In this edition we‘ll discuss how the history of tariffs does not bode well for the U.S. economy and why U.S. investors might be bigly overweight equities. The diversion details a man who invented his own polls that helped him make US$50-million on the election and, as always, we’ll look ahead to the important data points set for release.Canadians have ample economic reasons for concern after the U.S. election but most U.S. economists agree that the expected tariffs are bad for America as well.
Roughly 80 per cent of Canadian exports go to the U.S. so tariff-related dangers to our economy are obvious and significant. There is considerable confusion as to when or how or if duties will be slapped on Canadian goods crossing the border.
These extremes of equity ownership are in part by design. The Federal Reserve cut rates to near zero during the financial crisis to prevent economic collapse, a move that incentivized equity investment over fixed income.
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