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I never used to listen to very many podcasts. But lately I've started doing it while heading to/from meetings, either in the car or on the train. This past week I listened to a Bankless podcast talking about crypto and AI, and one of the arguments that was made was that it's probably a safe bet to assume that we're going to need dramatically more compute and electricity in the future.
This seems obvious enough. If you recall, there's no such thing as a wealthy, low-energy nation. If you're a wealthy country, you consume a lot of energy. And that's why Build Canada recently argued that we need a kind of energy revolution. By 2050, it's likely Canada will have 2-3x the electricity demand that we have today. So today I thought I would share a few related charts.
Here's electricity production by source across the world. Coal dominates.
Looking at renewables more closely, we again see that wind and solar are making a run for it. And if you consider that solar is one of the fastest growing energy sources, it's not inconceivable that it will start to become a more dominant source in the near term. In the US, solar PV projects make up the largest share of new planned generation capacity.
But the US is not winning this race today. Right now it's China. (Chart below sourced from here.) They have the largest cumulative solar capacity, followed by the EU, and then the US. That said, coal still forms a dominant part of China's energy mix, and the country continues to construct coal-fired power plants to meet its short-term energy needs.
It's unfortunate that Canada is not on this list. That needs to change.
Cover photo by Benjamin Jopen on Unsplash
The silver lining to the US starting a trade war with Canada and regularly threatening annexation is that it has forced this country out of complacency. Indeed, I'm hard pressed to think of a time, at least in my lifetime, when patriotism and nationalism has united so much of Canada.
According to a recent survey by Angus Reid, the percentage of Canadians expressing a "deep emotional attachment" to the country jumped from 49% in December 2024 to 59% in February 2025. And as further evidence of just how unifying this moment in time is, the province with the biggest increase in attachment to country was Québec.
What it means to be a Canadian is sometimes lazily defined according to who or what we are not. But this precarious moment in time is seemingly reminding us who we are. Of course, it also begs the questions: Where do we want to go from here? And do we have the leadership to take us there?
Let's start by looking at some, but of course not all, of the things that we have going for us as a country:
Second-largest country in the world by land mass.
World's longest coastline, with access to both the Pacific and Atlantic Oceans, and increasingly the Arctic Ocean.
Third-largest proven oil reserves in the world (estimated at close to 300 billion barrels), behind Saudi Arabia.
World's largest producer and exporter of potash (which is a key component in fertilizers).
Energy independent and broadly rich in resources (see below diagram).
A fifth of the planet's surface freshwater.
Exactly a year ago, I wrote this post talking about "what might happen in 2024." Now let's see what actually happened and how I did with my predictions.
Interest rate cuts: This was perhaps an easy one as there was already a market consensus that rates would start to come down in 2024. The Bank of Canada cut its policy interest rate by 175 bps (target of 3.25%), and the US cut its federal funds rate by 100 bps (target of 4.5%). [1 point]
Impact of higher rates: I predicted that things would get worse in 2024 before they started to get better (maybe toward the end of 2024 or perhaps in 2025). In some ways, I think I was right. But I'm not sure we've returned to a "risk-on" approach in commercial real estate, like I suggested. Toward the end of the year, my American friends were telling me that things were suddenly feeling a lot more optimistic and that more deals were being done. But I still feel like we've been kicking the can down the road here in Canada. The public markets certainly did very well, but I think the private markets are still hiding some underwater real estate investments. [0.5 point]
Balanced residential resale market: I thought that we would return to a more balanced resale market in 2024, certainly for the most-in demand cities and submarkets. Here in Toronto, it remains a buyer's market on the condominium side, but the freehold market in Central Toronto has shown signs of improvement over the last few months. Detached house values are up 4.6% year-over-year, despite listing supply also being up 29%. The resilience of core submarkets is what you would expect to see right now during this part of the cycle. (If you're interested in Toronto real estate, my friend Christopher Bibby has a great newsletter that he publishes periodically.) At the same time, I thought that the Bank of Canada would be more resistant to lowering rates compared to other central banks, and that this would be good for the Canadian dollar. I was wrong. [0 points]
Finding good real estate deals in 2024: I argued that this year would be a pivotal year for finding new opportunities. Maybe that was the case for some of you, but as I said above, I think that here in Canada we're still kicking the can down the road. So this one is hard to say. 2025 may end up being more pivotal for many real estate developers and investors. [0 points]
Declining hard costs: Like many of my other predictions, this is market specific. But this absolutely happened here in Toronto. For some trades and divisions, costs are down in the range of 25-30%. And I can tell you that over this past year I received many phone calls from construction executives that sounded something like this, "Hey, I'm about to lay off a bunch of people, so I just wanted to call and see if you might have any new projects starting up in the near future." [1 point]
Total score: 6/11 (~55%). Not bad.
I like this score because it means I'm not being too consensus. What fun would that be? That said, I do think some of my predictions were a little obvious. I don't want to be just extrapolating existing data forward; I want to be thinking critically. I also try not to stray too far into topics that I'm not well versed on, like shopping on TikTok. But it's a fine line given my strong interest in tech and crypto. I'll see what I can do to tighten things up and be a little more non-consensus with my predictions this year.
Stay tuned.
I never used to listen to very many podcasts. But lately I've started doing it while heading to/from meetings, either in the car or on the train. This past week I listened to a Bankless podcast talking about crypto and AI, and one of the arguments that was made was that it's probably a safe bet to assume that we're going to need dramatically more compute and electricity in the future.
This seems obvious enough. If you recall, there's no such thing as a wealthy, low-energy nation. If you're a wealthy country, you consume a lot of energy. And that's why Build Canada recently argued that we need a kind of energy revolution. By 2050, it's likely Canada will have 2-3x the electricity demand that we have today. So today I thought I would share a few related charts.
Here's electricity production by source across the world. Coal dominates.
Looking at renewables more closely, we again see that wind and solar are making a run for it. And if you consider that solar is one of the fastest growing energy sources, it's not inconceivable that it will start to become a more dominant source in the near term. In the US, solar PV projects make up the largest share of new planned generation capacity.
But the US is not winning this race today. Right now it's China. (Chart below sourced from here.) They have the largest cumulative solar capacity, followed by the EU, and then the US. That said, coal still forms a dominant part of China's energy mix, and the country continues to construct coal-fired power plants to meet its short-term energy needs.
It's unfortunate that Canada is not on this list. That needs to change.
Cover photo by Benjamin Jopen on Unsplash
The silver lining to the US starting a trade war with Canada and regularly threatening annexation is that it has forced this country out of complacency. Indeed, I'm hard pressed to think of a time, at least in my lifetime, when patriotism and nationalism has united so much of Canada.
According to a recent survey by Angus Reid, the percentage of Canadians expressing a "deep emotional attachment" to the country jumped from 49% in December 2024 to 59% in February 2025. And as further evidence of just how unifying this moment in time is, the province with the biggest increase in attachment to country was Québec.
What it means to be a Canadian is sometimes lazily defined according to who or what we are not. But this precarious moment in time is seemingly reminding us who we are. Of course, it also begs the questions: Where do we want to go from here? And do we have the leadership to take us there?
Let's start by looking at some, but of course not all, of the things that we have going for us as a country:
Second-largest country in the world by land mass.
World's longest coastline, with access to both the Pacific and Atlantic Oceans, and increasingly the Arctic Ocean.
Third-largest proven oil reserves in the world (estimated at close to 300 billion barrels), behind Saudi Arabia.
World's largest producer and exporter of potash (which is a key component in fertilizers).
Energy independent and broadly rich in resources (see below diagram).
A fifth of the planet's surface freshwater.
Exactly a year ago, I wrote this post talking about "what might happen in 2024." Now let's see what actually happened and how I did with my predictions.
Interest rate cuts: This was perhaps an easy one as there was already a market consensus that rates would start to come down in 2024. The Bank of Canada cut its policy interest rate by 175 bps (target of 3.25%), and the US cut its federal funds rate by 100 bps (target of 4.5%). [1 point]
Impact of higher rates: I predicted that things would get worse in 2024 before they started to get better (maybe toward the end of 2024 or perhaps in 2025). In some ways, I think I was right. But I'm not sure we've returned to a "risk-on" approach in commercial real estate, like I suggested. Toward the end of the year, my American friends were telling me that things were suddenly feeling a lot more optimistic and that more deals were being done. But I still feel like we've been kicking the can down the road here in Canada. The public markets certainly did very well, but I think the private markets are still hiding some underwater real estate investments. [0.5 point]
Balanced residential resale market: I thought that we would return to a more balanced resale market in 2024, certainly for the most-in demand cities and submarkets. Here in Toronto, it remains a buyer's market on the condominium side, but the freehold market in Central Toronto has shown signs of improvement over the last few months. Detached house values are up 4.6% year-over-year, despite listing supply also being up 29%. The resilience of core submarkets is what you would expect to see right now during this part of the cycle. (If you're interested in Toronto real estate, my friend Christopher Bibby has a great newsletter that he publishes periodically.) At the same time, I thought that the Bank of Canada would be more resistant to lowering rates compared to other central banks, and that this would be good for the Canadian dollar. I was wrong. [0 points]
Finding good real estate deals in 2024: I argued that this year would be a pivotal year for finding new opportunities. Maybe that was the case for some of you, but as I said above, I think that here in Canada we're still kicking the can down the road. So this one is hard to say. 2025 may end up being more pivotal for many real estate developers and investors. [0 points]
Declining hard costs: Like many of my other predictions, this is market specific. But this absolutely happened here in Toronto. For some trades and divisions, costs are down in the range of 25-30%. And I can tell you that over this past year I received many phone calls from construction executives that sounded something like this, "Hey, I'm about to lay off a bunch of people, so I just wanted to call and see if you might have any new projects starting up in the near future." [1 point]
Total score: 6/11 (~55%). Not bad.
I like this score because it means I'm not being too consensus. What fun would that be? That said, I do think some of my predictions were a little obvious. I don't want to be just extrapolating existing data forward; I want to be thinking critically. I also try not to stray too far into topics that I'm not well versed on, like shopping on TikTok. But it's a fine line given my strong interest in tech and crypto. I'll see what I can do to tighten things up and be a little more non-consensus with my predictions this year.
Stay tuned.
Multi-cultural country — over 20% of Canadians are foreign-born.
Robust immigration system that attracts top talent from around the world.
Highly-educated workforce with some of the world's best universities — over 60% of Canadian adults have a post-secondary education which is one of the highest rates globally.
Average life expectancy of 82.3 years (2023 data), which is about 5 years higher than that of the US.
Leader in AI, quantum computing, green tech, and space robotics — Canada produces more AI research papers per capita than almost any other country and the Stanford AI Index (2023) ranked Canada 4th behind only the US, China, and the UK.
Here's some of our bounty (via the Financial Times):
And yet, we are not a global superpower.
Worse, we are lagging behind our G7 peers in GDP growth, we are plagued by declining productivity levels, we are not investing enough in new business creation and entrepreneurship, and we have one of the worst affordable housing shortages in the developed world, among other things. We have been complacent for far too long, and a big part of this is because we have, or at least had, the world's largest economy next door demanding our goods.
As of 2024, 61% of all imported oil to the US came from Canada. And US refineries are specifically setup to refine our crude and viscous varietal. This is good for them. They buy our goopy oil at a discount, refine it, and then sell it for a profit. But now the US is clearly saying there's nothing they need or want from Canada. They've also demonstrated through their actions that, under the current administration, they can no longer be trusted as an ally and trading partner. So it behooves us to evolve. It behooves us to take matters into our own hands.
Here are some ideas:
Firstly, Canada should become a republic. For me, this is less about the monarchy being outdated (though it is) and more about the fact that a sovereign superpower like Canada should have its own head of state, and not a foreign King.
Canada needs to increase defense spending and exert much stronger sovereignty over its Arctic lands. For fiscal year 2024-2025, defense spending is projected to reach 1.37% of GDP. This obviously falls short of NATO's 2% target.
Remove red tape and unleash the Canadian economy. Last year, Canada exported more to the US than between its own provinces and territories. Huh? By some estimates, our economy could grow by up to $5,100 per capita simply by eliminating internal trade barriers.
Barriers also need to be removed from the delivery of new housing. Canadians have been over-indexing on housing because of eroding affordability. Our current market environment is an ideal time for market reforms. Here's just one recent post that offers a few concrete suggestions for how to do this.
Grow the Canadian population to 100 million people by 2100. Obviously there are two main ways to do this: We can help Canadians have more babies (more affordable housing certainly assists with this) and we can continue to attract the smartest and most ambitious people from around the world. As of 2022, Canada's fertility rate sat at 1.33, which is below the OECD average of 1.5 births per woman. (The above population target is the focus of a charitable organization called the "Century Initiative.")
Create a sovereign wealth fund akin to what Norway did. Today, Norway has the largest sovereign wealth fund in the world (based on assets under management) and it translates to over US$325,000 per Norwegian citizen and one of the highest GDPs per capita on the planet. Canada also has abundant natural resources as we know. The revenues generated from these resources should (1) accrue to the Canadian population and future generations and (2) steer the global economy toward a more sustainable future.
Invest heavily in new infrastructure. This includes everything from high-speed rail to oil pipelines. In 2020, Canada exported 82% of the crude oil it produced, with most of it going to the US via pipeline from western provinces. If the US no longer wants this, then we ought to find some new customers.
At the same time, we cannot let our abundant natural resources become a curse (see "the paradox of plenty"). We need to be a leader in the new economy. As I've written about before, I find it shocking, for example, that Canada is not stepping up more when it comes to new technologies like crypto. Vitalik Buterin, who is one of the founders of Ethereum and its most prominent figurehead, grew up in Toronto. He went to the University of Waterloo. We should be leveraging this homegrown talent to become a capital of crypto. And this is just one specific example.
Do everything we can to spur more innovation, more risk-taking, and more private investment. It's one thing to have great Universities that publish a lot of research, but ultimately we need to turn this into thriving companies that employ Canadians and generate wealth for Canadians. Here's a post I published in 2023 called, "Canada has an existential productivity problem."
This is obviously not a comprehensive list of all the things that Canada should be doing as a country. And invariably, some or many of you will disagree with some or most of what I have put forward here. But hopefully we can all agree that now, more than ever, we need a strong Canada. We need to start thinking of ourselves as an emerging global superpower.
Cover photo by Juan Rojas on Unsplash
Return to office: A year ago, I wrote that return to office seemed to have stalled out at around 50% utilization. But I argued that this wouldn't hold and that, of the people who work in offices, most would go back to spending > 50% of their week in it. Looking at the latest data for Toronto's CBD (from November 15, 2024), the average weekly utilization figure is now up to 73%. And the peak day figure (Wednesday) is now 84%. (Both of these are relative to pre-COVID.) This is up meaningfully compared to last year. I don't know at what point we reach an equilibrium, but for now, we seem to be still heading up and to the right. [1 point]
Augmented reality: 2023 was the year of AI. I argued that this year would be the year of augmented reality and that this would represent a further blurring of our offline and online worlds. This was, I think, coming from the fact that Apple Vision Pro was set to be released. But if this happened at all, it happened only incrementally and it certainly wasn't a mainstream phenomenon. Most people I talk to haven't even tried Apple Vision Pro, though I remain blown away by the technology. If you haven't yet tried it, do yourself a favor and book a demo at your local Apple Store. That said, I'm not going to give myself any points for this one. [0 points]
Autonomous vehicles: I was somewhat bearish on this a year ago. I said that it feels as if we're in the trough of disillusionment (within the hype cycle), even if I was optimistic long term. So this year was a pleasant surprise and I was thoroughly impressed by the progress that Waymo, in particular, made. As of June of this year, they had already logged over 22 million rider-only miles. They are the company to beat right now. [0 points]
Impact of automation: This was a weak prediction because it wasn't particularly precise. I said that our shift toward greater automation would feel more insidious than immediate (certainly in 2024). I guess this is true. Elon Musk unveiled dancing bartender robots this year, but they weren't exactly ready to take all of our jobs. Reluctantly, I'll give myself a half point. [0.5 point]
Growth of TikTok Shop: This is where I argued that we should be looking for the future of shopping. And the data certainly supports this. According to recent research from The New Consumer, over 60% of Gen Z's report using TikTok every day. And half of all monthly active users report having already made a purchase through the platform. For those that use it every day, this figure increases to 57%. I don't use TikTok very often -- if at all -- but I know it's extremely popular. I'm also not an expert on e-commerce, but I have a belief that TikTok (and the likes), augmented reality, and crypto are going to give birth to some interesting new ways of buying things. [1 point]
Return of crypto: When I wrote last year's post, the total crypto market capitalization was approximately $1.74 trillion. This was down from almost $3 trillion at the peak of the market in 2021. I argued that the "crypto winter" would end this year and that its total market cap would exceed its previous peak by the end of this year. Today, it's about $3.45 trillion. If only I bought more. But to be honest, this was a total guess. [1 point]
Multi-cultural country — over 20% of Canadians are foreign-born.
Robust immigration system that attracts top talent from around the world.
Highly-educated workforce with some of the world's best universities — over 60% of Canadian adults have a post-secondary education which is one of the highest rates globally.
Average life expectancy of 82.3 years (2023 data), which is about 5 years higher than that of the US.
Leader in AI, quantum computing, green tech, and space robotics — Canada produces more AI research papers per capita than almost any other country and the Stanford AI Index (2023) ranked Canada 4th behind only the US, China, and the UK.
Here's some of our bounty (via the Financial Times):
And yet, we are not a global superpower.
Worse, we are lagging behind our G7 peers in GDP growth, we are plagued by declining productivity levels, we are not investing enough in new business creation and entrepreneurship, and we have one of the worst affordable housing shortages in the developed world, among other things. We have been complacent for far too long, and a big part of this is because we have, or at least had, the world's largest economy next door demanding our goods.
As of 2024, 61% of all imported oil to the US came from Canada. And US refineries are specifically setup to refine our crude and viscous varietal. This is good for them. They buy our goopy oil at a discount, refine it, and then sell it for a profit. But now the US is clearly saying there's nothing they need or want from Canada. They've also demonstrated through their actions that, under the current administration, they can no longer be trusted as an ally and trading partner. So it behooves us to evolve. It behooves us to take matters into our own hands.
Here are some ideas:
Firstly, Canada should become a republic. For me, this is less about the monarchy being outdated (though it is) and more about the fact that a sovereign superpower like Canada should have its own head of state, and not a foreign King.
Canada needs to increase defense spending and exert much stronger sovereignty over its Arctic lands. For fiscal year 2024-2025, defense spending is projected to reach 1.37% of GDP. This obviously falls short of NATO's 2% target.
Remove red tape and unleash the Canadian economy. Last year, Canada exported more to the US than between its own provinces and territories. Huh? By some estimates, our economy could grow by up to $5,100 per capita simply by eliminating internal trade barriers.
Barriers also need to be removed from the delivery of new housing. Canadians have been over-indexing on housing because of eroding affordability. Our current market environment is an ideal time for market reforms. Here's just one recent post that offers a few concrete suggestions for how to do this.
Grow the Canadian population to 100 million people by 2100. Obviously there are two main ways to do this: We can help Canadians have more babies (more affordable housing certainly assists with this) and we can continue to attract the smartest and most ambitious people from around the world. As of 2022, Canada's fertility rate sat at 1.33, which is below the OECD average of 1.5 births per woman. (The above population target is the focus of a charitable organization called the "Century Initiative.")
Create a sovereign wealth fund akin to what Norway did. Today, Norway has the largest sovereign wealth fund in the world (based on assets under management) and it translates to over US$325,000 per Norwegian citizen and one of the highest GDPs per capita on the planet. Canada also has abundant natural resources as we know. The revenues generated from these resources should (1) accrue to the Canadian population and future generations and (2) steer the global economy toward a more sustainable future.
Invest heavily in new infrastructure. This includes everything from high-speed rail to oil pipelines. In 2020, Canada exported 82% of the crude oil it produced, with most of it going to the US via pipeline from western provinces. If the US no longer wants this, then we ought to find some new customers.
At the same time, we cannot let our abundant natural resources become a curse (see "the paradox of plenty"). We need to be a leader in the new economy. As I've written about before, I find it shocking, for example, that Canada is not stepping up more when it comes to new technologies like crypto. Vitalik Buterin, who is one of the founders of Ethereum and its most prominent figurehead, grew up in Toronto. He went to the University of Waterloo. We should be leveraging this homegrown talent to become a capital of crypto. And this is just one specific example.
Do everything we can to spur more innovation, more risk-taking, and more private investment. It's one thing to have great Universities that publish a lot of research, but ultimately we need to turn this into thriving companies that employ Canadians and generate wealth for Canadians. Here's a post I published in 2023 called, "Canada has an existential productivity problem."
This is obviously not a comprehensive list of all the things that Canada should be doing as a country. And invariably, some or many of you will disagree with some or most of what I have put forward here. But hopefully we can all agree that now, more than ever, we need a strong Canada. We need to start thinking of ourselves as an emerging global superpower.
Cover photo by Juan Rojas on Unsplash
Return to office: A year ago, I wrote that return to office seemed to have stalled out at around 50% utilization. But I argued that this wouldn't hold and that, of the people who work in offices, most would go back to spending > 50% of their week in it. Looking at the latest data for Toronto's CBD (from November 15, 2024), the average weekly utilization figure is now up to 73%. And the peak day figure (Wednesday) is now 84%. (Both of these are relative to pre-COVID.) This is up meaningfully compared to last year. I don't know at what point we reach an equilibrium, but for now, we seem to be still heading up and to the right. [1 point]
Augmented reality: 2023 was the year of AI. I argued that this year would be the year of augmented reality and that this would represent a further blurring of our offline and online worlds. This was, I think, coming from the fact that Apple Vision Pro was set to be released. But if this happened at all, it happened only incrementally and it certainly wasn't a mainstream phenomenon. Most people I talk to haven't even tried Apple Vision Pro, though I remain blown away by the technology. If you haven't yet tried it, do yourself a favor and book a demo at your local Apple Store. That said, I'm not going to give myself any points for this one. [0 points]
Autonomous vehicles: I was somewhat bearish on this a year ago. I said that it feels as if we're in the trough of disillusionment (within the hype cycle), even if I was optimistic long term. So this year was a pleasant surprise and I was thoroughly impressed by the progress that Waymo, in particular, made. As of June of this year, they had already logged over 22 million rider-only miles. They are the company to beat right now. [0 points]
Impact of automation: This was a weak prediction because it wasn't particularly precise. I said that our shift toward greater automation would feel more insidious than immediate (certainly in 2024). I guess this is true. Elon Musk unveiled dancing bartender robots this year, but they weren't exactly ready to take all of our jobs. Reluctantly, I'll give myself a half point. [0.5 point]
Growth of TikTok Shop: This is where I argued that we should be looking for the future of shopping. And the data certainly supports this. According to recent research from The New Consumer, over 60% of Gen Z's report using TikTok every day. And half of all monthly active users report having already made a purchase through the platform. For those that use it every day, this figure increases to 57%. I don't use TikTok very often -- if at all -- but I know it's extremely popular. I'm also not an expert on e-commerce, but I have a belief that TikTok (and the likes), augmented reality, and crypto are going to give birth to some interesting new ways of buying things. [1 point]
Return of crypto: When I wrote last year's post, the total crypto market capitalization was approximately $1.74 trillion. This was down from almost $3 trillion at the peak of the market in 2021. I argued that the "crypto winter" would end this year and that its total market cap would exceed its previous peak by the end of this year. Today, it's about $3.45 trillion. If only I bought more. But to be honest, this was a total guess. [1 point]
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