TOP STORY
🛢️ Price of Oil Surges 30% After Russia Export Ban

Since June 1st, WTI, the benchmark crude for North America, surged 30% to ~$90, its highest level since November 2022.

The price was driven up by Russia's abrupt and indefinite ban on diesel exports, a move announced by Prime Minister Mikhail Mishustin this week to stabilize domestic fuel prices. Bank of America, Citigroup, Goldman Sachs, and Chevron are predicting a return to $100 oil before the end of the year.

This restriction applies globally, with exceptions for Belarus, Kazakhstan, Armenia, and Kyrgyzstan, members of the Moscow-led Eurasian Economic Union. The unclear end date has raised concerns about fuel supply disruptions, especially as winter looms and global diesel inventories are already depleted.

Adding to the price pressures, Saudi Arabia, a major player in OPEC (Organization of the Petroleum Exporting Countries), has committed to extending its production cuts.

FROM OUR FRIENDS @ HAMILTON ETFS

📣 Hamilton Launches Canada’s First Covered Call Fixed Income ETF

On September 15, Hamilton ETFs launched the new Hamilton U.S. Bond Yield Maximizer ETFs ($HBND) with a 10%+ initial target yield, combining the strength and security of U.S. treasuries with the higher income and tax efficiency of covered calls.

As a quick refresher, a covered call strategy means that the fund sells ‘call options’ on a portion of the underlying holdings. The ETF provider (in this case Hamilton), earns money from the ‘premiums’ investors pay for those call options, but limits some of the upside on those holdings.

Covered calls are a popular strategy with income investors, which up until now have been primarily used to generate additional income from stocks. With $HBND, Hamilton ETFs is the first to apply this income strategy to bonds.

In an interview with BNN Bloomberg, Nick Piquard (HBND’s portfolio manager) explains the inception of the fund and how the current interest rate environment and bond ETF market have made this ETF possible.

In Adriano’s interview with Nick and Pat Sommerville (Senior Partner, Hamilton ETFs), they discuss some key advantages of $HBND:

• Tax Efficiency: Unlike bond income, covered call premiums are taxed as capital gains (not foreign income), which are treated more favourably from a tax perspective.

• Low Credit Risk: 100% invested in U.S. treasuries with a focus on long-term durations.

• Reduced Volatility: Covered call strategies help reduce volatility.

• CAD-Hedged: Hedged against the Canadian dollar so investors don’t have to worry about exchange rates.

So if you’re an investor looking to maximize monthly income via exposure to the U.S. bond market, definitely check out $HBND!

MOST TALKED ABOUT THIS WEEK
🪧 UAW Strikes Continues, Ford Strikes Agreement in Canada

The United Auto Workers (UAW) union intensified its strike against General Motors (GM) and Stellantis this week, pushing for higher pay, shorter work weeks, strengthened job security, and more.

The union widened the scope of the strike to include 38 parts and distribution centers across 20 states, aiming to disrupt the highly profitable repair operations of dealerships.

UAW President Shawn Fain announced Ford would be exempt from this escalation due to significant progress in their ongoing talks.

This followed Ford’s recent tentative agreement with the Canadian union Unifor, which successfully avoided a potential strike involving more than 5,000 autoworkers in Canada.

Ford’s proposal to Unifor:

• Wage increases up to 25%, including a 10% increase for the first year, followed by 2% and 3% in the succeeding years

• A $10,000 bonus for all active employees, as disclosed by the union.

Unifor, representing around 5,600 Canadian auto workers, unanimously supported this tentative agreement.

Regardless of the outcome, some members of the Blossom community are quick to highlight that the biggest beneficiary of the strike will be Tesla/Elon Musk with @veblen_goods sharing an interesting article from the WSJ.

BIG ANNOUNCEMENT
📚 The Blossom Learn Portal is Live!

Many of you might have noticed that we haven’t put out many updates for the past 2 months - well that's because we were working on a huge new addition to the app: Blossom Learn 📚

Blossom Learn 📚 brings fun, Duolingo-style investing lessons directly into the app, helping you go from a complete beginner to an advanced investor!

We’ve already launched lessons on Investing Mindset, Compound Interest, How to Read a Stock Quote, Beta, Earnings Per Share, and more, with new lessons coming every week.

Super excited for you all to check it out!

IN CANADA
😰 Canadian Inflation Accelerates, Retail Sales are Dropping

In August, inflation rose 4% year-over-year, up from 3.3% in July. This big increase in the Consumer Price Index (CPI) raised eyebrows as it overshot estimates for the 2nd straight month.

The increase in CPI was largely attributed to a 0.8% increase in gasoline prices year-over-year, a rebound from a 12.9% decrease in July.

@CanadianStocks broke down the CPI report in this post 👇

In August, Canada also saw a slowdown in consumer spending, with retail sales dropping by 0.3%, the first decline since March 2023 and contrasting with a 0.3% increase a month earlier.

This decrease may be due to the impact of higher interest rates implemented by the Bank of Canada, which cut into household budgets.

Notably, the central bank kept borrowing costs steady on September 6th, affirming that the increased rates were slowing down the economy and consumption.

 FROM THE BLOSSOM COMMUNITY

🎙 Top Discussions This Week

🗞️ What else you might’ve missed:

• Goldman Sachs ($GS) agreed to pay $6 million for sending inaccurate or complete trading data to the SEC.

• Toyota ($TM) will speed up electric vehicle production from its Toyota and Lexus brands.

• Microsoft ($MSFT) debuted its new Copilot platform, an AI service that works across Windows 11 and Microsoft 365.

• Snapchat ($SNAP)’s premium offering has reached 5 million users.

• Uber Eats ($UBER) is launching a Google ($GOOG) powered AI chatbot.

• Starbucks ($SBUX) has committed $220 million to a new campus in China.