Last spring, New York City mayoral candidate Zohran Mamdani proposed a “$30 by 2030” minimum wage for New York City workers.1 Ambitious strategies to raise wages and lower costs are needed given that New York City’s current $16.50 minimum wage is inadequate compared with any reasonable measure of a living wage in the city.

Without a policy change, we project there will be 1.68 million NYC workers earning less than $30 an hour in 2030, or 36.7% of the city’s wage-earning workforce. It is likely that the vast majority of these workers would experience significant wage gains if a $30 minimum wage were implemented.

An enormous body of research on the effects of higher minimum wages has shown that past minimum wage increases have meaningfully raised pay for low-wage workers without causing significant increases in unemployment. However, the “$30 by 2030” proposal would go beyond the levels of minimum wages studied in past research, making it more difficult to precisely estimate the number of workers who would benefit and any additional impacts of the measure, such as reductions in hours or employment.

New York City’s current minimum wage does not come close to a living wage

NYC workers face some of the highest living costs in the nation. EPI’s Family Budget Calculator (FBC) measures the income a family needs to attain a modest yet adequate standard of living in every U.S. county. The FBC thresholds are conservative amounts: they account for necessities like housing, food, transportation, health care, and child care but do not provide any allowance for savings for retirement, emergencies, or college. As Figure A shows, a family of two adults and two children in the Bronx faces annual costs of nearly $135,000.2 In Manhattan, these costs are greater than $167,000 a year. For a single adult with no children, annual costs range from $62,913 in the Bronx to $87,038 in Manhattan.

Figure A

With the FBC cost data we can estimate a living wage that would allow workers to support their families.3 Table 1 shows that the living wage in 2025 is already above $30 an hour in Manhattan ($33.89), Queens ($31.31), and Staten Island ($30.68). While Brooklyn and The Bronx do not exceed this threshold, the costs facing these families will almost certainly continue to rise between today and 2030. These figures make it clear that discussions of a $30 minimum wage in New York City are not superfluous—they reflect the very real needs of working people throughout the city.

Relative to the actual living wage, New York City’s minimum wage is significantly lower than many other high-cost-of-living cities in the country. NYC’s $16.50 minimum wage is around half of the living wage in most of the city’s boroughs. By comparison, the minimum wage is around three-quarters the estimated living wage in Seattle, Washington D.C., and Los Angeles. Chicago’s and Denver’s minimum wages are each more than 80% of a living wage, while the minimum wage is 69.3% of the living wage in San Francisco. All these cities have room to push for higher wages for their workers, but it is clear that New York City’s minimum wage leaves workers further behind than many other major cities in the country.

It is notable that among the cities in Table 1, those with local control over minimum wage policy have been significantly more successful at approaching living wage targets. While New York City’s minimum wage is higher than the upstate region, the policy is currently set by state lawmakers in Albany, not at the local level. Boston (Suffolk County, MA) uses the Massachusetts state minimum wage of $15.00, which is around half of the living wage in the city. Portland, OR, also has its minimum wage set by state lawmakers and has a slightly stronger minimum wage floor (69.8% of the living wage), but every city with a wage floor of at least 70% of the living wage has local control over the policy.4 This pattern suggests that when given the power to do so, local government officials are more responsive to the wage floor needs of workers in their city.

Without a policy change, 1.68 million New York City workers will be paid less than $30 an hour by 2030

Under the status quo minimum wage policy in New York City, we project there will be 1.68 million workers earning less than $30 in 2030, a little more than a third (36.7%) of the total wage-earning workforce in the city. These workers would likely be directly affected by the minimum wage increases in Mamdani’s policy proposal. In addition, economic research shows that workers already earning above the new minimum wage also typically benefit through spillover wage effects as employers seek to maintain organizational wage ladders.

Most minimum wage research finds that increasing the wage floor significantly increases earnings for affected workers, while causing little to no loss in employment. That’s because businesses are able to adjust to increased labor costs through modestly increasing prices, reductions in turnover, and the movement of workers from less-productive firms to more-productive firms.

Moreover, even if a minimum wage increase did result in reduced employment, it’s important to understand what that actually means for low-wage workers. The low-wage job market is characterized by high levels of turnover and churn, as workers are typically always looking for any new position that will offer them more livable pay. Many low-wage workers also spend some portion of the year not employed—due to care responsibilities, participating in education or training programs, or seeking other work. In this context, what researchers would describe as reduced employment does not mean that some set of workers will now be permanently unemployed. Rather, it likely would mean that some low-wage workers would work fewer hours over the course of the year or spend more time between jobs. Of course, these workers would now be earning more per hour when they do work because of the higher minimum wage—what really matters is the net outcome on their annual earnings.

We are cautious about extending the general conclusions of minimum wage research on employment to a $30 minimum wage in New York City. The proposal is more ambitious than the levels that economists have studied extensively. One tool economists use to assess the “bite” of a minimum wage is the minimum-to-median-wage ratio (sometimes called the “Kaitz index”). When underlying wages in the labor market are higher, as proxied by the median wage, the minimum-to-median-wage ratio is lower, and a given minimum wage affects a smaller share of employment. For example, a $17 minimum wage will have a much smaller effect on workers and employers in a higher wage place like New York City than it would have in places where wages are generally much lower.

Table 2 estimates the minimum-to-median-wage ratio for a $30 NYC minimum wage in 2030, as well as other wage thresholds. The ratio of a $30 minimum wage in 2030 would be around 0.76, higher than most other policies in the U.S.5 In a 2021 paper, economists Arindrajit Dube and Attila Lindner compared minimum-to-median-wage ratios across the 10 most populous U.S cities with minimum wages above the state level and found a population-weighted average minimum-to-median-wage ratio of 0.64.6 At the time, Los Angeles’s minimum wage had a Kaitz index of 0.75, but this policy has not been studied enough to understand its employment effects. According to Dube and Lindner, most state minimum wage policies greater than the federal minimum sit at a minimum-to-median-wage ratio of around 0.50. Among international peers, it is notable that the United Kingdom officially targets a minimum wage policy that is two-thirds the median wage (ratio of 0.67). Other Organization for Economic Co-operation and Development (OECD) countries also have high minimum-to-median-wage ratios, including France (0.62), New Zealand (0.69), Mexico (0.74), Chile (0.75), Costa Rica (0.87), and Colombia (0.92).

The cost-of-living crisis in New York City requires bold steps forward as part of a cohesive strategy to create a more equitable economy. Increasing the minimum wage should be one key part of this strategy, which must also include tackling the cost of housing, child care, and health care. The experience of other high-cost cities also indicates that local lawmakers are better positioned than state officials to set appropriate and livable minimum wages for their jurisdiction’s workers. New York state lawmakers can be much more ambitious in setting high standards for New York City, but it likely would be better to let the city set its own wage standards above the state floor, much in the same way that states can set their own minimums above the federal minimum.

Table 1 Table 2

Notes

1. The proposal also calls for indexing the minimum wage to inflation or productivity increases, whichever is greater, thereafter. The tipped minimum wage in New York is set at two-thirds the regular minimum wage.

2. The FBC data is organized by county, but for the purposes of this analysis we refer to the corresponding New York City boroughs.

3. Gould, Mokhiber, and deCourcy (2024) suggest living wages can be approximated by 81% of the associated FBC thresholds because middle-income families receive about 81% of their income through wages and 19% from other non-wage sources, including government transfers (such as refundable tax credits) and non-wage market income (such as interest on savings).

4. Of course, any state action is more beneficial than using the stagnant federal minimum wage, which is still the effective wage floor in Philadelphia, Dallas, Houston, and other cities in states where local minimum wage increases are preempted. These localities all have effective minimum wages that are less than half of the living wage.

5. Our projections assume a nominal annual wage growth of 3.3% based on Congressional Budget Office (CBO) projections of the Employment Cost Index. If we vary this assumption ±0.5%, the outcomes of a $30 minimum wage in 2030 vary as follows: Kaitz ratio: 0.73–0.79. Share of workers under $30 an hour: 36.0%–40.0%.

6. At the time New York City had a 0.66 Kaitz index, higher than it does today (approximately 0.5).

James Bradshaw of the Globe and Mail reports AIMCo earns 2% first-half return as clients seek to reduce risk-taking:

Alberta Investment Management Corp. earned a 2-per-cent return in the first half of the year, rebounding from a volatile first quarter that has prompted the pension fund manager’s clients to shift toward lower-risk investments.

AIMCo’s investment gain through June 30 was modest when compared with a 5.4-per-cent gain in the same six months last year. Its balanced fund, which reflects a typical mix of client assets, earned 2.1 per cent, according to a midyear update the pension fund manager released on Wednesday.

After a tough start to the year for markets, marked by turmoil from constantly shifting tariffs levied by the United States, AIMCo and its clients are “quite pleased with a positive return year-to-date,” chief investment officer Justin Lord said in an interview.

A second-quarter rebound in stock markets helped keep AIMCo’s returns positive, and that upward trend has carried into the third quarter, Mr. Lord said. But as its client funds adapt to a less predictable investing environment, they are asking AIMCo to lean toward assets that are typically less risky.

In some cases, they are moving more of their investments into infrastructure-like assets that have longer time horizons and more stable returns. Some are still having conversations about boosting exposure to private credit, a booming market for loans to private companies, even as increased competition has put pressure on credit spreads.

“We have been seeing some allocation changes across client portfolios away from a global equity tilt to lower-risk jurisdictions or asset classes,” Mr. Lord said.

So far, that has not included any retreat on U.S. investments, though AIMCo is taking a harder look at the risks posed by less predictable U.S. policy positions and tensions with its trading partners.

“The U.S. isn’t going away. We don’t see drastic changes to that allocation,” Mr. Lord said, but he added: “With a perceived increase in risk comes a required increase in expected returns.”

Mr. Lord was promoted to chief investment officer in July as part of an overhaul of AIMCo’s senior leadership team instigated by Alberta’s government, which called for a “reset” of the government-owned fund manager.

AIMCo invests on behalf of 17 pension, endowment, insurance and government clients in Alberta. Its total assets increased to $182.9-billion, compared with $179.6-billion at the end of 2024.

Over the past 10 years, AIMCo’s balanced fund has earned an average annual return of 7 per cent, reaping net investment income of $69.9-billion.

First-half returns this year were driven mostly by gains on publicly traded assets such as stocks and bonds, which make up a majority of AIMCo’s portfolio.

Investments in privately owned assets such as infrastructure, real estate, private equity and renewable resources – which account for 35 per cent of AIMCo’s total portfolio – had “more tempered” first-half results, according to the pension fund manager’s midyear update.

AIMCo publishes detailed performance results for each asset class with its annual report. 

Earlier today, AIMCo released its mid-year investment performance:

 

This morning I had a chance to speak to AIMCo's newly appointed CIO, Justin Lord, to go over the results and dig a little deeper (first time we spoke, very nice guy and market savvy which I expected).

I want to thank Justin for taking the time to talk to me and also thank Carolyn Quick for setting up the Teams meeting and sending me the update on an embargoed basis. 

I began by asking Justin to give me an overview of the results which were in line with peers:

A couple of comments and certainly 2025 has been anything but a quiet year in global financial markets. That's probably been the norm that investors have been operating in over recent years, it certainly feels like that across the teams here at AIMCo.

Obviously, January to June, investors faced a rapidly changing environment that was driven primarily by US tariff announcements, continued geopolitical tensions and escalation or thereof and uncertain macro, monetary and fiscal backdrops globally.

The AIMCo Balanced Fund did deliver 2.1% net return over the first half of the year. That means approximately $3.6 billion of investment gains for our clients. 

This performance was led by our public market portfolios, particularly public equities driving those returns. We did have positive returns across money market, fixed income, mortgages, private debt and loan portfolios as well.

Our private investments like infrastructure and real estate were slightly challenged by the same that we commented on with respect to the macroeconomic uncertainty broadly.

As it relates to fixed income, Canadian bond yields were pushed higher. We've seen that continue at the long end of the curve mid-year reflecting concerns over the impact of trade policy, uncertainty over business investment, economic stability and broader long-term productivity.

But pointing to the results and really pointing to the benefit of a highly diversified portfolio, sound risk management practices, the long-term performance of the Balanced Fund has held up quite well through this volatility.

We do note that our Balanced Fund has earned a 10-year annualized return of 7% as per the report as well. 

Our teams at AIMCo continue to seize opportunities and effectively mitigate risks on behalf of our clients to deliver solid performance throughout market cycles.

We do provide our clients with regular, detailed performance on these portfolios and this report is provided just to provide a snapshot of that performance across the aggregated portfolio.  

We do reference Balanced Funds in our reporting because it reflects the typical client mix of investment across all asset classes. It does account for the majority of assets under management at AIMCo.

We don't provide reporting against our benchmarks in our mid-year report. We have some asset classes outperforming or exceeding their benchmarks while others are lagging or below.

Just as a follow-on, post the end of quarter, obviously we've seen continued appreciation in equities broadly. Certainly post the quarter and Q2 and following on, US large cap equities have re-assumed a leadership but we are seeing broad based gains across emerging markets, Canadian equities and European equities year-to-date contributing positively and continuing to do so for our clients' funds overall.    

Justin paused there to let me digest and I do want to emphasize that while AIMCo has many clients most of the assets are in the Balanced Fund and that fund really demonstrates the benefits of a broadly diversified portfolio.

No, they do not provide detailed reporting by asset class relative to respective benchmarks in their mid-year report but do provide it to their clients which is normal.

I followed up by proposing we discuss public markets first since that's his area of expertise and then we discuss challenges specific to private markets.

I asked him to give me an overview of public market strategies/ activities including internal and external absolute return strategies and asked him whether private debt is part of the fixed income portfolio or part of private equity.

He replied:

Yes, certainly, I will tackle public equities first and then we will move on to private debt.  

Public equities including the absolute return strategies makes up approximately 37% of the clients' Balanced Fund asset mix. This is across global equities, Canadian equities and emerging markets. We do have a global small-cap product that is quite small and then our absolute return product.

Clients allocate at the asset mix level to those products as needed to meet their risk/ return requirements. We work with our clients' investment staff, consultants, etc. to help determine what those products should look like from a composition or active risk perspective and obviously clients are involved in helping set those benchmarks at the asset allocation level. 

The team internally uses a number of different strategies internally and externally to allocate to active and passive strategies as well as absolute return strategies to ensure we are delivering that beta required at the asset mix level and then certainly targeting excess return on top of each of those benchmarks for the respective products.

I interjected to ask him if that's an overlay strategy, a portable alpha strategy and he responded:

Yes, that's correct. As you know security selection over the last couple of years has been difficult to add value in global equities and around US large cap equities. 

If you're looking at the top quartile active manager in US equities, they actually detracted value over the last four year period and that's owing to some of the items you spoke to peers with respect to market concentration, etc.  

We have more tools in the toolbox so to speak than just security selection. The use of absolute return strategies to add value or generate excess return on top of equity beta is a key component for achieving client targets from an excess return perspective while managing risk, diversification and reducing correlation of those alphas across the products in general. 

Depending on the product description, there will be varying degrees of overlay strategies that will be used in Canada vs global or emerging market strategies. 

Security selection has generate positive returns for us and more broadly for the universe in emerging markets given dispersion that is prevalent and owing to some perceived inefficiencies in those markets. Certainly an area where we think security selection can continue to add value. We've been more reliant on absolute return strategies, portable alpha strategies, global equities for excess return in general.

Some of our peers would take a similar approach but at the total portfolio level. As we are organized as an asset manager, our clients are changing their asset mix at the total portfolio level, asset return happens to fall within our tool set in public markets. 

I noted that it's certainly fair to say that concentration risk in US large cap equities is affecting all pension funds and institutional asset managers, making security selection there a lot more difficult and also impacting private market benchmarks as they are gauged against US and global markets dominated by US securities (US large caps make up more than 60% of the MSCI Global Index).  

It's also worth noting that AIMCo is similar to BCI and CDPQ as it's a pension fund that manages assets for many clients with different demographics and liabilities so they work with them and their investment staff and consultants to recommend the optimal asset mix but the asset mix final decision lies with clients. 

I shifted my attention to currencies as all peers reported varying degrees of losses as the US dollar got hit over the first six months.

Justin responded:

We do have US dollar exposure and this has certainly been a topic of conversation with our clients overall. They've been asking similar questions, have similar concerns as the broader institutional investment community. 

As mentioned, we work with clients to build their long-term portfolios based on those sets of individual goals whether they are pensions or endowment plans. Any changes to our product platform would take into account those concerns, opportunities or potential shift in asset allocation more broadly.

Some of our clients do have hedging policies described in their SIP&Gs (statement of investment principles and governance). There has been interest in a better understanding of F/X exposures, hedging strategies, certainly brought to the forefront based on the long-term outlook for the US dollar.

We haven't seen any major changes as of late. Our own view is while there is a lot of noise surrounding the US dollar, we do expect it to retain its reserve status for now. 

We have seen client allocation shifts perhaps reducing that US equity exposure more as a function of valuations and lower capital market assumptions, lower return assumptions for global equities over the coming years. And that's really a function of the current valuation backdrop in equities.

Those funds are being reallocated across depending on the client and risk across different asset classes: private credit being one of those, some clients looking at infrastructure allocations as well as fixed income or some duration exposure at the current date.

As you'll note by the release as well, just given the asset mix composition, our clients might be less exposed to the illiquid asset classes at approximately 34% of their asset mix at the Balanced Fund.

I'll come back to your private debt and loan question now, that sits within our Private Markets team but works very closely with our Public Market Fixed Income team given the overlap in risk characteristics and similarities as well.

When talking about the impacts of reallocating capital from global equities to private debt and loan, that asset class naturally increases our exposure to Europe given the footprint the team has across the European credit market. 

I asked him what is the exposure and approach for private credit, do they also use strategic partners to ramp up their exposure there?

He replied:

Private debt and loan is approximately 9% but that would include mortgages as well so we'd be about 5% of Private Debt and Loan as an asset class as an allocation level within AIMCo. 

This strategy is benchmarked to a combination of private credit indexes as you'd expect. 

The team managed by Peter Shen under Peter Teti manages a strategy that really does lever strategic partnerships and opportunities across our platform in both a fund, direct or co-invest fashion more broadly.

We have seen more competition for capital in that space as a number of clients both institutionally and across the investment landscape are increasing allocations to that space in search for return and certainly as a function of elevated valuations in large cap equities. 

The team has done a very good job of remaining disciplined, maintaining high credit quality in the portfolio and looking for those relative value opportunities across the asset class within the sub categories of the private credit asset class to meet and exceed their targets quite effectively with very little loss ratio over the last number of years.  

I told Justin that AIMCo's former CIO Dale MacMaster once gave me a crash course in private credit explaining how floating rates provide an embedded inflation protection and they were targeting high single-digit returns. 

He agreed: "Yes, it's predominantly a floating rate product and offsets some of the inflation risk embedded within the traditional fixed income space."

I then quickly moved on to private markets where I noted higher for longer is impacting private equity and real estate and some infrastructure, and also noted that AIMCo is more exposed to office buildings in Alberta but let him give me more details.

He replied:

On the private equity front, certainly transaction activity has been challenged in the private equity world and continues to remain muted. That's impacting distributions received by LPs in general comparing to historic levels.

We are seeing some secondary activity in a few places that is demonstrating the GPs ability to raise liquidity.

I'd say we are cautiously optimistic with respect to capital markets, the IPO pipeline as a source of liquidity for private equity but will reiterate cautiously optimistic over the next 12 to 18 months. The industry is certainly working through some of the exposures and fundraising over the last five years.

We still are extremely confident in the asset class as a whole. Peter Teti and the team have done a fantastic job managing the exposure over the last number of years and have produced results that have met or exceeded our clients' expectations. 

Difficult backdrop with public markets as a benchmark right now, difficult to assess over shorter periods of time as well and would refer to our long-term strategy there over equity benchmarks more broadly.

I also noted it's a mid-market focus in PE and he told me that has not changed. 

He moved on to Real Estate and Infrastructure:

With respect to Infrastructure, also noting some of the market volatility, geopolitical volatility creating some challenges in the space. We continue to have conviction in the long-term businesses within our portfolio remain vigilant on inflationary pressure, interest rate movements, other risks that are related to evolving global economic uncertainty.

Our portfolio appears to be well positioned currently and we would note the potential for increased activity in the future as it would relate to client allocations and some of the potential infrastructure spend that is being talked about more broadly in North America and Europe as it relates to responding to some of the geopolitical trade tensions, etc..

Ben Hawkings and the team, like our PE team, have done a fantastic job over the last number of years managing the portfolio. We have a fantastic suite of partners and a capable team internally from a direct perspective to navigate the current environment.

I told Justin that I spoke to Ben Hawkings  back in November 2022 (see comment here) and more recently covered his comments on the success of the AirTrunk sale and think very highly of him. 

I also told him I liked Albert Premier Danielle Smith's post on LinedkIn yesterday on how nuclear energy is Alberta's next frontier and think AIMCo's Infrastructure team can play an important role there if the opportunities arise and it meets clients risk/return objectives: 

 

We continued on to AIMCo Real Estate portfolio where I noted there are still challenges in some sectors but it seems to finally and slowly be turning the corner.

Justin replied:

As like most of our peers, Real Estate has been a challenged asset class over the last number of years. 

Policy uncertainty continues to affect the recovery in that sector. As you know, real estate responds to interest rates. Interest rate increases combined with economic uncertainty more broadly have caused a cyclical decline in the market.

I would say over the last six months we are starting to see liquidity returning to the market, signs of a bottoming in some sectors and some interesting deal flow as well. 

The foreign real estate portfolio particularly in the US continues to show some sign of strain due to further decline in some office exposures and some specialized sectors. We do expect this to moderate through the end of the year and into 2026.

Other markets such as Canada and Europe we believe have stabilized more quickly but there are continuing risks there that remain as a function of global trade, tariff actions, etc. 

The pandemic produced further structural changes in tenant needs but the team is focused on that, both portfolio management and positioning, being able to take advantage of opportunities as they come our way.

I can't speak specifically as to the active weights across our peers but we have had a slight overweight in Office that adversely impacted the portfolio.

As we work through the strategy revamp with the team in Real Estate, we really are focused on a number of top-down investment themes be it demographic shifts, healthcare, technology, structural housing supply or shortages as key themes for portfolio positioning and deal flow.  

I asked Justin if they named a new leader for the Real Estate group and he told me Peter Teti is leading that group for now as he's in charge of Private Markets but he added "we will be looking for a new head of that asset class very quickly, Peter and I are having discussions on that process now."

I asked him if anyone will be replacing him in Public Markets and he replied:

From a Public Markets perspective, we have a strong leadership team with Jason Chang leading Fixed Income and David Tiley managing Fundamental Equities. 

We have a couple of initiatives withing the Public Market portfolio broadly as we look to assess the efficiency of beta management and the consistency of alpha generation.

So, when looking at one of my main objectives over the first three to six months in the role, Public Markets focus on the efficiency and consistency of alpha generation and really designing the strategy and structure that is required for our clients to be successful on that front.

As it relates to Private Markets, we touched on the Real Estate focus more broadly. 

I'd just add a third comment, really integrating our client portfolio management process to the investment process is the third key item I'm focused on.    

I ended by asking him what keeps him up at night, noting it's been an insanely volatile year so far, but inflation risks are rising, valuations are high and I asked him if he thinks markets will be calming down or if there are material risks that will lead to a significant retrenchment in the appetite for risk assets. 

He replied:

Not to provide an overly commoditized answer, those items in no particular order would be geopolitical tension, trade and policy uncertainty. Any sudden and unexpected change in monetary and fiscal policies globally. 

Really the next shock to global markets is really a surprise involving any one of those broad categories that I mentioned. The result will be disruption in liquidity trade, consumer activity, consumer sentiment thereby impacting valuations.  

It is concerning to enter an environment like that with high valuations. High valuations equals more downside in those periods of uncertainty.

But I'd say we combat that uncertainty by portfolio diversification, by maintaining sufficient liquidity across our products and client portfolios to be able to respond to those scenarios.

Last but not least, perhaps most importantly, having the right team in place to be able to respond to those opportunities that arise in those situations when managing a portfolio is key.

I thank Justin Lord for a great discussion and judging by my first conversation with him, he's a truly solid CIO who knows his markets, products, clients and values his internal team across public and private markets.

Who knows, he might make me rethink my conviction that Dale MacMaster remains AIMCo's best CIO ever but he has many more years to go before I change my mind on that.  

In all seriousness, Justin is a great guy, glad we spoke, look forward to speaking with him again and AIMCo's clients and staff are lucky to have him as their CIO. 

Once again, the in-depth discussions I bring my readers cannot be found in newspapers or anywhere else so I thank everyone who supports my work and truly appreciate it.

Below, AIMCo CIO Justin Lord offers some insight on the mid-year results.

Also, Alberta Premier Danielle Smith says she expects the private sector to lead the way on potentially bringing nuclear power to the province. (Aug. 25, 2025) 

Smart lady, one of the few politicians in Canada that knows what she's talking about and isn't afraid to tell it like it is.  

Anyway, as I stated above, don't be surprised if in the future AIMCo owns a stake in a nuclear power plant in Alberta (if it makes sense for all parties, why not?). 

The start of this summer brought dangerous heat waves to the U.S. that killed at least two people, including a letter carrier in Dallas (the second letter carrier death due to extreme heat in three years). Labor unions and public health advocates have long been pushing the federal government to enact a standard to protect workers against extreme heat exposure. These efforts led to progress in 2024 when the Occupational Safety and Health Administration (OSHA) formally proposed a new heat standard based on years of intensive research. This summer, OSHA held informal hearings on the proposal, but whether and in what form the Trump administration might move forward with adopting a final version of the heat standard rule remains uncertain. In the meantime, states have every reason to move forward with enacting their own strong standards to protect workers from preventable heat illness and death on the job.

The human and economic costs of extreme heat

Heat is the leading cause of death among all weather-related fatalities, killing 177 people last year alone and at least 211 workers between 2017 and 2022. We know that existing data on heat-related workplace fatalities significantly understate their true incidence and that, as climate change leads to more frequent and intense heat waves, these numbers will only rise. Despite this, 43 states and D.C. have yet to take action to prevent heat deaths. With federal rulemaking now in limbo, it is more imperative than ever for states to act quickly to protect workers from the growing danger of heat exposure.

Like workplace deaths and injuries in general—and due to occupational segregation and geographical factors—the ­­impacts of extreme heat are distributed unevenly based on income, race/ethnicity, and immigration status. The lowest-paid 20% of workers suffer five times as many heat-related injuries as the highest-paid 20%. And Black, Hispanic, and immigrant workers face higher exposure to extreme heat because they are more likely to work in high-risk industries like construction and agriculture.

While workplace deaths are the most urgent consequence of extreme heat, heat is also responsible for thousands of illnesses and injuries every year that result in unexpected health care costs, missed workdays, lost wages, and productivity declines that cost both workers and their employers. Overall economic costs are staggering: Short-term heat-induced lost labor productivity costs the U.S. approximately $100 billion annually and these costs will only increase as climate change worsens. Without emissions reductions or sufficient heat adaptations, labor productivity losses may double to nearly $200 billion by 2030 and reach $500 billion by 2050.

If no action is taken to mitigate the growing risks of extreme heat exposure, the hottest states will suffer the gravest economic consequences. Researchers at the Union of Concerned Scientists estimated annual earnings at risk for workers in each state across seven of the most heat exposed occupations.1 Southern states make up nine of the 10 states where workers stand to lose the highest average annual earnings (see Figure A). Texas will be one of the hardest hit; it’s projected to lose a cumulative $110 billion in labor productivity by 2050.

Despite these economic risks, some Southern states are standing in the way of protecting their own workers and businesses. Texas and Florida—which accounted for almost half of all heat-related severe injuries in the construction industry between 2015 and 2023—have failed to adopt statewide heat standards and banned cities and counties from passing local heat standards.

Figure A

Even though the economic harms of heat-related injuries, illnesses, and deaths are well documented, new heat standard proposals regularly face significant opposition from industry interests who claim, with little evidence, that protections will be too costly to implement. While exaggerated claims and fearmongering are consistent with a long history of industry resistance each time OSHA has proposed new standards, suggestions that a heat standard would disrupt business aren’t backed by available evidence. In its own regulatory impact analysis of the proposed heat standard, federal OSHA estimated that savings to employers are projected to outweigh any implementation costs by $1.4 billion each year.

Existing models provide roadmap for states to adopt or strengthen their own heat standards

Years of research and experience have produced clear guidelines for evidence-based, effective standards that states can now adopt quickly and with confidence. The strength and effectiveness of existing heat standards varies across states with respect to which workers are covered and what steps employers must take to prevent extreme heat exposure. All state heat standards (except for Nevada’s) set a temperature threshold above which employers are required to provide workers with water and shade. Most states also set a high-heat threshold above which additional precautions must be taken to protect workers. Many states also mandate an acclimatization period for workers to adjust to working in high temperatures, but the length of that period varies across states. All states with heat standards mandate that employers train workers on heat illness prevention, monitor workers for signs of heat illness, and have a plan to respond to heat illness emergencies.

A strong state standard should, at a minimum:

• Cover all indoor and outdoor workers;
• Include temperature thresholds to mandate precautions like water, rest, and shade;
• Guarantee an acclimatization period;
• Designate a high-heat temperature threshold at which additional precautions apply; and
• Impose no new costs on workers, meaning that workers should be paid for rest breaks and time spent acclimatizing.

Seven states have already implemented heat standards: California, Colorado, Maryland, Minnesota, Nevada, Oregon, and Washington. While California, Washington, and Minnesota were early adopters of heat standards, advocates have built tremendous momentum toward the adoption of new standards in additional states in the past two years. In 2024, Colorado, Maryland, and Nevada all passed new heat standard laws and California expanded its existing heat standard (originally covering only outdoor work) to cover indoor workers. This year, 18 state legislatures proposed new heat standards, including bills in states like Illinois and New Jersey, that outline elements of comprehensive, evidence-based standards that other states can use as models. 

States with existing standards should review checklists for a strong heat standard as well as model legislation in states like Illinois and New Jersey to audit their regulations and strengthen them if needed. States without standards should build comprehensive, effective standards that follow these evidence-based recommendations, cover as many workers as possible, and include clear, enforceable measures.

States should act now to limit harms to workers, businesses, and state economies while federal rulemaking is in limbo

The fate of the proposed federal heat standard now under consideration could eventually reshape the heat standard policymaking landscape, but in the meantime, there is no downside to states taking action. The current proposed federal standard is fairly strong, a testament to years of research, advocacy, and community mobilization. However, given the Trump administration’s hostility toward workers and industry lobbying groups’ strong opposition to the proposed standard, possible outcomes include the adoption of a weakened standard or long delays in formalizing the proposed rule to effectively block its implementation. 

Some industry representatives opposed to the current proposed federal standard have indicated that, instead of continuing to block the federal rule, they may support the passage of a weak standard in order to stave off future rulemaking. Some have speculated that industry interests may support modeling a weak federal standard on Nevada’s months-old, untested state standard, which has no temperature threshold and has been characterized as “almost as bad as no heat standard” by worker advocates.

There are three possible outcomes of the federal heat standard rulemaking process: 

1. The Trump administration finalizes the proposed, strong federal heat standard. If a strong rule is formalized, states should (and must) adopt it. A strong federal rule protecting all workers from the effects of extreme heat is the best-case scenario. Under this scenario, states where employers and workers have already gained experience with strong state heat standards will be better prepared to implement the federal rule.
2. The Trump administration abandons/indefinitely delays action on the current proposed federal heat standard. If no federal rule is implemented, states will retain latitude to continue enacting their own heat standards. Under this scenario, states with strong, effective standards will help workers and employers immediately reap important safety and economic gains as climate change continues to increase risks of human and economic damage from extreme heat.
3. The Trump administration finalizes a weakened version of the federal proposal. In this scenario, states under federal OSHA jurisdiction would be required to follow the new federal standard and states with OSHA “state plans” could continue to enact/enforce stronger heat standards. It is also likely that any new federal standard could face legal challenge (delaying its implementation), so having a strong track record of effective state standards in place would remain critical for building additional legal and political pressure to eventually enact a stronger federal standard. Likewise, given likely legal delays, even under this scenario, states under federal OSHA’s jurisdiction would be able to continue to enforce their own standards until any new federal rule were upheld in court and any stronger state law had been blocked by a federal court order.

In short, states have every reason to enact strong, effective heat standards and no reason to wait on uncertain federal action. There is zero risk for states who act now and great dangers associated with waiting while workers and businesses alike continue to suffer.

Amid federal backsliding, state lawmakers can act to protect workers from deadly heat

Over 144 lives have already been lost to heat-related hazards since federal rulemaking began four years ago to establish a long-overdue federal OSHA heat standard. Given the possibility that the Trump administration could block or delay the proposed federal standard—or worse, weaken it to try to preempt more effective state and local standards—state lawmakers should move quickly to implement strong heat standards of their own, prevent more deaths and illnesses, and bolster their state’s economy against the damaging effects of extreme heat.

1. The research was conducted in 2021. Given the limited number of occupations considered in these wage loss estimates, recent federal reversals of major policies intended to address climate change or accelerate the clean energy transition, and documented increases in global warming since 2021, these estimates are likely extremely conservative.

Sarah Rundell of Top1000funds reports on BCI's masterclass in private debt:

British Columbia Investment Management Corporation (BCI), the C$295 billion ($214 billion) asset manager for public sector bodies in Canada’s western most province, oversees a C$20 billion ($14.5 billion) allocation to private debt in a strategy that is defined by a few key characteristics: a large and growing allocation to co-investments, an avoidance of mega deals and an expansion into Europe and APAC.

Around 65 per cent of the private debt allocation is direct or in co-investments via partnerships with external firms, which although not unique, sets BCI apart from many other investors and reaps benefits like diversification, deeper relationships, deal selectivity and lower fees.

“Not everyone can do direct or co-investments but having an overall portfolio of 65 per cent in direct and co-investments is a high number, and we are looking to do more,” says Daniel Garant, executive vice president and global head of public markets, in conversation with Top1000funds.com.

BCI has been doing direct lending in the US ever since the portfolio was launched in 2018. But moribund M&A activity continues to push private credit firms to jump on every opportunity. It’s drawn huge investor flows into US private debt and tightened credit spreads. The fiercely competitive market for lenders has propelled BCI into new geographies – first Europe and more recently, Asia Pacific.

“For the last three years, we have increased our allocation to Europe for the simple reason that credit spreads and returns are currently attractive. Having a portion in Europe, and a growing portion in Asia Pacific, is helping us as these markets will develop over the years. They won’t get to the same size as the US, but private debt in Europe and Asia will get a growing share of this portfolio,” he predicts.

Another important seam to strategy involves avoiding mega deals where “everyone” is bidding. It’s not that these deals aren’t interesting, says Garant, it’s just that they are competitive and tightly priced. Instead, he is focused on transactions that are less crowded to get a better spread, calling on BCI’s strong partners to bring deal flow in the upper middle market and middle market.

Another reason to avoid mega deals in private debt includes competition in the space from broadly syndicated loans (BSLs), which corporate borrowers can tap into as an alternative to private debt. BSLs are usually cheaper, and lenders don’t ask for as much spread as private credit investors. In return, they don’t have the same flexibility.

“A private debt loan is more flexible, but it is more expensive,” he says.

Adjacent opportunities

Another successful seam to strategy includes adjacent opportunities. In one example, the team has broadened its remit and ventured into more asset-backed lending. Garant says it’s less competitive and offers a better risk return, and although deals are more complex, BCI can draw on its deep internal expertise and talent pool for support – around 85 per cent of BCI’s total assets are managed internally.

Traditionally, asset-backed lending where loans are secured against property or equipment, consumer loans or credit card balances, used to be the domain of banks. Unlike direct lending which involves analysis of the corporation, financial projections and strategy, investors in the asset-backed space must also ensure they have the capacity and infrastructure to successfully select the assets that sit behind each deal.

“This is where the secret lies,” he says, adding that managers (and their selection) play a key role in sourcing the assets that back the loans. “Asset-backed lending is usually part of a broad diversified portfolio and that requires technology, including AI tools, to better enable us to see the portfolio behind it because this is where the risk sits.”

Adjacent opportunities also include looking for openings in investment-grade (private) debt where investment-grade corporates go to the private market in search of a more flexible portion of funding.

It’s a strategy that also plays into another inherent strength of the portfolio.

The public markets team oversees both the allocation to private debt and absolute return strategies, alongside more obvious public allocations to passive and active public equities, government and corporate bonds, derivatives, trading and FX and managing portfolio leverage. Garant believes the hybrid portfolio works particularly well given today’s demands on investors to remain flexible, and the fact that the lines that used to define markets are increasingly blurred.

“Investment grade private debt is a hybrid between corporate bonds which are investment grade, and private debt per se, so having the view of both markets is essential in my view to do a good job in terms of capital allocation and risk return.”

Absolute return and synthetic index replication

The C$12 billion ($8.7 billion) absolute return portfolio, the other slight anomaly in BCI’s public markets allocation, seeks opportunities that are uncorrelated to equity – namely unique, idiosyncratic investments that are expected to perform well in all market environments.

The strategy provides a welcome corner of active risk in an equity allocation that has steadily moved into passive.

At 23.6 per cent, BCI’s current allocation to public equities is a smaller proportion of assets under management than it used to be and subjects the portfolio to less volatility than in the past. Of that, the majority is passive in index strategies for rebalancing.

Absolute return investment opportunities have a specific risk-return profile that typically comprises low downside risk and a capped upside, but which is above the market beta return. Absolute return implementation comes via an overlay above public, indexed equities whereby BCI’s clients receive the beta of equities, and a value add over the benchmark from uncorrelated strategies.

“Of course, the quid pro quo is if the downside is capped and limited, the upside is also going to be capped. The key success factor is the right partnership and sourcing, as well as the skill of the team and being agile and nimble to look at opportunities that are a bit different,” he says.

The largest exposure is to a long-short market-neutral credit manager. Other uncorrelated instruments providing strong returns in the overlay strategy include transactions in litigation finance and structured debt instruments with penny warrants. Here, the downside credit protection caps potential losses and the upside comes via the interest rate paid on the debt instrument and potential equity returns from the penny warrants.

In keeping with BCI’s overarching approach, the structure of the overlay is managed internally with capital allocated to partners where BCI will co-invest if the team decide they want more exposure to particular opportunities. “The positions are not short-term, we target transaction maturities to be within five years – we don’t aim for short-term tactical positions that are, say, three months.”

It’s a topical point. As more investors explore tactical asset allocation in the current climate, Garant remains lukewarm.

“I’m not a strong believer in tactical asset allocation. Our strategy is not based off short-term market moves.”

“Tactical asset allocation requires coping with significant mark-to-market volatility with features such as stop losses, and although some firms are good at it, many aren’t because it’s extremely difficult to time market movements. If you want to perform, you need to change positions quickly, and positions need to be large to have a meaningful impact on your return. For example, relative value trades between equity and bonds consume a lot of active risk.”

BCI has no edge investing tactically, he continues. It’s much better to invest the way they are, whereby partners bring opportunities, the internal team hunts for specific returns and risk profiles, and where transactions are less crowded.

A second active equity strategy in addition to absolute return comes via synthetic indexation, where the team move investment between physical and synthetic index replication according to market opportunities.

The physical allocation involves trading a basket of stocks alongside a synthetic index replication exposure via swaps, he explains. Every year, the team has added value by doing synthetic index replication and he concludes that the strategy is important because active equities are difficult in the current market.

“In public equity markets, we have never seen this type of market concentration before. In Canada, we are used to having a few stocks dominating the benchmark, but in the US, this is a new feature in the modern era. It adds complexity for long-only public equity active investors.”

Excellent interview with Daniel Garant, EVP and Global Head of Public Markets at BCI where he goes over their approach to private debt, absolute returns and other strategies.

He also explains why he's not a big believer in tactical asset allocation and how synthetic indexing adds value to the fund.  

How did BCI grow its private debt portfolio to an C$20 billion ($14.5 billion) allocation in seven years? 

They seeded the right funds like Hayfin Capital in Europe which they sold back in February, got an equity stake, negotiated lower fees and co-investment rights and they're continuing on this track. 

BCI recently announced that BCI-backed Brinley Partners secured an additional US$4 billion commitment from a leading US insurance company. 

BCI also recently announced the signing of a strategic minority investment agreement to support Three Hills, a private markets investment firm specialised in providing bespoke capital solutions to entrepreneurs and management teams in Europe and North America to help long-term corporate development and growth objectives

The structure of these deals gives BCI important leverage to negotiate lower fees and co-investment opportunities.

What else did BCI do to grow its private debt portfolio? Early on, it invested in CPP Investments' Antares Capital, a leader in US middle market lending.

But the key point in all of this is they structure their deals intelligently to negotiate better terms (lower fees, more co-investments) and they also get huge upside from their equity stakes in these firms.

Daniel Garant states this:

 “Not everyone can do direct or co-investments but having an overall portfolio of 65 per cent in direct and co-investments is a high number, and we are looking to do more”

That's a huge percentage in direct and co-investment and to do more, they need to structure the right deals with strategic partners.

What else? Similar to what IMCO's Jennifer Hartviksen told ION Analytics (see my recent post here), their credit team is flexible across the capital structure and even does hybrids between corporate bonds and private debt.

The ability to do more directs and co-investments and be flexible across different credit products requires a strong credit team that can gauge opportunities as they arise and solid technical knowledge to provide bespoke investment solutions to capitalize on hybrid opportunities.

Lastly, the time frame for co-investments is three to five years because it increases the probability that they will not get caught in a short-term storm, it's just a smarter risk-adjusted framework than short term tactical asset allocation which is fraught with risks.

Equally important, they avoid mega deals where spreads are tight and look to capitalize in less crowded strategies where spreads are wider (that carries more risk but better returns and if the team knows how to analyze these deals properly, it's a smarter strategy than chasing mega deals where returns are lacklustre).

Alright, let me wrap it up there.

Below, a panel discussion form last year's Milken Institute Global Conference featuring Daniel Garant, EVP and Global Head of Public Markets at BCI. The panel discusses trends in private markets including private debt and you can fast forward to around minute 9 to hear Daniel's insights (there's more, entire panel is worth watching).

Kennedy Ryan’s “Before I Let Go” is a poignant exploration of love, loss, and resilience, weaving a dual timeline narrative that delves into the complexities of human relationships and personal growth.

Overview of the Book

Before I Let Go, written by Kennedy Ryan, is a heartfelt and emotionally charged novel that explores the complexities of love, loss, and resilience. The story follows Yasmen and Josiah Wade, a couple navigating the challenges of their marriage after two devastating tragedies. Through a dual timeline narrative, the book weaves together their journey from the early days of their romance to the struggles of their present. The novel delves into themes of grief, memory, and the power of human connection, offering readers a deeply emotional and thought-provoking experience. Available in formats like PDF, the book has resonated with many for its raw honesty and nuanced character development.

Author Background — Kennedy Ryan

Kennedy Ryan is a bestselling author known for her emotionally charged and thought-provoking novels, including “Before I Let Go” and the Skyland series, exploring human connections and resilience.

Biography and Literary Career

Kennedy Ryan is a bestselling author celebrated for her emotionally resonant and thought-provoking novels. Known for works like “Before I Let Go” and the Skyland series, she skillfully blends romance with deeper themes of grief, resilience, and human connections. Ryan’s writing career has been marked by her ability to craft compelling narratives that explore the complexities of love and loss, earning her a dedicated readership and critical acclaim. Her novels often delve into the emotional depth of her characters, making her a significant voice in contemporary literature. With a focus on character development and nuanced storytelling, Kennedy Ryan continues to captivate readers with her unique perspective and emotional authenticity.

Writing Style and Influences

Kennedy Ryan’s writing style is renowned for its emotional depth and lyrical prose, blending elements of romance, drama, and contemporary fiction. Her narratives often explore complex human emotions, leveraging dual timelines to weave past and present into a cohesive whole. Ryan’s work is influenced by her keen observation of human relationships and societal dynamics, which she portrays with raw authenticity. Her ability to craft relatable characters and evoke powerful emotional responses has endeared her to readers. Drawing from personal experiences and broader cultural themes, Ryan’s writing is both intimate and expansive, creating stories that resonate deeply with audiences while maintaining a unique literary voice.

Impact on Contemporary Literature

Kennedy Ryan’s “Before I Let Go” has left an indelible mark on contemporary literature, offering a fresh perspective on themes of love, loss, and resilience. The novel’s emotional depth and nuanced character development have resonated with readers, challenging traditional narratives in romance and drama genres. Ryan’s ability to explore complex human emotions with authenticity has set a new standard for storytelling, inspiring both readers and fellow writers. The book’s dual timeline structure and relatable themes have contributed to its widespread acclaim, solidifying Ryan’s place as a significant voice in modern literature. Its impact is evident in the way it prompts readers to reflect on their own experiences, fostering deeper connections with the text.

Themes and Messages

Love, loss, and resilience are central themes, as the novel explores grief’s transformative power and memory’s role in healing and understanding the past.

Exploration of Love and Loss

Kennedy Ryan’s “Before I Let Go” masterfully explores the intricate dance between love and loss, tracing Yasmen and Josiah Wade’s journey from youthful romance to devastating tragedy. The novel delves into how love, while profoundly binding, can also become a source of pain when life’s challenges test its limits. Through a dual timeline narrative, the story reveals the couple’s transformation from hopeful newlyweds to individuals grappling with heartbreak and betrayal. Ryan’s poignant portrayal highlights how loss reshapes love, forcing characters to confront their vulnerabilities and reevaluate what they once believed about partnership and commitment. This exploration resonates deeply, offering readers a raw yet hopeful look at the resilience of the human heart.

Navigating Grief and Resilience

Kennedy Ryan’s “Before I Let Go” delves deeply into the complexities of grief and the human capacity for resilience. Yasmen and Josiah Wade’s story, set against the backdrop of dual timelines, explores how they navigate the aftermath of devastating tragedies. The novel portrays grief as a transformative force, reshaping their marriage and individual identities. Through their struggles, Ryan highlights the importance of acknowledging pain and seeking support. The characters’ journeys illustrate the fragile balance between heartbreak and healing, offering a powerful exploration of how resilience can emerge even in the darkest moments. This poignant narrative underscores the idea that grief, while shattering, can also catalyze growth and renewal.

The Role of Memory in Understanding the Past

In “Before I Let Go,” Kennedy Ryan intricately examines how memory shapes perceptions of the past. The novel’s dual timeline narrative highlights the selective nature of memory, revealing how characters recall and interpret past events. Yasmen and Josiah Wade’s recollections often diverge, showing how memory can distort or clarify truths. Ryan illustrates how these memories influence their present, affecting decisions and relationships. The interplay between remembered experiences and current realities underscores the dynamic role of memory in understanding personal and shared histories. This exploration challenges readers to reflect on how their own memories shape their identities and interactions, adding depth to the narrative.

Main Characters

Yasmen and Josiah Wade are the central figures, their complex marriage explored through dual timelines. Their emotional journeys highlight personal growth and the novel’s themes of love and loss.

Character Development in Yasmen and Josiah Wade

Yasmen and Josiah Wade are masterfully crafted characters whose emotional journeys form the heart of “Before I Let Go.” Their relationship, marked by love and loss, evolves through a dual timeline that reveals their growth and struggles. Yasmen’s resilience and Josiah’s introspection highlight their complex personalities, making them relatable and deeply human. The novel explores their individual flaws and strengths, as well as their shared efforts to navigate grief and rebuild their connection. Through their arcs, Kennedy Ryan illustrates the transformative power of love and the enduring impact of shared experiences. Their development underscores the novel’s themes of resilience, forgiveness, and the complexities of human relationships;

Significance of Supporting Characters

The supporting characters in “Before I Let Go” play pivotal roles in shaping the narrative and deepening the emotional landscape. Each character, such as Vashti, adds layers to the story, offering perspectives that enrich Yasmen and Josiah’s journeys. They serve as catalysts for growth, providing support, challenge, and insight into the protagonists’ lives. These characters are skillfully woven into the plot, ensuring their presence feels organic and impactful. Their interactions highlight themes of grief, resilience, and redemption, while also revealing the complexity of human connections. Kennedy Ryan’s portrayal of secondary characters underscores the novel’s exploration of community, forgiveness, and the interconnectedness of lives.

Character Arcs and Growth

Yasmen and Josiah Wade undergo profound transformations in “Before I Let Go,” as they navigate love, loss, and the complexities of their relationship. Their journeys are marked by resilience and self-discovery, with each character evolving in response to life’s challenges. Yasmen’s growth is particularly evident as she learns to confront grief and redefine her sense of purpose; Josiah, too, faces his own struggles, emerging stronger and more introspective. The dual timeline narrative allows readers to witness their development over time, highlighting their capacity for change and the enduring power of love. These character arcs are central to the novel’s emotional depth, offering readers a compelling exploration of personal growth and redemption.

Book Structure and Format

“Before I Let Go” features a dual timeline narrative, blending past and present through strategic flashbacks. The prologue sets the emotional tone, while chapters alternately explore memories and current struggles, creating a seamless flow that enhances the story’s depth and complexity.

Dual Timeline Narrative

Kennedy Ryan masterfully employs a dual timeline narrative in “Before I Let Go,” seamlessly intertwining past and present to reveal the complexities of Yasmen and Josiah Wade’s relationship. The story begins with a poignant prologue that sets the emotional tone, followed by chapters that alternate between memories of their early love and the challenges of their current struggles. This structure allows readers to witness the couple’s journey from romantic beginnings to the trials that test their bond. The dual timelines not only provide depth but also highlight the evolution of the characters, offering insights into how their past experiences shape their present. This narrative approach enhances the emotional impact, making the story both engaging and thought-provoking.

Prologue and Chapter Distribution

“Before I Let Go” by Kennedy Ryan opens with a heartfelt prologue that sets the emotional tone for the story, offering a glimpse into the deep connection between Yasmen and Josiah Wade. The prologue serves as a foundation, hinting at the challenges the couple will face. The chapters are carefully distributed to balance backstory with present-day struggles, creating a cohesive flow. Each chapter alternates between their early love story and the trials that test their relationship, providing readers with a comprehensive understanding of their journey. This structure ensures that the narrative unfolds seamlessly, keeping readers engaged and emotionally invested in the characters’ lives.

Use of Flashbacks and Present-Day Struggles

Kennedy Ryan masterfully interweaves flashbacks with present-day struggles in “Before I Let Go,” creating a narrative that deeply explores the characters’ emotional journeys. The flashbacks provide insight into the early love story of Yasmen and Josiah Wade, highlighting their connection before tragedy struck. These glimpses of the past contrast sharply with their current challenges, revealing how their relationship has evolved and been tested. The use of flashbacks not only adds depth to the story but also helps readers understand the motivations and emotional states of the characters. By alternating between past and present, Ryan keeps the narrative engaging and emotionally resonant, allowing readers to connect with the couple’s struggles on a profound level.

Emotional Depth and Conflict

Kennedy Ryan’s Before I Let Go masterfully explores emotional depth and conflict through a dual timeline, contrasting past love with present heartbreak, revealing raw emotion and resilience.

Portrayal of Marital Struggles

Kennedy Ryan vividly captures the complexities of marital struggles in Before I Let Go, tracing Yasmen and Josiah Wade’s journey from passionate union to heart-wrenching disintegration. The novel explores how two devastating tragedies unravel their relationship, revealing the cracks in their once-unbreakable bond. Through a dual timeline, Ryan juxtaposes their romantic beginnings with the stark reality of their present struggles, offering a raw and unfiltered look at marital conflict. The narrative delves into themes of communication breakdown, emotional distance, and the weight of unresolved grief, providing a poignant yet realistic portrayal of how love can both unite and divide. Ryan’s nuanced storytelling brings depth to the exploration of marital challenges, making it relatable and deeply human.

Handling of Traumatic Events

Before I Let Go masterfully portrays the profound impact of traumatic events on individuals and relationships. Kennedy Ryan delves into the emotional aftermath of two devastating tragedies that reshape Yasmen and Josiah Wade’s lives. The novel explores how these events disrupt their marriage, forcing them to confront pain, guilt, and vulnerability. Ryan’s sensitive portrayal captures the complexity of grief, illustrating how trauma can both unite and isolate. The narrative seamlessly weaves past and present, offering a deeply human perspective on resilience and healing. Through vivid storytelling, Ryan highlights the struggle to rebuild trust and connection, creating a poignant exploration of how traumatic events shape lives and relationships.

Emotional Strategies for Readers

Kennedy Ryan’s “Before I Let Go” equips readers with emotional strategies to navigate the novel’s intense themes of grief, love, and resilience. The book encourages readers to confront their emotions head-on, offering a safe space to process loss and heartache. Ryan’s vivid storytelling helps readers identify and name their emotions, fostering self-reflection and empathy. The dual timeline narrative allows readers to witness character growth and resilience, providing hope and practical insights for coping with trauma. By sharing Yasmen and Josiah’s journey, the novel empowers readers to embrace vulnerability and seek healing. This emotional journey is both cathartic and transformative, leaving readers with tools to navigate their own struggles with greater strength and understanding.

Critical Reception and Reviews

“Before I Let Go” has received acclaim for its emotional depth and raw storytelling, resonating deeply with readers and critics alike. Many praise Kennedy Ryan’s ability to craft relatable characters and tackle poignant themes, while some note the narrative’s pacing challenges. The book’s exploration of grief and resilience has struck a chord, solidifying its place as a compelling read in contemporary literature.

Reader Feedback and Reviews

Readers have praised “Before I Let Go” for its emotional depth and relatable portrayal of marital struggles and grief. Many appreciated the dual timeline narrative, finding it engaging and thought-provoking. The character development, particularly of Yasmen and Josiah Wade, resonated with readers, who admired their growth and resilience. Some reviewers noted that the book tackled heavy themes with sensitivity, making it a impactful read. However, a few readers mentioned that the pacing slowed midway, affecting their immersion. Overall, the novel has been well-received for its raw storytelling and ability to evoke strong emotions, leaving a lasting impression on many who’ve read it.

Critical Analysis of the Novel

“Before I Let Go” by Kennedy Ryan has received critical acclaim for its nuanced portrayal of love, loss, and resilience. Critics highlight the novel’s ability to balance emotional depth with a compelling narrative structure, particularly praising the dual timeline that seamlessly connects past and present. The exploration of grief and marital struggles is described as raw and authentic, offering readers a realistic glimpse into the complexities of human relationships; Reviewers commend Ryan’s writing style for its emotional intensity and sensitivity, noting how the characters’ arcs are both believable and impactful. While some critics mention the pacing slows slightly in the middle, the novel is widely praised for its thought-provoking themes and its ability to evoke profound emotional responses, solidifying its place in contemporary literature.

Comparison with Other Works by Kennedy Ryan

Kennedy Ryan’s “Before I Let Go” stands out among her works for its deeply emotional and introspective tone. While her Skyland series, including “This Could Be Us” and “Can’t Get Enough,” focuses on the power of female friendships and resilience, this novel delves deeper into marital struggles and grief. The dual timeline narrative, a hallmark of her writing style, is used more effectively here, offering a richer exploration of character development. Fans of her previous works will recognize her signature blend of angst and hope, but the emotional depth in “Before I Let Go” surpasses expectations, making it a standout in her bibliography. Ryan’s ability to evolve while maintaining her unique voice is evident, captivating both new and loyal readers.

Accessing the Book — PDF and Other Formats

“Before I Let Go” by Kennedy Ryan is available in PDF, text, and other digital formats for easy access. Readers can download the PDF version or purchase physical copies online.

Availability of Digital Formats

“Before I Let Go” by Kennedy Ryan is widely available in digital formats, including PDF and text files, ensuring easy access for readers worldwide. The book can be downloaded from various online platforms, such as Amazon Kindle, Google Books, and other eBook retailers. Additionally, the PDF version can be accessed through direct downloads from select websites, making it convenient for readers to enjoy the story on their preferred devices. The digital formats are optimized for readability across smartphones, tablets, and e-readers, providing a seamless experience. This accessibility has contributed to the book’s popularity, allowing fans of Kennedy Ryan’s work to engage with her storytelling effortlessly. The digital versions are also frequently updated to ensure compatibility with the latest reading technologies.

Downloading the PDF Version

The PDF version of “Before I Let Go” can be easily downloaded from various online platforms. Readers can access the book through popular eBook retailers like Amazon Kindle or Google Books, where it is available for purchase or download. Additionally, free PDF versions can be found on select websites, though verifying the source’s reliability is recommended. Once purchased or downloaded, the PDF can be stored on devices like smartphones, tablets, or e-readers for convenient reading. The process typically involves creating an account, completing the purchase, and downloading the file directly to your device. This format ensures that fans of Kennedy Ryan can enjoy her storytelling with ease and flexibility, anytime and anywhere.

Options for Purchasing Physical Copies

“Before I Let Go” by Kennedy Ryan is widely available in physical formats, including hardcover and paperback. Readers can purchase copies from major book retailers like Amazon, Barnes & Noble, and IndieBound. Additionally, local bookstores often carry Kennedy Ryan’s works, supporting both authors and small businesses. For international readers, platforms like Book Depository offer worldwide shipping with competitive pricing. Signed editions and special releases may also be found through the author’s official website or during book signings. Purchasing a physical copy ensures a tangible connection to the story, making it a cherished addition to any reader’s collection. This option is ideal for those who prefer the tactile experience of reading.

Discussion Guide and Reading Groups

“Before I Let Go” offers a rich foundation for book clubs, with themes of love, loss, and resilience sparking meaningful conversations. Explore the emotional depth, character arcs, and the novel’s poignant portrayal of relationships to foster engaging discussions.

Questions for Book Clubs

Discuss the dual timeline narrative: How does it enhance the story’s emotional impact? How do Yasmen and Josiah’s past experiences shape their present struggles? What role do supporting characters play in their journey? Explore the theme of grief: How do the characters navigate loss, and what coping mechanisms do they employ? How does the author portray the complexities of marital relationships? What message do you think the book conveys about love and resilience? How does the use of flashbacks contribute to understanding the characters’ motivations? What personal reflections did the book inspire for you? How do the themes resonate with your own life experiences?

Facilitating Meaningful Discussions

Encourage participants to share their interpretations of the dual timeline and how it deepens the story’s emotional layers. Ask how the characters’ past experiences influence their present decisions and relationships. Discuss the role of supporting characters in shaping Yasmen and Josiah’s journeys. Explore how the author’s portrayal of grief and resilience resonates with readers’ own experiences. Consider the ethical dilemmas and choices faced by the characters, prompting reflection on moral decision-making. Invite members to share personal insights or connections to the themes of love, loss, and redemption. Foster an open dialogue about the book’s message on the transformative power of relationships and personal growth.

Engaging with the Book’s Themes

“Before I Let Go” by Kennedy Ryan invites readers to immerse themselves in profound themes of love, loss, and memory, each intricately woven throughout the narrative. The dual timeline structure encourages reflection on how past experiences shape present realities, while the exploration of grief highlights resilience as a transformative force. Yasmen and Josiah’s journey challenges readers to confront their own understanding of love and its limitations. The novel’s emphasis on memory as both a burden and a bridge to healing prompts introspection about personal experiences with loss. By engaging with these themes, readers gain insight into the complexities of human relationships and the enduring power of love, fostering a deeper connection with the story and its characters.

Impact on Readers

“Before I Let Go” profoundly resonates with readers, evoking deep emotional connections and introspection about love, loss, and resilience, leaving a lasting and memorable impression on its audience.

Reader Responses and Testimonials

Readers have overwhelmingly praised “Before I Let Go” for its emotional depth and relatability, with many describing it as a heart-wrenching yet hopeful exploration of love and loss. Fans of Kennedy Ryan highlight the authenticity of the characters and the raw honesty in their struggles, noting how the story resonates deeply on a personal level. Many readers have shared testimonials about how the book helped them process their own grief or reevaluate their relationships. The dual timeline narrative has been particularly praised for its ability to weave past and present seamlessly, creating a captivating and immersive reading experience. The novel’s ability to evoke strong emotions while offering a message of resilience has left a lasting impact on its audience.

Personal Reflections and Insights

Readers of “Before I Let Go” often reflect on how the novel resonates with their own experiences of love, loss, and personal growth. Many have shared that the book prompted them to confront unresolved emotions and reevaluate relationships in their lives. The dual timeline narrative has inspired readers to think deeply about the interplay between past and present, offering a fresh perspective on their own journeys. The raw honesty of the characters’ struggles has fostered a sense of connection, with readers appreciating the authenticity and vulnerability portrayed. The novel’s exploration of grief and resilience has also sparked meaningful introspection, encouraging readers to embrace their own stories of heartache and healing. This emotional resonance has made the book a transformative read for many.

“Before I Let Go” by Kennedy Ryan is a deeply emotional and thought-provoking novel that lingers long after the final page, leaving readers with profound reflections on love, loss, and resilience.

“Before I Let Go” by Kennedy Ryan is a heart-wrenching exploration of love, loss, and resilience, told through a dual timeline that intertwines past and present struggles. The novel follows Yasmen and Josiah Wade as they navigate the fractures in their marriage after devastating tragedies, revealing the complexities of grief and the power of memory. Ryan’s vivid storytelling and emotional depth create a compelling narrative that lingers long after the final page. The book emphasizes the importance of confronting emotional pain and finding strength in vulnerability, offering readers a profound reflection on human relationships and personal growth. Its thought-provoking themes and relatable characters make it a memorable read.

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The Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization overturned the federal constitutional right to abortion. Since the Dobbs decision in 2022, 12 states have banned abortion and a dozen more have added significant restrictions on reproductive health care and abortion access. In contrast, several states—including Colorado, Montana, Ohio, and Vermont—have voted to amend their state constitutions to enshrine abortion protections. As shown in Figure A, the Dobbs decision has made abortion access vary widely by state.

Figure A

When looking at these state policies, it’s worth noting that many of the states with abortion protections are also states with higher levels of unionization. Our recent report documents the strong correlation between high union density and a range of economic, personal, and democratic well-being metrics. In the same way unions give workers a voice at their workplace, unions also give workers a voice in shaping their communities. In the report, we show that residents in states with higher union density are more likely to have health insurance, access to paid sick and family leave, and live in a state with Medicaid expansion. This correlation holds true when evaluating state abortion policies. Figure B shows that states with abortion protections have an average union density twice as high as that of states with varying degrees of abortion restrictions and bans.

Figure B

Many abortion-restricted states have also enacted anti-union and so-called “right-to-work” (RTW) laws. These laws are designed to suppress worker power by prohibiting unions and employers from negotiating union security clauses into collective bargaining agreements, making it difficult for workers to join, form, and sustain unions. As a result, states with RTW laws—many in the South and Midwest—have low levels of union density. Research shows that RTW laws are associated with higher income inequality, lower wages and benefits, and increased workplace fatalities.

Unfortunately, federal attacks on reproductive freedom have continued since the Dobbs decision. This summer, President Trump signed into law the One Big Beautiful Bill Act (OBBBA), which makes draconian spending cuts—mostly to health care and food assistance for children and families—in order to give massive tax cuts to the wealthiest households. The OBBBA also poses significant obstacles to reproductive freedom by prohibiting health care clinics that provide abortion services from receiving federal Medicaid payments for one year for any other services they provide. This provision specifically targets Planned Parenthood, putting 1 in 3 centers at risk of closure and taking away vital reproductive services—such as cancer screenings, prenatal care, and contraception—from more than 1 million people. Planned Parenthood is currently pursuing a legal challenge to this OBBBA provision—but Trump’s undermining of reproductive freedom and health care does not stop there. 

Since returning to office, Trump has withheld millions in Title X funds for family planning services, scrubbed government websites of vital information about reproductive health care, and nominated individuals with anti-abortion views to key positions at the Department of Health and Human Services. Earlier this month, the Trump administration issued a proposed rule that would exclude abortion services for veterans as part of reproductive health care covered under the Department of Veterans Affairs. The proposed rule seeks to rescind a 2022 Biden-era rule that expanded reproductive health care and abortion access in the wake of the Supreme Court’s Dobbs decision.

As attacks on reproductive freedom and health care continue at the federal level, unions can play a critical role in safeguarding reproductive freedom in the states. However, union density levels are not as high as they could or should be. While nearly half of all nonunion workers say they want a union in their workplace, only 11.1% of all workers were covered by a union contract in 2024. This is because current labor law does not provide workers with a meaningful right to a union and collective bargaining.

Federal policymakers should pass the Protecting the Right to Organize Act and the Public Service Freedom to Negotiate Act to strengthen private- and public-sector workers’ right to organize and access a union. Further, states with RTW laws should restore private-sector workers’ full bargaining rights by repealing these anti-union state laws. Building union density is not just a worker or workplace issue, but also a fundamental component to strengthening reproductive freedom in our communities.

Amalya Dubrovsky, Karen Friar and Laura Bratton of Yahoo Finance report Dow jumps 800 points to record, S&P 500, Nasdaq soar as Powell's Jackson Hole finale fuels bets on September rate cut:

US stocks soared on Friday as Federal Reserve Chair Jerome Powell opened the door to a September rate cut during his highly anticipated speech at Jackson Hole.

The Dow Jones Industrial Average rose 800 points or 1.9% to close at a fresh record, while the S&P 500 moved up about 1.5%, and the tech-heavy Nasdaq Composite climbed 1.9%. Friday's surge came on the heels of a downbeat week for markets, as tech stocks took a hit amid AI trade doubts.

His remarks shook up rate-cut bets, which had been waning after a weak monthly jobs report. Traders on Friday were pricing in about 91.5% odds of a September cut compared to 70% earlier in the morning and 85% a week ago.

Meanwhile, the 10-year and 30-year Treasury yields fell after Powell's remarks. The commentary also spurred a gain in bitcoin and other cryptocurrencies, with ethereum leading the crypto gains.

The White House watched Powell's speech closely, as President Trump has continued to push the Fed and Powell to lower rates. Trump opened a new front in his public pressure campaign on central bank independence by calling for the resignation of Fed governor Lisa Cook for alleged mortgage fraud. On Friday, Trump said he'll "fire" Cook if she doesn't resign, though legally, presidents cannot easily dismiss Fed governors.

On the earnings front, Zoom (ZM) stock popped Friday after reporting an AI boost, and Ross Stores (ROST) jumped as shoppers sought discounts amid tariffs. Intuit (INTU) and Workday (WDAY), meanwhile, slid.

Shares of Intel (INTC) jumped 5% after President Trump said the government will take a 10% stake in the ailing chip giant, calling it a "great deal." 

Pia Sigh and Sarah Min of CNBC also report Dow surges more than 800 points to post record close as Powell speech fuels rally:

The Dow Jones Industrial Average rallied to an all-time high Friday after Federal Reserve Chair Jerome Powell signaled the central bank could begin easing monetary policy next month.

The Dow climbed 846.24 points, or 1.89%, reaching a fresh high and closing at a record level of 45,631.74. The S&P 500 rose 1.52% to end at 6,466.91. At its session high, the broad market index came within three points of its record. The Nasdaq Composite gained 1.88% and settled at 21,496.53.

Shares of megacap technology stocks soared on Powell’s comments. Nvidia added 1.7%, while Meta Platforms jumped more than 2%. Alphabet and Amazon each climbed more than 3%. Tesla shares jumped about 6%.

In a tepid speech at the central bank’s annual conclave in Jackson Hole, Wyo., Powell said that “the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.” The Fed chief added that “the balance of risks appear to be shifting” between the central bank’s dual mandate of full employment and stable prices. He cited “sweeping changes” in tax, trade and immigration policies.

Expectations for a quarter-point rate cut in September surged to roughly 83% following the speed from about 75% earlier in the week, according to the CME Group’s FedWatch tool.

“The bar is extremely high now for the Fed to leave rates unchanged in less than a month,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management.

Friday’s performance came in contrast to much more downbeat market action this week. The major averages entered the session lower week to date due to pressure in megacap tech. The latest rally helped investors claw back most of the losses from earlier in the week.

For the week, 30-stock Dow advanced 1.5%, and the S&P 500 gained 0.3%, while the Nasdaq slipped 0.6%.

Jeff Cox of CNBC also reports Powell indicates conditions ‘may warrant’ interest rate cuts as Fed proceeds ‘carefully’:

Federal Reserve Chair Jerome Powell on Friday gave a tepid indication of possible interest rate cuts ahead as he noted a high level of uncertainty that is making the job difficult for monetary policymakers.

In his much-anticipated speech at the Fed’s annual conclave in Jackson Hole, Wyoming, the central bank leader in prepared remarks cited “sweeping changes” in tax, trade and immigration policies. The result is that “the balance of risks appear to be shifting” between the Fed’s twin goals of full employment and stable prices.

While he noted that the labor market remains in good shape and the economy has shown “resilience,” he said downside dangers are rising. At the same time, he said tariffs are causing risks that inflation could rise again — a stagflation scenario that the Fed needs to avoid.

With the Fed’s benchmark interest rate a full percentage point below where it was when Powell delivered his keynote a year ago, and the unemployment rate still low, conditions allow “us to proceed carefully as we consider changes to our policy stance,” Powell said.

“Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,” he added.

That was as close as he came during the speech to endorsing a rate cut that Wall Street widely believes is coming when the Federal Open Market Committee next meets Sept. 16-17.

However, the remarks were enough to send stocks soaring and Treasury yields tumbling. The Dow Jones Industrial Average showed a gain of more than 600 points following the public release of Powell’s speech while the policy-sensitive 2-year Treasury note saw a 0.08 percentage point fall to around 3.71%.

In addition to market expectations, President Donald Trump has demanded aggressive cuts from the Fed in scathing public attacks he has lobbed at Powell and his colleagues.

The Fed has held its benchmark borrowing rate in a range between 4.25%-4.5% since December. Policymakers have continued to cite the uncertain impact that tariffs will have on inflation as a reason for caution and believe that current economic conditions and the slightly restrictive policy stance allow for time to make further decisions.

Importance of Fed independence

While not addressing the White House demands for lower rates specifically, Powell did note the importance of Fed independence.

“FOMC members will make these decisions, based solely on their assessment of the data and its implications for the economic outlook and the balance of risks. We will never deviate from that approach,” he said.

The speech comes amid ongoing negotiations between the White House and its global trading partners, a situation often in flux and without clarity on where it will end. Recent indicators show consumer prices gradually pushing higher but wholesale costs up more rapidly.

From the Trump administration’s view, the tariffs will not cause lasting inflation, thus warranting rate cuts. Powell’s position in the speech was that a range of outcomes is possible, with a “reasonable base case” being that the tariff impacts will be “short lived — a one-time shift in the price level” that likely would not be cause for holding rates higher. However, he said nothing is certain at this point.

“It will continue to take time for tariff increases to work their way through supply chains and distribution networks,” Powell said. “Moreover, tariff rates continue to evolve, potentially prolonging the adjustment process.”

In addition to summarizing the current conditions and potential outcomes, the speech touched on the Fed’s five-year review of its policy framework. The review resulted in several notable changes from when the central bank last performed the task in 2020.

At that time, in the midst of the Covid pandemic, the Fed switched to a “flexible average inflation targeting” regime that effectively would allow inflation to run higher than the central bank’s 2% goal coming after a prolonged period of holding below that level. The upshot is that policymakers could be patient with slightly higher inflation if it meant insuring a more comprehensive labor market recovery.

However, shortly after adopting the strategy, inflation began to climb, ultimately hitting 40-year highs, while policymakers largely dismissed the rise as “transitory” and not needing rate hikes. Powell noted the damaging impacts from the inflation and the lessons learned.

“As it turned out, the idea of an intentional, moderate inflation overshoot had proved irrelevant. There was nothing intentional or moderate about the inflation that arrived a few months after we announced our 2020 changes to the consensus statement, as I acknowledged publicly in 2021,” Powell said. “The past five years have been a painful reminder of the hardship that high inflation imposes, especially on those least able to meet the higher costs of necessities.”

Also during the review, the Fed reaffirmed its commitment to its 2% inflation target. There have been critics on both sides of the issue, with some suggesting the rate is too high and can lead to a weaker dollar, while others seeing a need for the central bank to be flexible.

“We believe that our commitment to this target is a key factor helping keep longer-term inflation expectations well anchored,” Powell said.

Alright, the week ended with a bang but it wasn't such a great week prior to today.

Powell confirmed the Fed will in all likelihood cut rates in September.

I said so last week when I covered top funds' activity in Q2, I expect a "one and done" rate cut in September.

The thing Fed officials are grappling with now is the lagged effects of tariffs on inflation. 

Specifically, there were major inventory buildups as tariffs were announced but as those inventories wear off, producers will have to pass on the tariffs to consumers or eat them and suffer margin compression (ie. less profits).

But the US economy is definitely slowing, Powell is right to highlight the Fed's dual mandate and employment conditions certainly warrant a rate cut next month (fed funds rate is restrictive).

Alright, let me move straight to the stock market action this week in US markets.

As shown below, Energy, Real Estate, Financials and Materials were the top performing sectors this week (data from barchart):

And here are the top performing US large and mid cap stocks this week (data from barchart):

 

And here are the worst performing US large and mid cap stocks this week (data from barchart):

 

A lot of the high flyers like Palantir got clobbered this week.

Among the mid cap, shares of Viking Therapeutics (VKTX) were down more than 40% Tuesday after their phase 2 trial showed a high dropout rate relative to placebo control group.

I'm not going to bore you with the details but the data also showed extremely impressive weight loss results in just 12 weeks where larger competitors take much longer to show same results.

The trial design was too aggressive, the dropout rate was  28% vs 20% for placebo group (which is high) and it was in the highest dose subgroup.

In my opinion, this is THE biotech dip of the year to buy and there's no question in my mind that Pfizer is going to snap this company up (or some other big pharma). 

I would invite you to read this post on X from Hataf Capital:

Viking Therapeutics Just Got a Reality Check

I’ve followed Viking Therapeutics $VKTX long enough to know one thing: when Wall Street builds up a biotech story, reality almost always comes crashing down harder than expected. That’s exactly what happened this week when Viking… pic.twitter.com/ZQeAokx99Y

— Hataf Capital (@hataf_capital) August 19, 2025

I also suggest you look at the top institutional holders of Viking shares here.

As I explained last week, I've been trading biotech long enough to know how Wall Street works, they manipulate these shares.

In my humble opinion, the dip in Viking Therapeutics shares this week was not warranted, the data was a lot better than what investors interpreted and this presents a great buying opportunity at these levels: 

[Full disclosure: Viking is my biggest biotech position by far and I will ride it out no matter what.]

Alright, let me wrap it up there.

Below,Ryan Detrick, Carson Group chief market strategist, joins 'The Exchange' to discuss the market rally, Fed Chair Powell's speech and the bond market.

Also, Tom Lee, Fundstrat head of research and chief investment officer of Fundstrat Capital, joins CNBC's 'Squawk on the Street' to discuss his reaction to Fed Chair Powell's speech at Jackson Hole, market expectations, and much more.

Third, Jeremy Siegel, WisdomTree chief economist and Wharton professor emeritus, joins 'Closing Bell' to discuss the emphatic nature of the market response to Powell's Jackson Hole comments, the argument the Fed should cut rates and much more.

Fourth, Aswath Damodaran, NYU professor of finance, joins 'Power Lunch' to discuss if valuations of gotten out of control, if the markets overreacting to the latest Fed news and much more.

Fifth, Warren Pies, 3Fourteen Research co-founder, joins 'Closing Bell' to discuss the market's reaction to the Powell's Jackson Hole comments, if there's downside risk to the macroeconomy and much more.

Lastly, The CNBC Investment committee debate the "Post-Powell Playbook" following Fed Chair Jerome Powell's speech in Jackson Hole.

Amalya Dubrovsky, Karen Friar and Laura Bratton of Yahoo Finance report Dow jumps 800 points to record, S&P 500, Nasdaq soar as Powell's Jackson Hole finale fuels bets on September rate cut:

US stocks soared on Friday as Federal Reserve Chair Jerome Powell opened the door to a September rate cut during his highly anticipated speech at Jackson Hole.

The Dow Jones Industrial Average rose 800 points or 1.9% to close at a fresh record, while the S&P 500 moved up about 1.5%, and the tech-heavy Nasdaq Composite climbed 1.9%. Friday's surge came on the heels of a downbeat week for markets, as tech stocks took a hit amid AI trade doubts.

His remarks shook up rate-cut bets, which had been waning after a weak monthly jobs report. Traders on Friday were pricing in about 91.5% odds of a September cut compared to 70% earlier in the morning and 85% a week ago.

Meanwhile, the 10-year and 30-year Treasury yields fell after Powell's remarks. The commentary also spurred a gain in bitcoin and other cryptocurrencies, with ethereum leading the crypto gains.

The White House watched Powell's speech closely, as President Trump has continued to push the Fed and Powell to lower rates. Trump opened a new front in his public pressure campaign on central bank independence by calling for the resignation of Fed governor Lisa Cook for alleged mortgage fraud. On Friday, Trump said he'll "fire" Cook if she doesn't resign, though legally, presidents cannot easily dismiss Fed governors.

On the earnings front, Zoom (ZM) stock popped Friday after reporting an AI boost, and Ross Stores (ROST) jumped as shoppers sought discounts amid tariffs. Intuit (INTU) and Workday (WDAY), meanwhile, slid.

Shares of Intel (INTC) jumped 5% after President Trump said the government will take a 10% stake in the ailing chip giant, calling it a "great deal." 

Pia Sigh and Sarah Min of CNBC also report Dow surges more than 800 points to post record close as Powell speech fuels rally:

The Dow Jones Industrial Average rallied to an all-time high Friday after Federal Reserve Chair Jerome Powell signaled the central bank could begin easing monetary policy next month.

The Dow climbed 846.24 points, or 1.89%, reaching a fresh high and closing at a record level of 45,631.74. The S&P 500 rose 1.52% to end at 6,466.91. At its session high, the broad market index came within three points of its record. The Nasdaq Composite gained 1.88% and settled at 21,496.53.

Shares of megacap technology stocks soared on Powell’s comments. Nvidia added 1.7%, while Meta Platforms jumped more than 2%. Alphabet and Amazon each climbed more than 3%. Tesla shares jumped about 6%.

In a tepid speech at the central bank’s annual conclave in Jackson Hole, Wyo., Powell said that “the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.” The Fed chief added that “the balance of risks appear to be shifting” between the central bank’s dual mandate of full employment and stable prices. He cited “sweeping changes” in tax, trade and immigration policies.

Expectations for a quarter-point rate cut in September surged to roughly 83% following the speed from about 75% earlier in the week, according to the CME Group’s FedWatch tool.

“The bar is extremely high now for the Fed to leave rates unchanged in less than a month,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management.

Friday’s performance came in contrast to much more downbeat market action this week. The major averages entered the session lower week to date due to pressure in megacap tech. The latest rally helped investors claw back most of the losses from earlier in the week.

For the week, 30-stock Dow advanced 1.5%, and the S&P 500 gained 0.3%, while the Nasdaq slipped 0.6%.

Jeff Cox of CNBC also reports Powell indicates conditions ‘may warrant’ interest rate cuts as Fed proceeds ‘carefully’:

Federal Reserve Chair Jerome Powell on Friday gave a tepid indication of possible interest rate cuts ahead as he noted a high level of uncertainty that is making the job difficult for monetary policymakers.

In his much-anticipated speech at the Fed’s annual conclave in Jackson Hole, Wyoming, the central bank leader in prepared remarks cited “sweeping changes” in tax, trade and immigration policies. The result is that “the balance of risks appear to be shifting” between the Fed’s twin goals of full employment and stable prices.

While he noted that the labor market remains in good shape and the economy has shown “resilience,” he said downside dangers are rising. At the same time, he said tariffs are causing risks that inflation could rise again — a stagflation scenario that the Fed needs to avoid.

With the Fed’s benchmark interest rate a full percentage point below where it was when Powell delivered his keynote a year ago, and the unemployment rate still low, conditions allow “us to proceed carefully as we consider changes to our policy stance,” Powell said.

“Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,” he added.

That was as close as he came during the speech to endorsing a rate cut that Wall Street widely believes is coming when the Federal Open Market Committee next meets Sept. 16-17.

However, the remarks were enough to send stocks soaring and Treasury yields tumbling. The Dow Jones Industrial Average showed a gain of more than 600 points following the public release of Powell’s speech while the policy-sensitive 2-year Treasury note saw a 0.08 percentage point fall to around 3.71%.

In addition to market expectations, President Donald Trump has demanded aggressive cuts from the Fed in scathing public attacks he has lobbed at Powell and his colleagues.

The Fed has held its benchmark borrowing rate in a range between 4.25%-4.5% since December. Policymakers have continued to cite the uncertain impact that tariffs will have on inflation as a reason for caution and believe that current economic conditions and the slightly restrictive policy stance allow for time to make further decisions.

Importance of Fed independence

While not addressing the White House demands for lower rates specifically, Powell did note the importance of Fed independence.

“FOMC members will make these decisions, based solely on their assessment of the data and its implications for the economic outlook and the balance of risks. We will never deviate from that approach,” he said.

The speech comes amid ongoing negotiations between the White House and its global trading partners, a situation often in flux and without clarity on where it will end. Recent indicators show consumer prices gradually pushing higher but wholesale costs up more rapidly.

From the Trump administration’s view, the tariffs will not cause lasting inflation, thus warranting rate cuts. Powell’s position in the speech was that a range of outcomes is possible, with a “reasonable base case” being that the tariff impacts will be “short lived — a one-time shift in the price level” that likely would not be cause for holding rates higher. However, he said nothing is certain at this point.

“It will continue to take time for tariff increases to work their way through supply chains and distribution networks,” Powell said. “Moreover, tariff rates continue to evolve, potentially prolonging the adjustment process.”

In addition to summarizing the current conditions and potential outcomes, the speech touched on the Fed’s five-year review of its policy framework. The review resulted in several notable changes from when the central bank last performed the task in 2020.

At that time, in the midst of the Covid pandemic, the Fed switched to a “flexible average inflation targeting” regime that effectively would allow inflation to run higher than the central bank’s 2% goal coming after a prolonged period of holding below that level. The upshot is that policymakers could be patient with slightly higher inflation if it meant insuring a more comprehensive labor market recovery.

However, shortly after adopting the strategy, inflation began to climb, ultimately hitting 40-year highs, while policymakers largely dismissed the rise as “transitory” and not needing rate hikes. Powell noted the damaging impacts from the inflation and the lessons learned.

“As it turned out, the idea of an intentional, moderate inflation overshoot had proved irrelevant. There was nothing intentional or moderate about the inflation that arrived a few months after we announced our 2020 changes to the consensus statement, as I acknowledged publicly in 2021,” Powell said. “The past five years have been a painful reminder of the hardship that high inflation imposes, especially on those least able to meet the higher costs of necessities.”

Also during the review, the Fed reaffirmed its commitment to its 2% inflation target. There have been critics on both sides of the issue, with some suggesting the rate is too high and can lead to a weaker dollar, while others seeing a need for the central bank to be flexible.

“We believe that our commitment to this target is a key factor helping keep longer-term inflation expectations well anchored,” Powell said.

Alright, the week ended with a bang but it wasn't such a great week prior to today.

Powell confirmed the Fed will in all likelihood cut rates in September.

I said so last week when I covered top funds' activity in Q2, I expect a "one and done" rate cut in September.

The thing Fed officials are grappling with now is the lagged effects of tariffs on inflation. 

Specifically, there were major inventory buildups as tariffs were announced but as those inventories wear off, producers will have to pass on the tariffs to consumers or eat them and suffer margin compression (ie. less profits).

But the US economy is definitely slowing, Powell is right to highlight the Fed's dual mandate and employment conditions certainly warrant a rate cut next month (fed funds rate is restrictive).

Alright, let me move straight to the stock market action this week in US markets.

As shown below, Energy, Real Estate, Financials and Materials were the top performing sectors this week (data from barchart):

And here are the top performing US large and mid cap stocks this week (data from barchart):

 

And here are the worst performing US large and mid cap stocks this week (data from barchart):

 

A lot of the high flyers like Palantir got clobbered this week.

Among the mid cap, shares of Viking Therapeutics (VKTX) were down more than 40% Tuesday after their phase 2 trial showed a high dropout rate relative to placebo control group.

I'm not going to bore you with the details but the data also showed extremely impressive weight loss results in just 12 weeks where larger competitors take much longer to show same results.

The trial design was too aggressive, the dropout rate was  28% vs 20% for placebo group (which is high) and it was in the highest dose subgroup.

In my opinion, this is THE biotech dip of the year to buy and there's no question in my mind that Pfizer is going to snap this company up (or some other big pharma). 

I would invite you to read this post on X from Hataf Capital:

Viking Therapeutics Just Got a Reality Check

I’ve followed Viking Therapeutics $VKTX long enough to know one thing: when Wall Street builds up a biotech story, reality almost always comes crashing down harder than expected. That’s exactly what happened this week when Viking… pic.twitter.com/ZQeAokx99Y

— Hataf Capital (@hataf_capital) August 19, 2025

I also suggest you look at the top institutional holders of Viking shares here.

As I explained last week, I've been trading biotech long enough to know how Wall Street works, they manipulate these shares.

In my humble opinion, the dip in Viking Therapeutics shares this week was not warranted, the data was a lot better than what investors interpreted and this presents a great buying opportunity at these levels: 

[Full disclosure: Viking is my biggest biotech position by far and I will ride it out no matter what.]

Alright, let me wrap it up there.

Below,Ryan Detrick, Carson Group chief market strategist, joins 'The Exchange' to discuss the market rally, Fed Chair Powell's speech and the bond market.

Also, Tom Lee, Fundstrat head of research and chief investment officer of Fundstrat Capital, joins CNBC's 'Squawk on the Street' to discuss his reaction to Fed Chair Powell's speech at Jackson Hole, market expectations, and much more.

Third, Jeremy Siegel, WisdomTree chief economist and Wharton professor emeritus, joins 'Closing Bell' to discuss the emphatic nature of the market response to Powell's Jackson Hole comments, the argument the Fed should cut rates and much more.

Fourth, Aswath Damodaran, NYU professor of finance, joins 'Power Lunch' to discuss if valuations of gotten out of control, if the markets overreacting to the latest Fed news and much more.

Fifth, Warren Pies, 3Fourteen Research co-founder, joins 'Closing Bell' to discuss the market's reaction to the Powell's Jackson Hole comments, if there's downside risk to the macroeconomy and much more.

Lastly, The CNBC Investment committee debate the "Post-Powell Playbook" following Fed Chair Jerome Powell's speech in Jackson Hole.

Barbara Shecter of the National Post reports OMERS squeezes out 2.2% return in 'challenging' first half:

The Ontario Municipal Employees’ Retirement System generated a 2.2 per cent investment return in the first half of 2025 while facing down a “challenging environment for investors” amid global economic uncertainty and exposure to the United States.

The pension manager’s $3.1-billion gain for the period of Jan. 1 to June 30 pushed its net assets to $140.7 billion. 

More than half of the fund’s assets, 55 per cent, are in the U.S., where the Donald Trump administration has destabilized global trade with a series of punitive tariffs.

“OMERS had a positive start in what was a particularly challenging environment for investors,” chief executive Blake Hutcheson said. “As we manage through the current short-term challenges, in both public and private investing businesses, this team continues to unlock opportunities that deliver both immediate and long-term value.”

OMERS’ first-half results were hurt by a more than five per cent decline by the U.S. dollar despite some hedging. The pain was partially offset by the strengthening of the British pound and the euro, but currency had a negative impact of 1.2 per cent on its first-half results.

“Active decisions to hedge currencies added almost one per cent to returns, protecting portfolio value,” Jonathan Simmons, the fund’s chief financial and strategy officer, said. 

Over the five years that OMERS has reported mid-year investment results, the average annual net return has been 8.7 per cent. Over 10 years, the pension fund has posted an annual net return of 6.9 per cent for a total gain of $70.2 billion.

Infrastructure and public equities drove returns in the first six months of 2025, though six of the portfolio’s seven asset classes, including credit and bonds, contributed positively. Private investments were the weak spot, with private equity posting a negative return of 1.3 per cent. 

“Private investment valuations and transaction activity, particularly in private equities and real estate, continue to be held back by uncertainty in the global marketplace,” Simmons said.

The real estate portfolio, which represents 15 per cent of the portfolio, posted a return of 1.1 per cent in the first six months of the year. OMERS, along with other Canadian pension funds, owns office buildings hammered by the shift to remote and hybrid work during and in the aftermath of the COVID-19 pandemic.

But OMERS said conditions were improving after a series of challenging years for the industry. 

“Despite market uncertainty, results were supported by strong operating fundamentals, particularly in office and hotels,” it said in a release on Thursday.

The pension fund for municipal workers in Ontario was also a landlord for insolvent retailer Hudson Bay Co.

OMERS’ real estate division, Oxford Properties, went to court this month to argue against transferring some of those leases to an “unvetted and unproven” entrepreneur who is attempting to buy some former locations of the storied Canadian retailer. The court filing said the lease transfer could “jeopardize the stability, reputation, and performance of these assets” in which Oxford has invested hundreds of millions of dollars.

“A diminution in the value or stability of Oxford’s real estate portfolio would negatively impact the performance of OMERS’ investments, and, by extension, adversely affect the long-term interests of millions of current and future pension plan beneficiaries,” the Aug. 9 filing said. 

James Bradshaw of the Globe and Mail also reports that governments and institutional investors show alignment on big project financing, OMERS CEO says:

Co-operation among large investors, industry leaders and governments is rapidly increasing as parties discuss how to get major projects off the ground to protect Canada against the threat from tariffs, the CEO of the OMERS pension fund says.

Demand for new infrastructure, energy and defence investment is surging, and so is investors’ willingness to explore big-ticket investments in projects of national importance, Blake Hutcheson, chief executive officer of Ontario Municipal Employees Retirement System, said in an interview.

OMERS earned a 2.2-per-cent return in the first half of 2025, adding $3.1-billion to its assets in spite of a tough start to the year for markets, according to a mid-year update released Thursday. With high volatility in public markets and sluggish dealmaking for public assets, Canadian pension funds are eyeing a growing opportunity to make new investments at home.

“The conversations are at a level that I haven’t seen for at least a decade, where we are exploring some private and public opportunities in earnest,” Mr. Hutcheson said. “This is an all-hands-on-deck moment, in my view, where the governments, the financiers and the pension plans can and should do some meaningful things in Canada.”

Mr. Hutcheson was careful to add a caveat that OMERS has a fiduciary duty to pursue the best returns with the least risk for members, and doesn’t intend to accept weaker investment results. But he said the “dialogue and a willingness to do things” are at a high mark.

“Is it crystal clear, are we ready to jump? The short answer is no,” he said. “Are we optimistic that we can do things in this space? The answer is yes. … And for the sake of the country, we’re hopeful.”

Through the first half of the year, infrastructure investments delivered the strongest gains for OMERS, increasing by 3.6 per cent, while private credit and publicly traded stocks produced solid returns.

The falling value of the U.S. dollar between January and June hampered OMERS’s investment performance, reducing total gains by 1.2 percentage points. But OMERS had hedging positions that it increased late last year, which helped offset some of those currency losses, reducing the potential drag on its overall results by one percentage point.

With widespread uncertainty over tariffs, wars, markets and currencies, “we think it’s a solid start to the year,” Mr. Hutcheson said. “As investors, you really just want to be certain that you know where the goalposts are, and they’ve been moving around a lot lately, so it hasn’t been an easy first half.”

Over 10 years, OMERS has earned an average annual return of 6.9 per cent, adding more than $70-billion to its portfolio. Over the past five years, the average gain has been 8.7 per cent.

OMERS invests on behalf of about 640,000 Ontario public-service workers, including nurses, firefighters and police officers.

Its assets increased to $140.7-billion as of June 30, up from $138.2-billion at the end of 2024.

The OMERS real estate portfolio bounced back with a 1.1-per-cent gain in the first half of 2025, after suffering a loss last year. The performance of office properties has started to rebound from pandemic lows as employers push staff to work from home less frequently.

“We never lost our commitment to high-quality office,” Mr. Hutcheson said. “Even in the worst days during COVID, my view was: Never count that asset class out.”

The lone asset class that produced a half-year loss for OMERS was private equity, down 1.3 per cent. 

Earlier today, OMERS issued a press release stating it earned $3.1 billion in the first six months of 2025:

TORONTO, Aug. 21, 2025 (GLOBE NEWSWIRE) -- OMERS generated a net investment return of 2.2%, a gain of $3.1 billion, for the period of January 1 to June 30, 2025. This result brings the cumulative 10-year net investment income figure to $70.2 billion. Net assets at June 30, 2025 totalled $140.7 billion.

“OMERS had a positive start in what was a particularly challenging environment for investors,” said Blake Hutcheson, OMERS President and CEO. “As we manage through the current short-term challenges, in both public and private investing businesses this team continues to unlock opportunities that deliver both immediate and long-term value. Over the five years that we have reported our mid-year investment update, our talented global team and investment strategies have delivered an average annual net return of 8.7%.”

“Six of our seven asset classes delivered positive results in the first half of 2025. Infrastructure and public equities drove returns, supported by credit and bonds,” said Jonathan Simmons, OMERS Chief Financial and Strategy Officer. “Currency had an overall negative 1.2% impact on our results, driven by a significant decline in the U.S. dollar, and partially offset by strengthening of the British pound sterling and euro. Active decisions to hedge currencies added almost 1% to returns, protecting portfolio value. Private investment valuations and transaction activity, particularly in private equities and real estate, continue to be held back by uncertainty in the global marketplace.”

“While we expect continued market instability for the remainder of 2025, we believe our diversification in quality assets positions us well to see through this cycle, with ample liquidity to pursue opportunities that meet our objective of paying pensions for generations to come,” said Mr. Hutcheson. “We proudly serve 640,000 Ontarians and we work every day to build lasting value that will serve them throughout their retirement.”

About OMERS
OMERS is a jointly sponsored, defined benefit pension plan, with more than 1,000 participating employers ranging from large cities to local agencies, and 640,000 active, deferred and retired members. Our members include union and non-union employees of municipalities, school boards, local boards, transit systems, electrical utilities, emergency services and children’s aid societies across Ontario. OMERS teams work in Toronto, London, New York, Amsterdam, Luxembourg, Singapore, Sydney and other major cities across North America and Europe – serving members and employers, and originating and managing a diversified portfolio of high-quality investments in government bonds, public and private credit, public and private equities, infrastructure and real estate.

Media Contact
Don Peat
Director, Media Relations
1 416.417.7385
dpeat@omers.com

Net Assets
$ Billions

Net Return History
to June 30, 2025

6-month
(January 1, 2025 – June 30, 2025)

2.2%, a gain of $3.1 billion   10-year
(July 1, 2015 – June 30, 2025)

6.9%, a gain of $70.2 billion   

Diversified by Asset Class and Geography
OMERS invests in high-quality assets that are well-diversified by geography and asset type.

Asset Diversification
As at June 30, 2025

Geographic Diversification
As at June 30, 2025

Asset Class Investment Performance

Net Returns   Six months ended 
June 30, 2025 Government Bonds 2.1 %Public Credit 1.6 %Private Credit 2.7 %Public Equities 2.4 %Private Equities (1.3 %)Infrastructure 3.6 %Real Estate   1.1 %Total Plan 2.2 %   

Investment Performance Highlights
Over the six months ended June 30, 2025:

• The more than 5% decline in the U.S. dollar in the first half of the year meaningfully detracted from our returns across asset classes, particularly in public and private equity. Our active decisions to hedge our currency exposure added almost 1% to the portfolio, including an approximate 30-basis point lift from our increase to U.S. dollar hedges at the end of 2024. This currency management strategy, combined with our diversification in the British pound sterling and euro, mitigated the otherwise negative impact on the portfolio.
• Our strategic focus to deploy into fixed income assets continued to positively contribute to our returns. Government bonds, public and private credit each delivered positive performance primarily due to interest income and a decline in bond yields.
• Public equities delivered positive performance from core large-cap holdings in financials, communications services and information technology sectors.
• Private equities were held back as investor confidence remains challenged and markets continue to exhibit very low levels of activity. As a result, valuations continue to be impacted by slow earnings growth and headwinds within certain industry sectors.
• Infrastructure continues to deliver steady results, with most assets performing in line with expectations.
• Real estate delivered a positive return after a series of challenging years for the industry. Despite market uncertainty, results were supported by strong operating fundamentals, particularly in office and hotels.

Liquidity
We continue to maintain ample liquidity, with $17.4 billion in liquid assets to pay pension benefits, fund investment opportunities, satisfy potential collateral demands related to our use of derivatives, and to fund expenses.

Long-Term Issuer Credit Ratings

This Investment Update presents certain non-GAAP measures. These measures are calculated on the same basis as those calculated and presented in our 2024 Annual Report. This Investment Update and the Condensed Interim Consolidated Financial Statements (the “Interim Financial Statements”) are unaudited. OMERS Administration Corporation’s financial performance set out in this Investment Update is only for the period ended June 30, 2025, unless otherwise indicated. Past performance may not indicate future performance because a broad range of uncertainties (including without limitation those related to interest rates and inflation) could have an impact on the performance of various asset classes. The financial information included in this Investment Update should be read in conjunction with the Interim Financial Statements.

Portfolio update
We continue to invest in assets that build strong futures for communities and members alike.
Below is a selection of activities undertaken since January 1, 2025.

• We acquired full ownership of a high-quality office portfolio in Western Canada that includes seven office properties in Calgary’s and Vancouver's central business districts, totalling 4 million square feet. This portfolio is 95% occupied.
• We broke ground on 70 Hudson Yards, the first 1 million plus square foot, ground-up office development in New York City in over five years.
• We sold a 9.995% stake in Transgrid, the largest electricity transmission network in Australia, to Australian sovereign wealth fund, Future Fund. As part of this transaction, OMERS will manage that interest on their behalf in addition to our own 9.995% stake. 
• We announced a transformative co-investment of over $200 million to retrofit the existing office buildings at Canada Square in midtown Toronto. The redevelopment will deliver 680,000 square feet of highly functional and modernized office space.
• Our shopping mall investments were recognized as national and regional market leaders in sales performance by the International Council of Shopping Centers. Yorkdale continues to dominate as Canada’s top-performing shopping centre for the second year running with ~$2,300 in sales per square foot. Square One Shopping Centre and Scarborough Town Centre also increased their sales per square foot.
• We officially opened the doors to the $1.3 billion Parkline Place, celebrating the opening of this new commercial office and retail destination in Sydney, Australia co-owned by Oxford Properties, and which includes the first new office tower in Sydney’s Midtown in almost a decade. 
• We announced a joint partnership with AustralianSuper that aims to build a significant industrial and logistics venture across Europe. As part of this joint venture, we announced the acquisition of Broadheath Network Centre in Greater Manchester.
• OMERS Finance Trust (OFT) successfully closed two significant note offerings, a EUR 1 billion, 10-year note and a USD 1 billion, 5-year note. This marks OFT’s third EUR and ninth USD offering.

Subsequent to the end of June:

• We broke ground on the first major purpose-built housing project in Scarborough in over a generation on the west side of Oxford’s Scarborough Town Centre shopping mall. The development will consist of three residential towers of 1300 units with the aim of delivering critically needed housing in a historically undersupplied area for people at a variety of different price points, including a 21% allocation for affordable housing. 

Alright, this afternoon I had a chance to discuss OMERS' mid-year results with CEO Blake Hutcheson and CFO & CSO Jonathan Simmons.

I want to begin by thanking them both for taking the time to talk to me and also thank Don Peat for setting up the Teams meeting and sending me the relevant documents.

As always, these are mid-year results, in line with what OTPP and CDPQ posted but OMERS has a different asset mix, more tilted to private markets (see asset mix above).

I also want to correct something from last week when I covered CPP Investments' quarterly results,  OMERS and La Caisse do provide asset class performance for mid-year, OTPP does not.

Alright, Blake began by giving me the overview:

The results are self-explanatory. My main message is it's a very volatile world with respect to geopolitics, with respect to tariff conversations, with respect to currency fluctuations, with respect to elections including in this country.

In the context of all that, we feel our results are a solid start to the year, so we go forward from here with strength but it has been a very difficult investment environment.

You know as well as anybody, one thing you want as an investor is a high degree of certainty, where are the goalposts. This has been a period where there's anything but certainty as the mood of the day can swing depending on one utterance or another. 

The good thing is we have a long view and a diversified portfolio and we really try to separate the headlines form the underlying economic fundamentals and facts. That's our best defence, focus on things we can control: high quality assets, lots of diversification, put our energy into our greatness as opposed to the noise of the day. That's going to continue to be our mantra.

You know me, I started in 2020 so I like to keep track of the 5-year return and the 5-year return since my first month or two has been 8.7% which is a compelling story.

It's been an active semester, diversification is helping.

What you might want to see is the currency hurt us so far this year, it's helped us other years, so you can't have blessings every year. It's cost us 1.2% but we are really proud of our hedging strategy because they protected an additional 100 basis points or thereabouts because it could have been a lot worse if they weren't active. And we took all our hedges off for a number of years after 2020, we were thoughtful and redeployed. It was an overt strategy, it largely paid off.

When we look at our plan, our expectations for the year, our credit book, our equities book, our infrastructure are maybe a little bit behind in some cases but on track to meet our budgets. 

Our other privates are slower. Real estate, the good news is we are in the black now, that's starting to turn the corner. Our mutual friend Dan Fournier has made a major difference in the culture and consideration we've put in that business. 

And our difficult one like many others is our private equity portfolio. We have a new head of private equity, we just finalized the strategy yesterday with our Board as to where that business will go in the future, maybe in the fall we'll take some time to share it with you. We got our arms around where we are strong, where we are weak, where we have to deploy more, where we have to deploy less. That one is a work in progress and we don't see selling or buying, we don't see a lot of activity that gives us data points -- negative or positive -- in the private equity space because again, with all the uncertainty out there, people aren't sellers at prices where we can buy. That business has been our weakest link this half.

I guess the other thing is we remain committed to Canada. The flash numbers say we are down in Canada to 16%, our assets are at about 21% which is where we started the year and it's roughly 55% in the US. The 16% takes into account primarily cash accounts because we used to carry more Canadian cash and we deployed a lot, particularly in real estate the first half. 

But our 21% is constant and we are going to continue to invest heavily in the United States, pretty commensurate with our current book, but we want to do more in this country. We feel this is an all hands on deck moment in Canada, we are seeing really positive and hopeful signs come out of the federal government at this point, more so than we've seen in a decade where government decision makers both federally and provincially in most of the Canadian markets we invest across Canada, there's a harmony that didn't exist, there is a sense of mutual purpose that didn't exist, and I think Canadians are coming together. 

We are hopeful we can do more, particularly in infrastructure and real estate in Canada to be part of the solution in this all hands on deck moment for our country.  

I don't know exactly what that means in terms of allocations -- you know the business well -- we can't give somebody a home court discount, we are a fiduciary, we have to make sure it hits our risk-adjusted expectations and return. It's not that we can -- however big our heart is -- gift anybody when we are responsible for 640,000 people but it does mean we are underwriting more than we have in the past, we are having bigger and more important conversations with various levels of governments than what we had in the last decade.

We want to do more in Canada, we hope to do more in Canada and we want to be part of the go forward success and future of this country.

That's a great overview which covers all the main points.

On infrastructure which had another solid half, Blake added this:

We have 30 assets, it's a broad portfolio, it's a highly concession run asset class for us. With big businesses like Bruce Power, it's been a consistent high single digit asset class for us year in and year out and this year is no exception. It's really the broad shoulders and the consistency of that wide portfolio that continues to get us in the 7-8-9% range and it has less volatility than our other asset classes. You don't see the exit multiples change a lot for those businesses, they stay pretty constant. So it's a steady Eddy business for us, no surprises.

Indeed, the yield is always around 8% or more a year for OMERS and others.

In private equity, I noted that some critics of OMERS purely direct strategy have privately told me that asset class needed to be revamped there but I also note that all pension funds are experiencing a tough slug in PE, not just OMERS, even those that do more fund investments.

Blake responded:

Of our privates, the real estate business not withstanding recent years because it's been difficult, and our infrastructure business  have been really steady long-term producers for us with great teams. And our private equity business has done well for us too and I don't want to diminish the contribution it's made for us in any way.

In the last few years, we have had to rethink our strategy because it's hard to compete with the best players in the world when we are relatively small.  

So, from a buyout perspective, we retreated from direct investing in Europe, we are very much focused on North America. As we cycle out of those assets in Europe, we will use that capital to redeploy into more fund type investments where bigger players with bigger teams can get into assets we couldn't get to.

I don't want to be critical. We have done a detailed assessment, we are at a point and time where we are changing our focus and strategy. We will consistently and deeply invest in Canada and the United States but less so in Europe and the available capital will go to funds.

With our new head of private equity (Alexander Fraser), he just presented the new strategy this week, there will be lots of nuanced changes to that portfolio to right size it and position it well for the future. That is underway, when we are ready, we will be happy to share with you those prospects.

But we have a really good team, we have a really good new leader and I'm actually energized to see their direction of travel. This was a difficult half not just for us but for most people in the marketplace and sometimes when you get those difficult moments, it gives you the motivation to make the changes you need to make and we are making them.   

I noted rates are higher for longer, dampening returns in private equity and real estate and the other thing that worries me is if there will be more inflation in the US, wage inflation can lead to more margin compression in private and publicly listed businesses.

I also noted there was a big Bloomberg article yesterday on how pension funds missed the big tech rally, but pension funds are not there to beat the S&P 500 every year, so while there may be some pressure in privates over the short run, over the long term, they offer more stability and yet people remain focused on the short term.

I asked Blake if they've been feeling this pressure to take risks where they shouldn't be taking risk to deliver higher returns and he responded:

Jonathan and I feel incredibly supported by our board. I can honestly say while short-term results are interesting and certainly people watch our annual results with vigour, we are a long term investor. I don't feel any compulsion to beef up the shorter term at the expense of the longer term.

We all have to be nimble right now. It's an ever changing world. We need to remain on our toes. We need to be assessing all of the inputs from an economic, political and fundamental perspective. You can never be complacent and continue to win in the markets but I don't feel any compulsion to think short term because of the short term pressures, never have, it's not the nature of our board, it's not the nature of the way we approach the business.

And great assets, great management teams, great fundamentals, not in every cycle but they tend to see through cycles, when you compromise asset quality, when you compromise people quality, when you compromise businesses to get some short term yield, it doesn't end so well. 

That's the discipline and that the discipline that has enabled us to deliver our 8.7% return in the last five years.

But the private equity component of our business, this isn't something we picked up this year and decided we needed to have a new direction, this has been a 2-3 year focus and it's going to require a few more years to get it to a place where we expect it to be as part of our asset allocation.

Since Blake is an expert in real estate (he was formerly the head of Oxford Properties prior to becoming CEO of OMERS), I asked him if he's seeing signs of a comeback in offices since more companies are demanding back to the office from their workers.

He responded:

I think you've heard me say this consistently even during Covid, people need to live somewhere, people need to work somewhere.

Even in Covid, when everyone was saying the office is going the way of the dodo bird, we were building office buildings at Oxford. 

The truth is high quality AA, AAA office buildings will continue to do extremely well and didn't even break during Covid.

Secondary and tertiary assets, many of them are in deep trouble because there is a migration to quality.  

Looking at office, our portfolio is best of class in every market we are in around the world. In Toronto, we are 95% leased, across Canada, we are practically 95% leased. We just invested by buying out CPP Investments in seven big office buildings in Canada which put sour conviction where our wallet is.

We just announced a new building we are building in Hudson Yards, 70 Hudson Yards in New York, a large consulting firm is taking 800,000 square feet of 1.4 million, and that will be the first new office building in five years in Manhattan. I'm totally confident it's going to do extremely well.

So in our 62-year history at Oxford but even in the last 10 or 12, when people say thou shouldn't touch and something is going in the wrong direction, we look at the history, high quality great assets, if they're not playing into the fundamentals, we will. 

And I like our odds. We finished a building in Vancouver called The Stack, it's ahead of plan from a lease perspective. 70 Hudson Yards will be great. We are just finishing a new building in Sidney, it's going to take a while but it's going to do great. 

So, a great office is a great office, we like the trends, we never felt that with high quality assets we were in jeopardy and when everybody else said don't build more, we built more. 

I asked Blake if Logistics and Multi-family continue to be the sectors driving the returns at Oxford and he replied: 

Logistics interesting enough, uncertainty around supply chains, we are not seeing big appetite, a lot of people are sitting on their hands because why take up more space until they see how this game of chess plays out.   

For a while the direction of travel for rates for an industrial building was only one way, it was higher growth than any other sector, that slowed relative to other sectors but we have a great portfolio that's functioning well.  

And multi-family, because it's typically a 97% leased business, you have the ability to finance several. You won't really see an improvement until the cost of funds comes down. Because you have a high level of debt, that has a significant impact on yield and values. It will be better in the next 2-3 years as the Fed rate comes down. Right now, it's an ok sector but until the cost of money comes down, it's not going to be what we hoped.

I shifted my attention to Private Credit and asked Jonathan Simmons what he sees there. 

Jonathan replied:

The private credit strategy, if I look back at the last few years, and we already talked about infrastructure and its contribution, private credit has to be the other one. Very strong returns from that asset class, we've been moving capital into it consistently. It's wheels on a treadmill with private credit because most of these are 5-year deals so the team is very busy with the underwriting. We are so pleased with the risk profile we've seen. A year ago, people asked me a lot of questions about credit quality, bu tit's holding up, the discipline is strong, the returns are very good for our pension plan so it's an asset class to like.

I ended by asking Jonathan and Blake what's keeping them up at night, what are they worried about the most in this uncertain environment.

Jonathan chimed in first: 

I crave for stability. It makes it much easier for decision makers to plan for the future, whether that be taking up more space in one of our buildings, or contracting one of our private equity businesses or getting a new project off the ground that we can invest in from an infrastructure perspective. When that stability comes back to the world, investors will have a much more enjoyable time. And it's been very choppy so that's what I look forward to the most.

Blake then added this:

I've always said, I don't need a competitive advantage, I need a level playing field and please don't break my jaw. And if I can invest in those environments, history has proven OMERS can do that, and my career suggests that's an environment I can excel in.

Because we share more with you than anyone, right now what keeps me up at night is our best friend, our biggest trading partner, our most important strategic alliance, the United States of America, we have deep friendships on both sides of the border. America needs Canada, Canada needs America and we are at a moment in history where that frayed relationship is as sad as it is destructive. 

I think it can be fixed, I think it's going to require deep personal investments by our leaders spending time with their leaders because bees stick to honey. 

It was very difficult to do that until the new government was elected, I think they have a really good shot at it and I think it's really important.  

I don't know if it can be normalized but once we get the terms of engagement finalized, including USMCA over the finish line -- which by the way 93% of the trade of this country is captured by USMCA -- once we get over the finish line, and we remind each other that it's critical for all three parties in that document, it's going to be a difficult time emotionally and financially and economically.

That's what I worry about, how we can fix that relationship or at least improve it, how we get USMCA behind us and how we can work as a unified trading block in in North America to fortify ourselves against whoever the foe may be and make all three nations better because we are better together.  

So those are the things I think about, I think it's an important time in history, and as I said we at OMERS want to be part of the solution by investing in this country if we can a little more and by helping build cross border relations for the best interest of our members and best interests of Canada.

OMERS is doing its part to help all levels of governments in Canada succeed.

Once again, I thank Blake and Jonathan for another great discussion, I really appreciate their time and insights. 

Below, watch Bake Hutcheson at the Canadian Club Toronto discussing his views on leading and investing during these challenging times (April 16, 2025).

Last but not least. I want to sincerely wish Jonathan's daughter Jessica who is fighting cancer for a second time a speedy and full recovery (read Jonathan's post here). 

We are all rooting for you Jessica, stay positive and if you need a little inspiration, watch Isabella Strahan's documentary, Life Interrupted, I highly recommend you do so. 

Barbara Shecter of the National Post reports OMERS squeezes out 2.2% return in 'challenging' first half:

The Ontario Municipal Employees’ Retirement System generated a 2.2 per cent investment return in the first half of 2025 while facing down a “challenging environment for investors” amid global economic uncertainty and exposure to the United States.

The pension manager’s $3.1-billion gain for the period of Jan. 1 to June 30 pushed its net assets to $140.7 billion. 

More than half of the fund’s assets, 55 per cent, are in the U.S., where the Donald Trump administration has destabilized global trade with a series of punitive tariffs.

“OMERS had a positive start in what was a particularly challenging environment for investors,” chief executive Blake Hutcheson said. “As we manage through the current short-term challenges, in both public and private investing businesses, this team continues to unlock opportunities that deliver both immediate and long-term value.”

OMERS’ first-half results were hurt by a more than five per cent decline by the U.S. dollar despite some hedging. The pain was partially offset by the strengthening of the British pound and the euro, but currency had a negative impact of 1.2 per cent on its first-half results.

“Active decisions to hedge currencies added almost one per cent to returns, protecting portfolio value,” Jonathan Simmons, the fund’s chief financial and strategy officer, said. 

Over the five years that OMERS has reported mid-year investment results, the average annual net return has been 8.7 per cent. Over 10 years, the pension fund has posted an annual net return of 6.9 per cent for a total gain of $70.2 billion.

Infrastructure and public equities drove returns in the first six months of 2025, though six of the portfolio’s seven asset classes, including credit and bonds, contributed positively. Private investments were the weak spot, with private equity posting a negative return of 1.3 per cent. 

“Private investment valuations and transaction activity, particularly in private equities and real estate, continue to be held back by uncertainty in the global marketplace,” Simmons said.

The real estate portfolio, which represents 15 per cent of the portfolio, posted a return of 1.1 per cent in the first six months of the year. OMERS, along with other Canadian pension funds, owns office buildings hammered by the shift to remote and hybrid work during and in the aftermath of the COVID-19 pandemic.

But OMERS said conditions were improving after a series of challenging years for the industry. 

“Despite market uncertainty, results were supported by strong operating fundamentals, particularly in office and hotels,” it said in a release on Thursday.

The pension fund for municipal workers in Ontario was also a landlord for insolvent retailer Hudson Bay Co.

OMERS’ real estate division, Oxford Properties, went to court this month to argue against transferring some of those leases to an “unvetted and unproven” entrepreneur who is attempting to buy some former locations of the storied Canadian retailer. The court filing said the lease transfer could “jeopardize the stability, reputation, and performance of these assets” in which Oxford has invested hundreds of millions of dollars.

“A diminution in the value or stability of Oxford’s real estate portfolio would negatively impact the performance of OMERS’ investments, and, by extension, adversely affect the long-term interests of millions of current and future pension plan beneficiaries,” the Aug. 9 filing said. 

James Bradshaw of the Globe and Mail also reports that governments and institutional investors show alignment on big project financing, OMERS CEO says:

Co-operation among large investors, industry leaders and governments is rapidly increasing as parties discuss how to get major projects off the ground to protect Canada against the threat from tariffs, the CEO of the OMERS pension fund says.

Demand for new infrastructure, energy and defence investment is surging, and so is investors’ willingness to explore big-ticket investments in projects of national importance, Blake Hutcheson, chief executive officer of Ontario Municipal Employees Retirement System, said in an interview.

OMERS earned a 2.2-per-cent return in the first half of 2025, adding $3.1-billion to its assets in spite of a tough start to the year for markets, according to a mid-year update released Thursday. With high volatility in public markets and sluggish dealmaking for public assets, Canadian pension funds are eyeing a growing opportunity to make new investments at home.

“The conversations are at a level that I haven’t seen for at least a decade, where we are exploring some private and public opportunities in earnest,” Mr. Hutcheson said. “This is an all-hands-on-deck moment, in my view, where the governments, the financiers and the pension plans can and should do some meaningful things in Canada.”

Mr. Hutcheson was careful to add a caveat that OMERS has a fiduciary duty to pursue the best returns with the least risk for members, and doesn’t intend to accept weaker investment results. But he said the “dialogue and a willingness to do things” are at a high mark.

“Is it crystal clear, are we ready to jump? The short answer is no,” he said. “Are we optimistic that we can do things in this space? The answer is yes. … And for the sake of the country, we’re hopeful.”

Through the first half of the year, infrastructure investments delivered the strongest gains for OMERS, increasing by 3.6 per cent, while private credit and publicly traded stocks produced solid returns.

The falling value of the U.S. dollar between January and June hampered OMERS’s investment performance, reducing total gains by 1.2 percentage points. But OMERS had hedging positions that it increased late last year, which helped offset some of those currency losses, reducing the potential drag on its overall results by one percentage point.

With widespread uncertainty over tariffs, wars, markets and currencies, “we think it’s a solid start to the year,” Mr. Hutcheson said. “As investors, you really just want to be certain that you know where the goalposts are, and they’ve been moving around a lot lately, so it hasn’t been an easy first half.”

Over 10 years, OMERS has earned an average annual return of 6.9 per cent, adding more than $70-billion to its portfolio. Over the past five years, the average gain has been 8.7 per cent.

OMERS invests on behalf of about 640,000 Ontario public-service workers, including nurses, firefighters and police officers.

Its assets increased to $140.7-billion as of June 30, up from $138.2-billion at the end of 2024.

The OMERS real estate portfolio bounced back with a 1.1-per-cent gain in the first half of 2025, after suffering a loss last year. The performance of office properties has started to rebound from pandemic lows as employers push staff to work from home less frequently.

“We never lost our commitment to high-quality office,” Mr. Hutcheson said. “Even in the worst days during COVID, my view was: Never count that asset class out.”

The lone asset class that produced a half-year loss for OMERS was private equity, down 1.3 per cent. 

Earlier today, OMERS issued a press release stating it earned $3.1 billion in the first six months of 2025:

TORONTO, Aug. 21, 2025 (GLOBE NEWSWIRE) -- OMERS generated a net investment return of 2.2%, a gain of $3.1 billion, for the period of January 1 to June 30, 2025. This result brings the cumulative 10-year net investment income figure to $70.2 billion. Net assets at June 30, 2025 totalled $140.7 billion.

“OMERS had a positive start in what was a particularly challenging environment for investors,” said Blake Hutcheson, OMERS President and CEO. “As we manage through the current short-term challenges, in both public and private investing businesses this team continues to unlock opportunities that deliver both immediate and long-term value. Over the five years that we have reported our mid-year investment update, our talented global team and investment strategies have delivered an average annual net return of 8.7%.”

“Six of our seven asset classes delivered positive results in the first half of 2025. Infrastructure and public equities drove returns, supported by credit and bonds,” said Jonathan Simmons, OMERS Chief Financial and Strategy Officer. “Currency had an overall negative 1.2% impact on our results, driven by a significant decline in the U.S. dollar, and partially offset by strengthening of the British pound sterling and euro. Active decisions to hedge currencies added almost 1% to returns, protecting portfolio value. Private investment valuations and transaction activity, particularly in private equities and real estate, continue to be held back by uncertainty in the global marketplace.”

“While we expect continued market instability for the remainder of 2025, we believe our diversification in quality assets positions us well to see through this cycle, with ample liquidity to pursue opportunities that meet our objective of paying pensions for generations to come,” said Mr. Hutcheson. “We proudly serve 640,000 Ontarians and we work every day to build lasting value that will serve them throughout their retirement.”

About OMERS
OMERS is a jointly sponsored, defined benefit pension plan, with more than 1,000 participating employers ranging from large cities to local agencies, and 640,000 active, deferred and retired members. Our members include union and non-union employees of municipalities, school boards, local boards, transit systems, electrical utilities, emergency services and children’s aid societies across Ontario. OMERS teams work in Toronto, London, New York, Amsterdam, Luxembourg, Singapore, Sydney and other major cities across North America and Europe – serving members and employers, and originating and managing a diversified portfolio of high-quality investments in government bonds, public and private credit, public and private equities, infrastructure and real estate.

Media Contact
Don Peat
Director, Media Relations
1 416.417.7385
dpeat@omers.com

Net Assets
$ Billions

Net Return History
to June 30, 2025

6-month
(January 1, 2025 – June 30, 2025)

2.2%, a gain of $3.1 billion   10-year
(July 1, 2015 – June 30, 2025)

6.9%, a gain of $70.2 billion   

Diversified by Asset Class and Geography
OMERS invests in high-quality assets that are well-diversified by geography and asset type.

Asset Diversification
As at June 30, 2025

Geographic Diversification
As at June 30, 2025

Asset Class Investment Performance

Net Returns   Six months ended 
June 30, 2025 Government Bonds 2.1 %Public Credit 1.6 %Private Credit 2.7 %Public Equities 2.4 %Private Equities (1.3 %)Infrastructure 3.6 %Real Estate   1.1 %Total Plan 2.2 %   

Investment Performance Highlights
Over the six months ended June 30, 2025:

• The more than 5% decline in the U.S. dollar in the first half of the year meaningfully detracted from our returns across asset classes, particularly in public and private equity. Our active decisions to hedge our currency exposure added almost 1% to the portfolio, including an approximate 30-basis point lift from our increase to U.S. dollar hedges at the end of 2024. This currency management strategy, combined with our diversification in the British pound sterling and euro, mitigated the otherwise negative impact on the portfolio.
• Our strategic focus to deploy into fixed income assets continued to positively contribute to our returns. Government bonds, public and private credit each delivered positive performance primarily due to interest income and a decline in bond yields.
• Public equities delivered positive performance from core large-cap holdings in financials, communications services and information technology sectors.
• Private equities were held back as investor confidence remains challenged and markets continue to exhibit very low levels of activity. As a result, valuations continue to be impacted by slow earnings growth and headwinds within certain industry sectors.
• Infrastructure continues to deliver steady results, with most assets performing in line with expectations.
• Real estate delivered a positive return after a series of challenging years for the industry. Despite market uncertainty, results were supported by strong operating fundamentals, particularly in office and hotels.

Liquidity
We continue to maintain ample liquidity, with $17.4 billion in liquid assets to pay pension benefits, fund investment opportunities, satisfy potential collateral demands related to our use of derivatives, and to fund expenses.

Long-Term Issuer Credit Ratings

This Investment Update presents certain non-GAAP measures. These measures are calculated on the same basis as those calculated and presented in our 2024 Annual Report. This Investment Update and the Condensed Interim Consolidated Financial Statements (the “Interim Financial Statements”) are unaudited. OMERS Administration Corporation’s financial performance set out in this Investment Update is only for the period ended June 30, 2025, unless otherwise indicated. Past performance may not indicate future performance because a broad range of uncertainties (including without limitation those related to interest rates and inflation) could have an impact on the performance of various asset classes. The financial information included in this Investment Update should be read in conjunction with the Interim Financial Statements.

Portfolio update
We continue to invest in assets that build strong futures for communities and members alike.
Below is a selection of activities undertaken since January 1, 2025.

• We acquired full ownership of a high-quality office portfolio in Western Canada that includes seven office properties in Calgary’s and Vancouver's central business districts, totalling 4 million square feet. This portfolio is 95% occupied.
• We broke ground on 70 Hudson Yards, the first 1 million plus square foot, ground-up office development in New York City in over five years.
• We sold a 9.995% stake in Transgrid, the largest electricity transmission network in Australia, to Australian sovereign wealth fund, Future Fund. As part of this transaction, OMERS will manage that interest on their behalf in addition to our own 9.995% stake. 
• We announced a transformative co-investment of over $200 million to retrofit the existing office buildings at Canada Square in midtown Toronto. The redevelopment will deliver 680,000 square feet of highly functional and modernized office space.
• Our shopping mall investments were recognized as national and regional market leaders in sales performance by the International Council of Shopping Centers. Yorkdale continues to dominate as Canada’s top-performing shopping centre for the second year running with ~$2,300 in sales per square foot. Square One Shopping Centre and Scarborough Town Centre also increased their sales per square foot.
• We officially opened the doors to the $1.3 billion Parkline Place, celebrating the opening of this new commercial office and retail destination in Sydney, Australia co-owned by Oxford Properties, and which includes the first new office tower in Sydney’s Midtown in almost a decade. 
• We announced a joint partnership with AustralianSuper that aims to build a significant industrial and logistics venture across Europe. As part of this joint venture, we announced the acquisition of Broadheath Network Centre in Greater Manchester.
• OMERS Finance Trust (OFT) successfully closed two significant note offerings, a EUR 1 billion, 10-year note and a USD 1 billion, 5-year note. This marks OFT’s third EUR and ninth USD offering.

Subsequent to the end of June:

• We broke ground on the first major purpose-built housing project in Scarborough in over a generation on the west side of Oxford’s Scarborough Town Centre shopping mall. The development will consist of three residential towers of 1300 units with the aim of delivering critically needed housing in a historically undersupplied area for people at a variety of different price points, including a 21% allocation for affordable housing. 

Alright, this afternoon I had a chance to discuss OMERS' mid-year results with CEO Blake Hutcheson and CFO & CSO Jonathan Simmons.

I want to begin by thanking them both for taking the time to talk to me and also thank Don Peat for setting up the Teams meeting and sending me the relevant documents.

As always, these are mid-year results, in line with what OTPP and CDPQ posted but OMERS has a different asset mix, more tilted to private markets (see asset mix above).

I also want to correct something from last week when I covered CPP Investments' quarterly results,  OMERS and La Caisse do provide asset class performance for mid-year, OTPP does not.

Alright, Blake began by giving me the overview:

The results are self-explanatory. My main message is it's a very volatile world with respect to geopolitics, with respect to tariff conversations, with respect to currency fluctuations, with respect to elections including in this country.

In the context of all that, we feel our results are a solid start to the year, so we go forward from here with strength but it has been a very difficult investment environment.

You know as well as anybody, one thing you want as an investor is a high degree of certainty, where are the goalposts. This has been a period where there's anything but certainty as the mood of the day can swing depending on one utterance or another. 

The good thing is we have a long view and a diversified portfolio and we really try to separate the headlines form the underlying economic fundamentals and facts. That's our best defence, focus on things we can control: high quality assets, lots of diversification, put our energy into our greatness as opposed to the noise of the day. That's going to continue to be our mantra.

You know me, I started in 2020 so I like to keep track of the 5-year return and the 5-year return since my first month or two has been 8.7% which is a compelling story.

It's been an active semester, diversification is helping.

What you might want to see is the currency hurt us so far this year, it's helped us other years, so you can't have blessings every year. It's cost us 1.2% but we are really proud of our hedging strategy because they protected an additional 100 basis points or thereabouts because it could have been a lot worse if they weren't active. And we took all our hedges off for a number of years after 2020, we were thoughtful and redeployed. It was an overt strategy, it largely paid off.

When we look at our plan, our expectations for the year, our credit book, our equities book, our infrastructure are maybe a little bit behind in some cases but on track to meet our budgets. 

Our other privates are slower. Real estate, the good news is we are in the black now, that's starting to turn the corner. Our mutual friend Dan Fournier has made a major difference in the culture and consideration we've put in that business. 

And our difficult one like many others is our private equity portfolio. We have a new head of private equity, we just finalized the strategy yesterday with our Board as to where that business will go in the future, maybe in the fall we'll take some time to share it with you. We got our arms around where we are strong, where we are weak, where we have to deploy more, where we have to deploy less. That one is a work in progress and we don't see selling or buying, we don't see a lot of activity that gives us data points -- negative or positive -- in the private equity space because again, with all the uncertainty out there, people aren't sellers at prices where we can buy. That business has been our weakest link this half.

I guess the other thing is we remain committed to Canada. The flash numbers say we are down in Canada to 16%, our assets are at about 21% which is where we started the year and it's roughly 55% in the US. The 16% takes into account primarily cash accounts because we used to carry more Canadian cash and we deployed a lot, particularly in real estate the first half. 

But our 21% is constant and we are going to continue to invest heavily in the United States, pretty commensurate with our current book, but we want to do more in this country. We feel this is an all hands on deck moment in Canada, we are seeing really positive and hopeful signs come out of the federal government at this point, more so than we've seen in a decade where government decision makers both federally and provincially in most of the Canadian markets we invest across Canada, there's a harmony that didn't exist, there is a sense of mutual purpose that didn't exist, and I think Canadians are coming together. 

We are hopeful we can do more, particularly in infrastructure and real estate in Canada to be part of the solution in this all hands on deck moment for our country.  

I don't know exactly what that means in terms of allocations -- you know the business well -- we can't give somebody a home court discount, we are a fiduciary, we have to make sure it hits our risk-adjusted expectations and return. It's not that we can -- however big our heart is -- gift anybody when we are responsible for 640,000 people but it does mean we are underwriting more than we have in the past, we are having bigger and more important conversations with various levels of governments than what we had in the last decade.

We want to do more in Canada, we hope to do more in Canada and we want to be part of the go forward success and future of this country.

That's a great overview which covers all the main points.

On infrastructure which had another solid half, Blake added this:

We have 30 assets, it's a broad portfolio, it's a highly concession run asset class for us. With big businesses like Bruce Power, it's been a consistent high single digit asset class for us year in and year out and this year is no exception. It's really the broad shoulders and the consistency of that wide portfolio that continues to get us in the 7-8-9% range and it has less volatility than our other asset classes. You don't see the exit multiples change a lot for those businesses, they stay pretty constant. So it's a steady Eddy business for us, no surprises.

Indeed, the yield is always around 8% or more a year for OMERS and others.

In private equity, I noted that some critics of OMERS purely direct strategy have privately told me that asset class needed to be revamped there but I also note that all pension funds are experiencing a tough slug in PE, not just OMERS, even those that do more fund investments.

Blake responded:

Of our privates, the real estate business not withstanding recent years because it's been difficult, and our infrastructure business  have been really steady long-term producers for us with great teams. And our private equity business has done well for us too and I don't want to diminish the contribution it's made for us in any way.

In the last few years, we have had to rethink our strategy because it's hard to compete with the best players in the world when we are relatively small.  

So, from a buyout perspective, we retreated from direct investing in Europe, we are very much focused on North America. As we cycle out of those assets in Europe, we will use that capital to redeploy into more fund type investments where bigger players with bigger teams can get into assets we couldn't get to.

I don't want to be critical. We have done a detailed assessment, we are at a point and time where we are changing our focus and strategy. We will consistently and deeply invest in Canada and the United States but less so in Europe and the available capital will go to funds.

With our new head of private equity (Alexander Fraser), he just presented the new strategy this week, there will be lots of nuanced changes to that portfolio to right size it and position it well for the future. That is underway, when we are ready, we will be happy to share with you those prospects.

But we have a really good team, we have a really good new leader and I'm actually energized to see their direction of travel. This was a difficult half not just for us but for most people in the marketplace and sometimes when you get those difficult moments, it gives you the motivation to make the changes you need to make and we are making them.   

I noted rates are higher for longer, dampening returns in private equity and real estate and the other thing that worries me is if there will be more inflation in the US, wage inflation can lead to more margin compression in private and publicly listed businesses.

I also noted there was a big Bloomberg article yesterday on how pension funds missed the big tech rally, but pension funds are not there to beat the S&P 500 every year, so while there may be some pressure in privates over the short run, over the long term, they offer more stability and yet people remain focused on the short term.

I asked Blake if they've been feeling this pressure to take risks where they shouldn't be taking risk to deliver higher returns and he responded:

Jonathan and I feel incredibly supported by our board. I can honestly say while short-term results are interesting and certainly people watch our annual results with vigour, we are a long term investor. I don't feel any compulsion to beef up the shorter term at the expense of the longer term.

We all have to be nimble right now. It's an ever changing world. We need to remain on our toes. We need to be assessing all of the inputs from an economic, political and fundamental perspective. You can never be complacent and continue to win in the markets but I don't feel any compulsion to think short term because of the short term pressures, never have, it's not the nature of our board, it's not the nature of the way we approach the business.

And great assets, great management teams, great fundamentals, not in every cycle but they tend to see through cycles, when you compromise asset quality, when you compromise people quality, when you compromise businesses to get some short term yield, it doesn't end so well. 

That's the discipline and that the discipline that has enabled us to deliver our 8.7% return in the last five years.

But the private equity component of our business, this isn't something we picked up this year and decided we needed to have a new direction, this has been a 2-3 year focus and it's going to require a few more years to get it to a place where we expect it to be as part of our asset allocation.

Since Blake is an expert in real estate (he was formerly the head of Oxford Properties prior to becoming CEO of OMERS), I asked him if he's seeing signs of a comeback in offices since more companies are demanding back to the office from their workers.

He responded:

I think you've heard me say this consistently even during Covid, people need to live somewhere, people need to work somewhere.

Even in Covid, when everyone was saying the office is going the way of the dodo bird, we were building office buildings at Oxford. 

The truth is high quality AA, AAA office buildings will continue to do extremely well and didn't even break during Covid.

Secondary and tertiary assets, many of them are in deep trouble because there is a migration to quality.  

Looking at office, our portfolio is best of class in every market we are in around the world. In Toronto, we are 95% leased, across Canada, we are practically 95% leased. We just invested by buying out CPP Investments in seven big office buildings in Canada which put sour conviction where our wallet is.

We just announced a new building we are building in Hudson Yards, 70 Hudson Yards in New York, a large consulting firm is taking 800,000 square feet of 1.4 million, and that will be the first new office building in five years in Manhattan. I'm totally confident it's going to do extremely well.

So in our 62-year history at Oxford but even in the last 10 or 12, when people say thou shouldn't touch and something is going in the wrong direction, we look at the history, high quality great assets, if they're not playing into the fundamentals, we will. 

And I like our odds. We finished a building in Vancouver called The Stack, it's ahead of plan from a lease perspective. 70 Hudson Yards will be great. We are just finishing a new building in Sidney, it's going to take a while but it's going to do great. 

So, a great office is a great office, we like the trends, we never felt that with high quality assets we were in jeopardy and when everybody else said don't build more, we built more. 

I asked Blake if Logistics and Multi-family continue to be the sectors driving the returns at Oxford and he replied: 

Logistics interesting enough, uncertainty around supply chains, we are not seeing big appetite, a lot of people are sitting on their hands because why take up more space until they see how this game of chess plays out.   

For a while the direction of travel for rates for an industrial building was only one way, it was higher growth than any other sector, that slowed relative to other sectors but we have a great portfolio that's functioning well.  

And multi-family, because it's typically a 97% leased business, you have the ability to finance several. You won't really see an improvement until the cost of funds comes down. Because you have a high level of debt, that has a significant impact on yield and values. It will be better in the next 2-3 years as the Fed rate comes down. Right now, it's an ok sector but until the cost of money comes down, it's not going to be what we hoped.

I shifted my attention to Private Credit and asked Jonathan Simmons what he sees there. 

Jonathan replied:

The private credit strategy, if I look back at the last few years, and we already talked about infrastructure and its contribution, private credit has to be the other one. Very strong returns from that asset class, we've been moving capital into it consistently. It's wheels on a treadmill with private credit because most of these are 5-year deals so the team is very busy with the underwriting. We are so pleased with the risk profile we've seen. A year ago, people asked me a lot of questions about credit quality, bu tit's holding up, the discipline is strong, the returns are very good for our pension plan so it's an asset class to like.

I ended by asking Jonathan and Blake what's keeping them up at night, what are they worried about the most in this uncertain environment.

Jonathan chimed in first: 

I crave for stability. It makes it much easier for decision makers to plan for the future, whether that be taking up more space in one of our buildings, or contracting one of our private equity businesses or getting a new project off the ground that we can invest in from an infrastructure perspective. When that stability comes back to the world, investors will have a much more enjoyable time. And it's been very choppy so that's what I look forward to the most.

Blake then added this:

I've always said, I don't need a competitive advantage, I need a level playing field and please don't break my jaw. And if I can invest in those environments, history has proven OMERS can do that, and my career suggests that's an environment I can excel in.

Because we share more with you than anyone, right now what keeps me up at night is our best friend, our biggest trading partner, our most important strategic alliance, the United States of America, we have deep friendships on both sides of the border. America needs Canada, Canada needs America and we are at a moment in history where that frayed relationship is as sad as it is destructive. 

I think it can be fixed, I think it's going to require deep personal investments by our leaders spending time with their leaders because bees stick to honey. 

It was very difficult to do that until the new government was elected, I think they have a really good shot at it and I think it's really important.  

I don't know if it can be normalized but once we get the terms of engagement finalized, including USMCA over the finish line -- which by the way 93% of the trade of this country is captured by USMCA -- once we get over the finish line, and we remind each other that it's critical for all three parties in that document, it's going to be a difficult time emotionally and financially and economically.

That's what I worry about, how we can fix that relationship or at least improve it, how we get USMCA behind us and how we can work as a unified trading block in in North America to fortify ourselves against whoever the foe may be and make all three nations better because we are better together.  

So those are the things I think about, I think it's an important time in history, and as I said we at OMERS want to be part of the solution by investing in this country if we can a little more and by helping build cross border relations for the best interest of our members and best interests of Canada.

OMERS is doing its part to help all levels of governments in Canada succeed.

Once again, I thank Blake and Jonathan for another great discussion, I really appreciate their time and insights. 

Below, watch Bake Hutcheson at the Canadian Club Toronto discussing his views on leading and investing during these challenging times (April 16, 2025).

Last but not least. I want to sincerely wish Jonathan's daughter Jessica who is fighting cancer for a second time a speedy and full recovery (read Jonathan's post here). 

We are all rooting for you Jessica, stay positive and if you need a little inspiration, watch Isabella Strahan's documentary, Life Interrupted, I highly recommend you do so.