Hey there!
Vince here, coming to you after a jam-packed weekend filled with family, sports, and a whole lot of excitement! Let me tell you, it was a whirlwind, but I wouldn’t have it any other way.
First up, our oldest daughter had her first gymnastics competition of the season in Michigan. She’s been working so hard, and it was amazing to see her out there, giving it her all. Meanwhile, our middle daughter had not one, but two soccer games to keep us on our toes. And let’s not forget about our little guy – he had a hockey practice on Saturday and then played during the intermission of the Windsor Spitfires game on Sunday. How cool is that?! 😎
Now, you’d think that the highlight of his day would have been skating out there in front of all those fans, right? Well, it turns out that the real MVP of his experience was the lanyard they gave him when he walked in. That’s right, a lanyard. And not just any lanyard – one that granted him a magical 10% discount on any merchandise at the Spits store. What can I say, the kid’s like his dad – a sucker for a good deal! 😄💸
In between all the family fun, I also managed to catch the Sunday night AFC Championship game with some buddies. And wow, what a game it was! One of my friends is a huge Bills fan, so watching him ride that emotional roller coaster was almost as entertaining as the game itself. I found myself really pulling for the Bills too – I think I’m just over the Chiefs at this point. But, as much as it pains me to admit it, they did it again. Another AFC Championship, another Super Bowl appearance. I guess my Swifty daughters will be happy about that, at least. 🙄😅
But you know what struck me as I was bouncing between all these different events and conversations? No matter who I was talking to – whether it was other parents at the gymnastics meet, fellow soccer dads on the sidelines, or my buddies watching the game – one topic kept coming up: Trump, tariffs, and interest rates.
And I don’t think it’s just because I’m a banker and people naturally want to talk shop with me. I think there’s a genuine sense of interest and concern out there right now. People are paying attention to what’s going on in the world, and they’re wondering how it might affect them and their families.
As expected, the Bank of Canada went ahead with another 25 basis point cut to its benchmark interest rate on Wednesday, bringing it down to 3%. This marks the sixth consecutive rate drop as the central bank tries to navigate an uncertain economic landscape.
While the rate cut itself came as no surprise to markets, it’s what comes next that has everyone on the edge of their seats.
We could be mere days away from an economic crisis on the scale of Covid, depending on what President Trump decides to do with tariffs.
The severity and timing of these tariffs remain a big question mark, but one thing seems clear: if/when they come, they’re likely to cause some serious economic disruption. This puts the Bank of Canada in a very tricky position.
On one hand, they may need to consider aggressive measures like we saw during Covid – think big rate cuts and quantitative easing – to support the economy through the trade upheaval.
But on the other hand, those same measures risk reigniting inflation, collapsing the Canadian dollar, and fueling another housing bubble. It’s a delicate balancing act with no easy answers.
I suspect Bank of Canada Governor Tiff Macklem is in for some sleepless nights as he grapples with this dilemma.
Taking Covid-level action so soon after the last round of extraordinary measures could have serious unintended consequences. But standing by and doing nothing in the face of a full-blown trade war isn’t really an option either.
So, what does this mean for the rest of us? Well, in the short term, it means a lot of uncertainty.
We don’t know exactly what the tariffs will look like, how long they’ll last, or what the ripple effects will be across different industries and regions.
We also don’t know how the Bank of Canada and the federal government will ultimately choose to respond.
But here’s what we do know: no matter what happens with tariffs or interest rates or any other external factor, we can’t let it paralyze us. We must stay focused on our own goals and keep making forward progress, even if the path ahead isn’t always clear.
That’s where our team at UCC comes in. We can’t predict the future, but we can help you build a financial plan that’s flexible enough to adapt to changing circumstances.
We can help you stress-test your budget and investments against different economic scenarios. And we can be there to provide guidance and support when the going gets tough.
Because here’s the thing: in sports, in business, and in life, the game is never over until the final buzzer sounds. There will always be challenges and setbacks along the way, but it’s how we respond to them that ultimately defines our success.
So, if you’re feeling anxious about the economic uncertainty out there, just remember: you’ve got this. Stay focused on what you can control, lean on your trusted advisors, and keep putting one foot in front of the other. We’ll get through this together.
Remember, success in uncertain times is all about staying nimble and keeping your eye on the big picture. Don’t let short-term noise distract you from your long-term plans.
As always, our team is here if you need us. If you’ve got questions, concerns, or just need a sounding board, don’t hesitate to reach out. We’re in your corner.
To your continued success,
Vince
P.S. Just as I finished writing this e-mail, on my phone popped an alert about one of Trump’s advisors commenting that Canada can avoid the February 1st tariffs if they continue to act swiftly to close their borders to illicit narcotics. Not sure at this point if there’s any credibility to these comments, but it does serve yet another reminder that you can’t get too emotional about this stuff… it’s changing constantly!
