Description

In this episode, we discuss the escalation of U.S./Canada tariff tensions with Mark Rutherford, co-manager of Mawer's Canadian equity strategy. Mark provides historical context of how we got here; highlights the potential economic impact tariffs may have on the Canadian economy; provides specific portfolio holding examples of how businesses and industries may be affected; and mentions several potential benefits for Canada. Ultimately, he stresses that adhering to a disciplined, long-term investment approach is vital amid uncertainty.

Key Takeaways:

• In the U.S., manufacturing's decline has driven trade and financial deficits, exacerbated by a strong dollar. Tariffs aim to correct these imbalances.
• Being diversified and adjusting portfolio positioning from a bottom-up and scenario planning lens is key amidst uncertainty.
• Tariffs could cause a potential Canadian recession, a weaker dollar, and lower interest rates. The team is monitoring U.S. dollar strength, risk havens, and possible global currency interventions while assessing the broader economic impact of tariffs on prices and growth
• On the flip side, Canada could benefit from reduced internal trade barriers, increased infrastructure and energy projects, and greater political will to attract capital—potentially driving long-term economic growth, job creation, and higher tax revenues.
• For now, the recommendation is to focus on "prepare don't predict," maintain discipline amid market swings, avoid rash decisions, monitor exposures, and seek long-term opportunities.

Host: Andrew Johnson, CFA, Mawer Institutional Portfolio Manager
Guest: Mark Rutherford, CFA, Mawer Portfolio Manager

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

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Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

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