equity. I don't know if you even know this. Were the returns mostly due to significant write downs taken in one or two investments, or was it just broad based valuation contraction of the multiples?"

He responded"

When you look at the private equity portfolio, profit growth for our companies was up six to 7% which is pretty much in line with what we're seeing in the industry. Valuations were hit by rising interest rates and there were one or two writedowns that took the numbers down from 6-7% to 2%.

In Real Estate, I told him I heard Charles say this morning that they sold some office towers in the US and he confirmed this:

Yes, we had some strategic dispositions in the US, absolutely. The key turnaround for this team in this portfolio, is going from a real estate operator to a real estate investor. And we were, we're rejigging the philosophy of this portfolio, rebuilding the team while the industry is going through some very, very challenging times. The numbers last year basically flattish on the year, better than what we did the year prior, at minus 11%, but it's still navigating within an industry that is see some significant headwinds.

I asked him what the split is at the Caisse between private and public markets and off the top of his head he said roughly 65/35 public vs private.

I then stated private credit and emerging market debt boosted the returns of the Credit portfolio and asked him to give me a bit more flavour there.

He shared this:

Just to be clear for us, Liquid markets includes public equities and all of fixed income, including private credit. So why is that? Our private loans mature within two to three years, so we get the liquidity coming back quite quickly. The emphasis here on liquid markets and then public. The credit portfolio had a stellar year in 2025, 9.6% absolute return outperformance relative to its benchmark and the way that portfolio has been structured from day one in 2017 was a hybrid between public credit and private credit. 

We do a lot of arbitrage to make sure that the premium that we're getting on the private side is worth, you know, giving away the liquidity. And we also have a the emerging market debt strategy in there that brings a very solid construction to the credit portfolio. It also brings volatility. I'm not going to lie to you, but when things work out like they did last year, we ticked all the boxes on the on the credit side. We didn't start doing emerging market debt last year. We've been doing it since 2017. What worked for us, or for emerging market debt in 2025 is a is basically a combination of two things, yields went down in markets in countries like Colombia, Brazil and Mexico, and their currencies appreciated. We had not seen that double that positive combo in recent years, so that was a significant driver of performance. On the private credit side, it was still a very, very, very good year, but the contribution from emerging market debt is really where the outperformance came from in 2025.

I asked him if he could give me the breakdown of the Credit portfolio which he did:

As of December 31 2025, 56% of the credit portfolio is allocated to privates, and remaining 44% is on the on the public side. Every year we're in our strategic plan. The goal, the objective, is to deploy $20 to $22 billion to new loans on the on the private side. In recent years, the amount of refinancing has been very elevated. So, for instance, last year we deployed $21 billion, we got $17 billion in refinancing, so the net increase was only $4 billion. But the teams can deploy, you know, they're very solid. The deployment is allocated to bank loans, direct lending, infrastructure debt, real estate debt, and also capital solutions team.

I told him I did see they are looking to double the private credit portfolio over the next five years and asked him if that's feasible.

He replied: 

It is feasible we can deploy. The teams are deploying north of $20 billion a year right now, getting north of $20 billion,we need refinancings to slow. And the thing we don't control is what happens on the public side. The key differentiator when you look at our credit portfolio relative to the Maple 8s, I think there are two differentiation. We do emerging market debt in there on the credit side, and we, we have the pool of public and private under the same house. There's an arbitrage. Every single deal that comes true has to be the public benchmark. I'm mentioning this because if credit spreads on the public side widen significantly, there will be a period where we're not going to allocate as aggressively on the credit side, but the strategic planning takes us above $120 billion.

He added: 

I think is very, very smart. And the portfolio was built that way in 2017 and we've seen instances where spreads widen significantly, and we can dial down, the tap, and then we dialed it back, back up. I think it's significant advantage. 

I moved on to public equities where I read they were underweight gold shares and some Quebec stocks  cost them some performance last year.

Vincent replied:

When you, when you look at the performance of our public equity portfolio, we outperform the MSCI World, and we outperformed the MSCI Emerging Markets. So our internal teams, our external teams, added value. It is a very tough environment to add value, and when you look at our positioning relative to the world, we're second quartile. And I'm very proud of that. The mandate where we had more difficulties last year was our Canadian mandate. We have some exposure to gold, but not to the same extent as the as the benchmark and a few Quebec stocks had more difficult years on a relative basis, that's the only mandate where we underperformed last year. So all things global, and I'm always very proud to mention this, but 100% of what we manage global and em internally, is managed here from our offices in Montreal, by our by our quant teams and fundamental teams, and they, they had a great year.

He told me their benchmark is MSCI Acqui for 80% and 20% is a Canada benchmark because their home bias and the large position they have in Canada.

We moved on to US stocks where I noted concentration risk was high again last year. I noted this year software stocks are getting slammed and chip stocks, especially memory, are surging again. 

Vincent noted the following:

There are a lot of things going on. So let me touch on a few topics, concentration and how it is making it challenging for investors. There's two concepts of concentration, the one that was very challenging form 2020 to 2024, was the concentration in the benchmark that was going up, so the FANGs become the Mag-7s, and all of a sudden, you know, the Mag-7s account for 33% or so of the S&P 500. 

The other aspect of concentration is concentration of gains. And even though the Mag-7s last year did not dominate. The concentration of gains was very, very high. So you take the time the 10 largest contributors to the S&P 500 last year, you get the 68% it was north of 50 in 2024 and 2023. In your average year, pre-Covid, you're running at 25 to 30% so that aspect, when you have a diversified portfolio, makes it very tough. 

How do we navigate this? In 2020 we had very little technology exposure. We had to do something. 2021, 2022 and 2023 we significantly increased our US / tech exposure, and we kind of capped it off in 2024 and in 2025 we reduced our US exposure as I mentioned this morning. 

We're trying to play that. We're trying, but we're much more selective in how we we get exposure to the AI thematic, the technology thematic. We find better opportunities outside the US. We don't want to play the hyperscalers just being naive and chasing the hyperscalers. So last year, what helped us is we reallocated some US exposure into European financials, Korean tech, Taiwan tech and Japanese industrials and financials. 

On AI. AI has been dominating everything since 2022 but the way AI dominates has changed significantly since last fall. And this year, it's quite amazing to see what's going on, because the big spenders, hyperscaler spenders, are not getting the retribution anymore. There's the market's much more selective and doesn't give the benefit of the doubt to everybody that's spending like like crazy, and then you have a whole SWAT of industries that are getting penalized because of the fear of of disruption.

Our thesis is that we think the markets can still move a bit higher but our thesis is that there's, there will be broadening of leadership. And there are many, many sector that have been left for dead in the last few years that are coming back alive this year. So the rotation is, is very visible year to date, not only geographically. Last year was more geography, but this year is more on the sectoral basis, energy, materials, transports, consumer staples, REITs. These are all names that have not been talked about leadership in in recent years. So very selective on how we play AI geographically, more more opportunistic on the EAFE space, and broadening participation is how we try to align our portfolios. 

I noted the S&P Equal Weight Index (RSP) is outperforming the S&P 500 (SPY) this year and this is a good environment for active managers.

Vincent shared this:

The environment of a concentration disadvantage that was prevailing in recent years, having the US equal weight outperforming the market cap weighting is going to make life easier for portfolios that are more diversified. And look at the spread right now on my screen, RSP plus six. Spider up one. Yes, it is an environment where actually being be more prudent. And, you know, diversifying within sectors and geography makes it, makes it easier to beat the benchmarks.

I told him that we are only two months into the year and things can change on a dime so it's too early to predict the end of tech this year.

He added:

We must not prematurely call it over. It kind of started in Q4 and it accelerated in January and February. And from our standpoint, the reason why this rotation has been ongoing is twofold. First, there's some signs of life, nascent signs of life in US and global manufacturing, the PMIs and the the ISMs have been in recession for over three years. The New Order components are now back above 50. If we get an ISM increasing type of market this year, then more cyclical, the real economy sectors should perform better. And the other reason why, we had to give credence and weight to this rotation out of tech. It's getting more complicated within the tech sector as well. Software is getting killed. Memory is skyrocketing every day, the hyperscalers, some are performing, others not. So it would be, would it be surprising to see tech as a whole come back with the same extent of domination, but it could happen. 

But he added:

Software is certainly one area where you have to ask yourself, is the selloff overdone? Because there's no doubt companies in every area will be changed by what AI brings to the table. But the speed at which we've seen market cap evaporate in many, many industries, it begs the question, how much is too much? Right? 

Lastly, I asked him what worries him in terms of the macro environment?

Vincent shared his concerns:

Interest rates is where I keep my focus. I'm worried that eventually we can't have our cake and eat it too like we have. We can't have an economy that gets somewhat better and rates moving moving lower. 2025 was all about tariff shock. 2025 was all about central banks cutting rates aggressively. 2026 could see some slight improvements in global growth, exports, trade, manufacturing. If that happens, then we start pricing the next move from central banks in 27/28. 

I am more focused on what changes the trend in interest rates. You know, we've been living with so many fears and headlines over the recent years. You know, tariffs, wars in the Middle East. I'm paying very close attention to oil, because oil doesn't get enough credit for how inflation was tame last year. Oil is up 15% one five. Year to date, it's only late February, that that could throw a wrench into the pretty inflation picture that we have. 

I asked him what he thinks about AI unleashing a massive deflationary wave and he said this:

Well, it's hard to argue against that because we don't have any concrete evidence yet. AI will certainly have the same positive impact on productivity as what we saw with with technology, the internet, in the 2000s and 2010. Then you have these, you know, population, immigration, you know constraints. Look at Japan, look at the US, look at Canada. I wouldn't say it's smooth sailing for inflation just because AI is, is upon us. 

Great food for thought, so pay attention to oil and rates as they might be moving up over the next two years.

I wrapped it up there and thanked Vincent and Conrad. 

Conrad subsequently responded to an email question of mine on currency hedging and how much the slide in the US dollar cost them last year:

Regarding currency hedging, we partially hedged the USD exposure. Through this partial hedge, we protected $3,6 billion. The USD had a negative impact of around $6 billion (it would have been close to $10 without hedging). Please see the find the relevant section from our press release (see above).

Alright, that's a wrap.

Below,The Caisse posted an annual return of 9.3% for 2025, a result that, however, fell short of its benchmark portfolio's return of 10.9%, due to "geopolitical tensions" and "persistent tariff uncertainty."

This difference compared to its benchmark portfolio means that the Caisse's return in 2025 was lower than that of the financial indices to which it compares its performance.

Nevertheless, Quebecers' savings are doing well, assures the Caisse, which points out that its five-year annualized return of 6.5% surpasses its benchmark portfolio's 6.2%. Over a 10-year period, the Caisse posted an annualized return of 7.2%, while its benchmark portfolio's return was 6.9%.

RDI's Olivier Bourque explains the details (in French).

I like this clip because a minute in, Charles Emond is quoted saying they're highly diversified, looking to hit singles and doubles, not home runs.  

Coordinated, industry-backed campaigns to weaken child labor protections continue to target state legislatures in 2026. Yesterday, the Indiana Senate passed a bill to completely eliminate requirements for businesses to document employment of minor workers, and it is expected to be sent to the governor after House and Senate versions are reconciled. The bill’s Senate sponsor, who owns a golf course that employs teen workers, also spearheaded 2024 legislation to weaken guardrails on work hours for the youngest teens and to lower the age at which teens can serve alcohol. Both of those bills were signed into law.

Child labor violations have been on the rise nationally and in Indiana, and fundamental federal child labor standards have recently come under threat. There is no reason to eliminate Indiana’s simple, easy-to-use system for documenting youth employment, except to make it easier for employers to violate child labor laws and harder for investigators to find out about violations.

Lawmakers in at least five other states have introduced bills to weaken child labor standards this year. Florida, Missouri, and Nebraska lawmakers have proposed allowing employers to pay minors less than the minimum wage, with the Nebraska bill recently being signed into law. Virginia and West Virginia lawmakers proposed bills to weaken hazardous work protections for minors who participate in work-based learning programs. Advocates in Virginia and West Virginia are working to amend both bills to limit their harm and ensure these programs do not come at the expense of youth education and safety.

Bill would eliminate employer registration system that replaced Indiana’s youth work permit process

In 2020, lawmakers eliminated Indiana’s youth work permit process and replaced it with the new Youth Employment System (YES), which requires certain employers of five or more minor workers to register key details about that employment in an online database, with penalties of up to $400 for each failure to register employment of a minor. Less than five years after they were implemented, lawmakers are now seeking to eliminate these requirements through House Bill (HB) 1302. If signed into law, there will no longer be any state oversight system in place for ensuring legal, age-appropriate work for minors or for state agencies to use in investigating suspected violations.

The legislation being considered is especially concerning because Indiana lawmakers have already made some of the country’s most extreme changes to child labor protections in recent years. Lawmakers made other substantial changes to Indiana child labor law in 2020, including eliminating rest breaks for minor workers and extending maximum weekly hours for 16- and 17-year-olds.

State systems for documenting youth employment are key to preventing child labor violations

Recent research shows that requiring the documentation of youth employment—like youth work permits—play an important role in preventing child labor violations, but Indiana got rid of work permits in 2020, and now they are hoping to get rid of the system that replaced them. In an analysis of federal child labor violations between 2008 and 2020, states with work permit mandates had 13.3% fewer violation cases and 31.8% fewer minors involved in these violations. That’s because youth work permits ensure employers know the law and create a paper trail to aid in enforcement when state investigators suspect violations. According to the new study, requiring that work permits clearly state permitted working hours reduces the number of minors involved in violations by 24.0%.

Often, employers that violate mandated documentation requirements are also violating other child labor standards. For example, a recent audit of a major Burger King franchisee in Wisconsin found over 1,600 child labor violations affecting nearly 1,400 young workers, the largest in the state’s history. In addition to employing minors without a work permit, violations included failing to provide mandated rest breaks, employing minors beyond permissible working hours, and failing to pay overtime.

Sadly, lawmakers’ desire to eliminate the YES system may be precisely because the system has been working as intended. Last year, the Indiana DOL assessed over $250,000 in penalties on employers that failed to register youth employment. Indiana’s youth employment registration system allowed investigators to identify employers out of compliance with the registration law and may have played a role in deterring future, more serious violations.

As violations increase, lawmakers should seek to strengthen—not weaken—youth employment standards

Child labor violations have risen significantly in recent years across the U.S. and in Indiana, where a 2025 IndyStar analysis found an uptick in violations in recent years, particularly driven by instances of illegal hazardous child labor and illegal employment of children under age 14. According to state fiscal analysts who assessed HB 1302’s impact, the change “will likely reduce the efficiency of on-site employer inspections for compliance with child labor laws.” In other words, the legislature’s own analysts acknowledge that this bill will make it harder to protect Indiana children from illegal and potentially dangerous, exploitative, and abusive employment conditions.

There is no rationale for eliminating basic documentation requirements that prevent child labor violations and aid in enforcement, except to make it easier for unscrupulous employers to get away with breaking the laws that keep kids safe on the job. Coming on the heels of multiple bills that weakened Indiana’s child labor standards in the past few years, HB 1302 represents another shameful step backward for the state. But it is not too late for Indiana to reverse course. If the bill is sent to the governor, Indiana Governor Mike Braun can break with his party to veto the bill, just like Ohio Republican Governor Mike DeWine did when he vetoed a bill to extend working hours for minors late last year. At a time when federal child labor standards are under threat, state lawmakers have an opportunity and responsibility to resist efforts to weaken child labor protections and, instead, consider any of the numerous, proven options to strengthen them.