This week's interesting finds

A chart worth discussing

“Chase credit card data is showing consumer spending accelerating.”

- Jason Liu

Other charts worth pointing out

Chinese car exports to Europe

Battery EV prices – China vs. Europe

Business research & development spending by country

Year-over-year change in New York restaurant counts

Technology fund flows by year

Private client equity allocations

Days per year of broad 2%+ technology declines

AI-related high yield credit spreads

AI-related investment grade credit spreads

Credit default risk prices for AI-related issuers

U.S. project finance bond issuance

Project finance issuances by industry

High yield project finance bond ownership by investor type

Credit spread percentile rankings by region and credit quality since 2000

Credit spread percentile rankings by region and credit quality since 2010

Cross-asset class correlation

Asset class performance by year

Biotech start-ups turn to reverse mergers to fast-track listings

Twenty-three biotechs have announced they are pursuing reverse mergers this year, according to investment bank William Blair — up from four last year. That surge has come despite a revival in biotech IPOs, which have also risen to 23 this year, from 12 in 2025.

In these deals, a private biotech can go public by merging with a listed company, usually one that has suffered a significant setback such as the failure of a main drug candidate, enabling it to bypass the traditional IPO process.

More biotechs have turned to this type of deal in the past year thanks to a ready supply of listed merger candidates following a pandemic-era jump in biotech IPOs and a growing number of sophisticated investors willing to finance them.

Those investors have helped to boost the sums raised in such deals. In July private biotech Caldera Therapeutics secured $278mn from investors including Bain Capital Life Sciences, Atlas Venture and Janus Henderson to merge with Synlogic. A month later Obsidian Therapeutics raised $350mn from Atlas and Janus Henderson among others to merge with Galera.

Lawyers and biotech executives said some companies were choosing reverse mergers even as the IPO market picked up, attracted by their relative speed and greater certainty over financing. Unlike a listing, where investor demand and pricing can be unpredictable, reverse mergers allow biotechs to agree valuations and secure financing upfront.

The recovery in traditional biotech IPOs has also given promising companies a route to market following a years-long drought, however. Recent listings include Alamar Biosciences, whose shares have risen about 15 per cent since it went public in April.

One life sciences investor stressed that companies would continue to evaluate both reverse mergers and IPOs, cautioning that after a string of such deals, the number of attractive merger candidates — cash-rich companies with clean balance sheets and no ongoing litigation — was dwindling.

This week’s fun finds

The World’s Happiest Country Is Hosting a ‘Quietchella’ in a National Park—Where Nature Is the Headliner

Could the answer to happiness be the sounds of the mire? Finland, aka the happiest country in the world, suggests you give it a go.

This month, the Nordic country will host the inaugural Festival of Nature Listening in Valkmusa National Park, a 90-minute drive east of the capital, Helsinki. Hiljaa Fest, which translates to “quietly fest,” will begin on October 10 and, after its opening day, will continue throughout the fall as an unguided experience in the nearly seven-square-mile park, home to 40 different mire (wetland and bog) habitats and diverse wildlife.

According to the organizers, the lineup includes “13 unique nature stars of Valkmusa” from the plant and animal kingdoms, who will make appearances across four “stages.” “Every performer appears on their own terms, in their own habitat, and according to their own schedule,” the cheeky festival announcement reads. Guests can expect to see and hear local “artists” like black grouses, cranes, purple-bordered golds (a type of moth), peat moss, marsh Labrador tea (an evergreen shrub), and other native flora and fauna.

This week's interesting finds

A chart worth discussing

“The last time this much debt traded so far below par was during the COVID pandemic. For investors willing to do the work, the opportunity set is growing.”

- Derek Skomorowski

Other charts worth pointing out

High-yield corporate bond ETF (HYG) vs. the S&P 500 Index – implied volatility

Rolling 10-year U.S. bond returns since 1793

Expansion of hyperscaler issuances across currencies

European auto sales share by region of origin

European market share growth by automaker

Active court-ordered real estate listings in Vancouver & Fraser Valley

Share of stocks outperforming the S&P 500 Index – rolling 3-year basis

S&P 500 Index – market breadth since 2008

S&P 500 Index – with and without AI stocks

Russell 3000 Index – drawdowns by sector

STOXX 600 Index – relative performance vs. S&P 500 Index

S&P 500 Index – top contributors to earnings growth

Hyperscalers – actual vs. expected capex growth

Hackers Use Chinese AI Tool to Hit South Korean Banks, Exposing New Risk

Hackers used a Chinese artificial-intelligence agent to attack South Korea’s biggest banks and steal the personal information of 68,000 people, officials said, marking one of the first such AI-powered intrusions into the global financial system.

Investigators in Seoul said the attacks, initially detected last week, hit at least seven South Korean financial firms and showed traces of a cybersecurity tool called Artex AI that was developed in China. The National Police Agency’s cyber terror unit said Tuesday it had opened a probe into the breach.

The attacks were the latest to highlight the vulnerability of even hardened targets to hackers using freely available AI tools. In previous cases, governments and nonfinancial corporations were hit, but it is unusual for banks to fall victim to hackers assisted by AI agents.

Anthropic last year alleged that state-sponsored Chinese hackers used Anthropic’s AI technology to automate break-ins of roughly 30 global targets, including corporations and foreign governments. China at the time accused the U.S. of using cybersecurity to smear and slander Beijing.

Artex is an open-source AI agent developed by Li Puhua, a Chinese cybersecurity engineer who uses the alias Autumn. Open-source means it is free to download and adapt. The agent isn’t itself an AI model but instead draws on AI models to deliver services, like an insurance agent who doesn’t personally insure a home or car but helps homeowners get coverage from insurance companies.

Li designed Artex specifically for cybersecurity uses, aiming to help organizations identify vulnerabilities in their networks. In this case, however, South Korean officials believe malicious hackers used the tool to get into the banks’ systems and steal data of customers and employees.

The stolen data included annual income and personal-loan limits of some customers—information that could be sold to scammers or otherwise traded on the web.

After reports of the first bank breaches emerged, Artex updated its user guidelines to specify that the tool must not be used for unauthorized intrusions, data theft or other malicious reasons.

South Korean authorities called on banks to harden their systems.

This week’s fun finds

Good food and even better company! We’re so thankful for the opportunity to come together, share a meal and celebrate all the wonderful partners at EdgePoint.

Happy Thanksgiving!

Towers of humanity: Soaring pyramids and dramatic tumbles at Spain's castells competition

Teams compete to build towering human pyramids at Catalonia's largest castells competition in Tarragona, Spain.

This week's interesting finds

 

A few charts worth discussing

"Forecasted copper production growth remains in the 1%-to-2% range despite many of today’s big themes (e.g., energy transition and data centres) requiring substantial amounts of the base metal. Electricity demand in the U.S. is also starting to grow after being flat for 20 years.”

- Sydney Van Vierzen

Other charts worth pointing out

Historical property & casualty insurance – combined ratios vs. investment yields

Market breadth and drawdown depth 

Long-term U.S. Treasury performance

Newspaper stocks vs. forward earnings

Software sector performance by category

AI supply chain & semiconductor/storage performance vs. major indices

Asset-heavy vs. asset-light equity performance

Global defense spending as share of GDP

Defense industry orders and shipments

Global infrastructure investment requirements by region

Semiconductors vs. hyperscalers – free cash flow 

Data centre-related construction employment

S&P 500 Index earnings growth by sector

Global credit market starts to sputter as jumbo deals drag

Spreads on global corporate bonds have blown out about five basis points this week, the most since March. That leaves them at their widest in half a year, according to a Bloomberg index. Trading at the start of the global day in Asia on Friday pointed toward more selling, with yield premiums on investment-grade notes increasing 2 to 4 basis points, traders said.

The weakness in credit contrasts with gains in Treasuries after mostly dovish comments from United States Federal Reserve officials. The divergence stands out. Credit has held up well in the past year even when sovereign debt was slumping, prompting many investors to take the view that some companies are safer bets than even the most powerful governments. But record bond sales recently from Paramount Skydance Corp. to SoftBank Group Corp. have added to a surge in supply of corporate debt that’s now giving money managers pause.

While credit markets remain at historically stronger levels despite the stumbles in recent weeks, a number of signals are showing growing investor caution.

After Paramount Skydance Corp. issued US$52 billion of debt this week to fund the biggest Hollywood buyout ever, its junk notes were among the hardest hit in initial trading. That came just days after SoftBank pushed through a US$11.1 billion junk debt deal for which it had to pay record yields, including 9.75 per cent on a 7.5-year bond, in an effort to fund its massive AI ambitions.

Elsewhere in the riskier parts of the U.S. debt market, spreads jumped above 1,000 basis points over Treasuries for the first time since the regional banking crisis in 2023. That follows a steady rise since April as investors began to anticipate the Fed’s next rate hike.

Still, not all investors see a rate move as an indication of underlying stress.

This week’s fun finds

368 farmers gave up part of their land so elephants could cross the valley safely. Trail cameras show 529 already have

African savanna elephants in southern Tanzania have an unusual habit: They climb mountains. Up to 1,000 of the pachyderms spend part of their time in the Udzungwa Mountains, clambering up and down steep slopes that are clad in lush, closed-canopy rainforest.

But some also migrate from the mountains to more typical savanna elephant (Loxodonta africana) habitat that lies to the east, across the Kilombero Valley, in Nyerere National Park.

Fifty years ago, this land was connected by unbroken lowland rainforest, but since then, the forest has been cut down and the valley converted to farmland. This created conflict between elephants and farmers when the pachyderms crossed the valley along their long-established migration routes.

The answer? Give some of the land back to the elephants. The process took seven years, but in April 2025, after seemingly endless preparatory work by STEP and its partners, and hundreds of meetings with officials and residents, the Tanzanian government designated the Nyerere-Udzungwa Wildlife Corridor (NUWC), the country’s the first wildlife corridor to be given official protection. It’s designed to keep elephants out of people’s crop fields.