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ReliaQuest Representative
This podcast is brought to you by relioQuest. Cybercriminals are constantly attacking. They want your data. They want your identity. They want your innovation. RelioQuest fortifies your business with agentic defense AI that detects, contains and eliminates cyber threats in minutes. It helps your security team move faster at the work that matters most to protect the business now and delivers insights to help them predict what's next. ReliaQuest agentic defense for the enterprise. Learn more at reliaquest.com that's R E L I A Q U E-T.com
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Energy Market Analyst
the
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Luke Vargas
US slaps new 50% tariffs on Canada, hurting already lukewarm trade talks plus Mickey Mouse meat, Mac and cheese as Kraft Heinz hopes that Disney can sprinkle some magic on its brands. And we'll look at whether AI native startups offer clues about how all companies could one day be structured.
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Lindsay Ellis
One executive I talked to compared the efficiencies gained with with AI to taking a GLP1 weight loss drug. You can do a lot more with a smaller staff.
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Luke Vargas
It's Tuesday, July 21st. I'm Luke Vargas for the Wall Street Journal, and here is the AM edition of what's news, the top headlines and business stories moving your world Today,
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ReliaQuest Representative
President
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Luke Vargas
Trump has imposed new 50% tariffs on certain goods from Canada, which the White House said was a response to the country's discriminatory treatment of American products. That designation allows the president to impose levies under an obscure section of U.S. trade Law and comes after the Supreme Court ruled earlier this year that emergency tariffs imposed on Canada for its alleged role in the fentanyl trade were illegal.
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Gavin Bade
These levies would hit about $20 billion worth of Canadian goods, including industrial products like cement and consumer goods like wine and hockey stick. And that's only a small slice of total U.S. imports from Canada, which last year totaled more than $380 billion.
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Luke Vargas
That's Journal Trade and economics reporter Gavin Bade in Washington, who says the new tariffs come as the two countries remain at loggerheads over the future of the U.S. mexico Canada Agreement.
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Gavin Bade
That is the trade deal that Trump negotiated in his first term to replace NAFTA and is up for renegotiation this year. Now, the US And Mexico have been making steady progress, and American officials are in Mexico City this week for talks. But the US And Canada have not even opened formal negotiations on the deal yet. That's a problem for the Trump administration, which is trying to extract concessions from the trading partners quickly before the midterm elections could allow Democrats more oversight. In previous rounds of tariffs on Canada and Mexico. The US has largely exempted products that comply with the USMCA agreement, so they were not hit by previous tariffs. But this time, Trump's team said the goods would not be spared and would be hit by the new 50% levy. At the same time, the administration is leaving the door open for negotiations with Canada to begin. The new levies won't take effect for 30 days, and administration officials have emphasized that they remain open to talks with Ottawa. Trump, of course, has routinely threatened tariffs on scores of nations throughout his second term, but has often relented when relations improved. So we'll continue watching this space.
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Luke Vargas
The White House said the latest round of tariffs won't apply to products already hit with so called national security tariffs steel, aluminum, auto parts and lumber. Last year, Prime Minister Mark Carney rolled back many of the counterterrorifs Canada had imposed on US Goods. But several provinces kept in place their own bans on U.S. wine and spirits, something U.S. officials have repeatedly complained about. In a statement, Carney said Ottawa is ready to address outstanding issues with the US to the benefit of both countries. Well, those new tariffs come after Trump accused Canada of poisoning U.S. air after wildfire smoke blanket Ontario and several U.S. states last week. Wildfires are continuing to blaze this week across both sides of the country's shared border, with most of them caused by lightning strikes in remote forested areas. Trent, our Canada correspondent Amanda Coletta explains, isn't expected to end anytime soon.
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Amanda Coletta
Above average temperatures are forecast for much of the country through to August, and the fire danger is also expected to climb as summer progresses. Because of Canada's geography, most of the fires that are blazing in Canada right now are very difficult to contain and they are being left to burn. And to understand why, I think it's important to grapple with the vastness of Canada's forest. So Canada's boreal forest encompasses 1.3 billion acres, and for context, that's an area several times larger than that of all of the national forests in the United States combined. And so when there are so many fires burning across Canada, as there are right now, the focus for authorities is on responding to the fires that are posing a threat to people and to communities and to critical infrastructure.
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Luke Vargas
In recent days, several Canadian provinces have issued air quality warnings as hazardous smoke stemming from American fires drifts north. Prime Minister Carney has said the US Needs to do more to fight climate change, which scientists say is making fire seasons longer and more intense in Canada, where warming is occurring at twice the global rate. And Israeli intelligence believes that Iran has moved thousands of uranium enriched centrifuges into tunnels deep inside its Pickaxe mountain, a recent focal point for President Trump, who threatened to attack it last week. Israel believes that the centrifuge transfer occurred after the US And Israel hit Iran's three main nuclear sites last year, and we exclusively report that intelligence was passed on to Washington. Iran's foreign minister didn't respond to requests for comment about the site, and the White House referred the Journal to interviews that Trump gave about it last week. While the US has stepped up strikes on Iran over the last 10 days, striking pickaxe mountain could prove challenging. Experts estimate the complex where tunnel reinforcement work has been occurring over the last year reaches up to 450ft beneath solid rock. In markets this morning, US stock futures are pointing to a higher open with contracts tied to the NASDAQ 100 leading gains. That's after a rally in Asian stocks as mediation efforts for a new US Iran ceasefire boost appetite for risk. It's a turnaround from yesterday's trading, where shares in Elon Musk's SpaceX closed lower for the seventh straight day. The company's stock has now dropped well below its June listing price, losing more than a trillion dollars in market cap since its peak. The UAE is doubling down on natural Gas Abu Dhabi National Oil company or adnoc, said today that it's moving forward with a more than $6 billion project to tap accumulated gas at its largest offshore oil field. Adam Whitaker covers energy companies for the Journal and says the project is expected to come online by 2030 is significant
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Energy Market Analyst
given the fact that the conflict in the Middle east, which has reignited in the past few days, has once again highlighted how energy infrastructure in the region can be vulnerable to attacks, but also how closure of the Strait of Hormuz can halt energy flows passing through the waterway. Despite that, it's a bet on essentially energy infrastructure and energy hungry data centers needing to be powered. The Asian countries, which are typically buyers of this type of gas, are growing and at the time this is also part of the UAE's wider energy ambitions. Early this year, the country left OPEC, which gives it much more freedom to pump for oil, and at the time this was interpreted as a statement of intent to establish itself more prominently as an energy provider. So the large investments to massively grow its gas production shows that natural gas and LNG will form a large part of this energy ambition going forward.
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Luke Vargas
France's Total Energy, Italy's ENI and the China National Petroleum Company are partners in the ADNOC project and get ready for Cinderella, Mac and Cheese and lightsaber ketchup dispensers. We are exclusively reporting that Kraft Heinz and Disney have struck a multi year deal that'll see the food conglomerate's products served at Disney's North American resorts and allow it to use Disney characters on some of its goods in stores. The deal follows one that Kraft Heinz struck with the NFL to get its condimen into stadiums and comes after CEO Steve Cahelane told investors earlier this year the company was attempting to grow revenue beyond grocery shelves or in industry speak Away from Home we see tremendous opportunities for us in Away from Home based on the strength of our brands and the opportunities in front of us, and this is one of the areas we're investing in. The Disney alliance comes amid a turnaround at Kraft Heinz as the company attempts to revive sales after years of declines. Coming up Could AI native startups offer a vision of the future American workforce? And we'll look at how a $150 billion Wall street strategy could help you to lower your taxes after this short break.
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Steve Booth
I'm Steve Booth, CEO of Baird, an independent wealth asset management and global capital markets firm. At Baird, our 5,000 plus employees are united by an unwavering commitment to excellence and a genuine passion for helping our clients and each other succeed. As a privately held, truly employee owned company, we treasure our independence since we can focus on delivering results to clients and taking care of our people throughout the cycles in our served markets. Learn more@rwbaer.com WSJ.
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Luke Vargas
As artificial intelligence continues to dominate, talk about how companies will operate in the near future and what that means for the U.S. workforce. The newest generation of startups might offer a vision. Journal reporter Lindsay Ellis writes that companies infused with AI from the start not only have fewer workers, but also a flatter management structure.
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Lindsay Ellis
If we look at how they structure operations, how they use this technology, even kind of what they expect out of their staff, it can offer just really interesting clues for what work is going to look like for the rest of us as this technology gains a firmer hold in the workplace. These founders told me that it really is sort of woven through every part of the business, even thinking about how individuals see their roles. So you wouldn't necessarily just have a manager anymore overseeing a team or a team of teams as we see in some corporations, that manager would need to be contributing individually overseeing agents who are doing the work, maybe having a direct report, but it really is what they call a player, coach, model so that everybody is getting their hands dirty. And there are fewer layers between the bottom rung of the corporate ladder and then the top executive ranks.
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Luke Vargas
As to what AI will do to the wider workforce, Lindsey says that some think that efficiencies and leaner companies don't necessarily mean fewer jobs.
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Lindsay Ellis
There's an acknowledgement that it could be smaller. When I talked to Rem Koenig, who's the entrepreneurship professor at Harvard Business School, and asked him is this going to mean an uptick in unemployment? And he wasn't so sure and said that yes, these AI native startups have smaller headcounts, but the ease of this technology may make it easier to form businesses, and so the uptick in business creation might offset that. But I do think he would agree with that, that smaller teams are likely.
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Luke Vargas
And you can hear more from Lindsey on the latest episode of our Tech News Briefing podcast. And finally, here's a relatively good problem to have with stock markets near record highs, wealthy investors are running out of loss making investments to help offset their tax bills. To fix things, wealth managers are using an investment strategy called Tax Aware Long Short, a strategy now worth over $150 billion. WSJ's take on the week sat down with Tax Alpha Insider founder Brent Sullivan to explain how it works.
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Steve Booth
Every time somebody rebalances for routine risk management, maybe they have lifestyle expenses, they're selling securities. Every single time that they do that, they're incurring capital gains. And so is there a way to defer that capital gains bill? And there is using tax loss harvesting. That's a simple strategy. We're just trying to net losses and gains. And what that does is not eliminate the tax bill. It just pushes it into the future. And as you push it into the future, you can think about it as like a free loan from the government. And it grows faster than the time value of money. It grows at the portfolio value. So that's oftentimes highly valuable.
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Luke Vargas
And for more on that investment strategy, check out the link we've left in our show notes. And that's it for what's news for this Tuesday morning. Today's show was produced by Hattie Moyer and Daniel Bock. Our supervising producer is Sandra Kilhoff, and I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a new show and until then, thanks for listening.
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ReliaQuest Representative
Fusion powers the sun and stars General Fusion is working to bring the zero carbon abundant energy source to Earth. As global electricity demand surges, Fusion has the potential to deliver clean, scalable power for a growing world proudly Nasdaq listed. General Fusion is the first publicly traded pure play fusion energy company in the world. With its magnetized Target fusion technology and operational demonstration machine, General Fusion is advancing toward commercialization, targeting a first of a kind Fusion plant around 2035. Learn more@generalfusion.com.