Welcome to November 2025
Hello November!
The month is half over and there is a lot going on economically. Last week I was invited to an economic forum by BCFSA, the BC financial services regulator. The keynote speaker was Stephen Poloz, former governor of the Bank of Canada and there were also a number of other economists and financial services leaders across Canada. Here are my takeaways:
· Stagflation is the most likely economic reality for the next few years
· The Carney budget, although not garnering official support, was generally accepted by most with guarded optimism
· Poloz expects the US tariff negotiations to end next year with a deal Canada can live with but will not be as good as the previous trade agreements
· The housing crisis, despite desperate government and non-government efforts will not be fixed in the short term and will have to wait for the market to adjust over the long term
· Carney is determined to develop Canadian resources in an environmentally responsible manner
I know, you are wondering what stagflation is…essentially it is low economic growth, higher interest rates and higher inflation – thus the fusion of the words stagnant and inflation. The mood of the speakers and panelists was quite gloomy. However, there was some optimism with the new opportunities the experts think will come from AI (artificial intelligence).
Poloz chronicled the historical major economic shifts with the first in the late 1800’s being the shift to Agrarian production (individual food production to farms), then the Industrial Revolution (steam engine and factories), post WWII economic expansion, Computer Age (starting in the 1990’s) and now the Artificial Intelligence Age just beginning. Poloz noted that initially the inventors in each era had short term success, whereas the real winners were the perfectors of the inventions who were able to apply the new invention practically. And this is where we are at with AI. Many companies are experimenting with using AI as it has tremendous potential.
I read an article from Elon Musk recently stating that his Optimus robots will very soon be able to perform delicate surgeries that human surgeons are not currently capable of. The article goes on to say that this will cut the cost of health care down while increasing universal access to everyone. Pretty bold statements, but an example of how industry is already deploying AI.
For investment recommendations, we continue to like mortgage investment corporation shares due to their diversity in the mortgage market and steady returns that have outpaced the stock markets over the long term. We are also seeing a lot of investors taking our GICs. Ask us about which GIC might be right for you. If you have investment funds sitting right now and don’t want to rush into an investment decision, we offer the best rates on government guaranteed cashable GICs.
