The People vs Amazon
Remember when Amazon announced they were scouting locations for a second HQ and just about every municipal government lost their sh*t promoting their city?
Well, the ‘winners’; Queens, New York City and Washington, DC, started having second thoughts pretty much immediately. And after months of extended protest, social media and advocacy campaigns, Amazon announced they would withdraw plans to build in NYC last week.
Initially, NYC had offered Amazon $3 billion in tax breaks and financial incentives in exchange for 25,000 jobs.
Amazon said “deal”. Residents of NYC said “Wait a second”
Their gripe? Amazon is a multinational corporation worth $1 trillion, and many felt that tax breaks in the billions were unwarranted, especially when competing local businesses were forced to pay their full tax bill.
In addition, local lawmakers and community organizations were reportedly left out of private discussions surrounding city planning and further incentives. Many feared that the new HQ would put further pressure on an already constrained housing market.
At the end of the day, many hoped that public pressure would force Amazon to renegotiate. Instead, they backed out completely.
The saga shone a light on growing tensions between omni-powerful mega companies (like the FAANGs), and the immense challenges lawmakers face in equitably regulating these giants.
Take for instance, the debate surrounding privacy and the dissemination of ‘fake news’. Just this week, Canadian politicians from an inter-parliamentary committee dedicated to fighting disinformation called on top tech execs, including Jeff Bezos of Amazon and Mark Zuckerberg of Facebook, to testify about their practices. TBD on whether they accept the invite.
Going together like PB&AI..?
From the Canadarm, to the pacemaker, to peanut butter (yes, really); Canadians have proven to be natural innovators. Our next challenge: becoming a leader in artificial intelligence (AI) – and quick.
Before we get into it, lets first break this down because AI has turned into a buzzword that seems to encapsulate all things technology. At its core, AI is about artificial neural networks, or a computer being able to discern and make connections based on information it has been fed; getting smarter as it makes guesses and learns from failures.
Like nearly every breakthrough, AI was met with a lot of skepticism at the start. But three men, known by many as the godfathers of AI – two of whom are Canadian – and the Canadian Institute for Advanced Research, began neural networks discovery right here in Canada.
Geoffrey Hinton, a computer science professor at the University of Toronto and a member of the AI team at Google LLC’s Toronto office; Yann LeCun, a professor at New York University and the head of Facebook’s AI research; and Yoshua Bengio, a professor at the University of Montreal and the director of Mila – Quebec Artificial Intelligence Institute and founder of Element AI, are the men – the godfathers – behind the discovery that is used in nearly every smartphone and computer.
AI’s foundation in Canada keeps it Canada’s game, if you will. But a strong past doesn’t mean a natural future, especially in the competitive landscape of big multinational companies like Amazon and Google.
According to the Institute of Governance, which ranks 35 OECD countries on ‘AI Readiness’ – or countries ability to foster and promote AI-related innovation, Canada is ranked third, behind the UK and US.
Leaders in the field say the key to Canada’s future success depends on cultivating talent – which comes down to funding and training. Remember our article about brain drain? Retaining top talent is crucial – as is encouraging venture capital and providing subsidies for research and development.
We’ll have to wait and see how Canada’s race to be an AI superpower plays out. But no matter what happens, we’ll always have peanut butter.
Housing is more Affordable… but still Unaffordable.
A poll by Reuters is the latest confirmation that the Canadian housing market has entered a slump.
Analysts surveyed in the poll predicted housing prices will continue to rise nationally over the next few years – but at a much slower pace than what we’ve seen in recent years.
In other words, the outlook here is a market correction, which is a decline in market prices that follows a temporary upswing.
A correction in the market sounds like a good thing given that the prospect of owning a home has become laughable to many millennials, but a cooled down housing market could actually be a sign of economic downturn.
The shift from homeownership to rentals in a significant portion of the Canadian market will continue to thrive. Looking at Toronto in 2018, for example, the sales of new homes were the lowest they’ve been in almost two decades, according to the Financial Post.
If Canadians aren’t renting (or living with their parents – no judgment), they’re borrowing against their homes to pay for everything else like car payments and renovations. Home equity lines of credit (known as Helocs) are on the rise, growing faster than mortgages since 2017.
Without getting into the nitty gritty of mortgages vs. helocs (another day), the point is a correction in the housing market could pull Canada’s economic growth down with it. Residential investment nationwide has been an important driver of growth, with Canadians piling up in debt to try and take advantage of the housing boom. With some economists saying a price correction of up to 40% could take place over the next 5 years, these indebted homeowners face the possibility of losing any profit off their investment.
Coupled with impending interest rate hike, consumers are becoming less encouraged to take the leap into homeownership.
Until then, we’ll continue dropping subtle hints that we wanna move back in with mom and dad.