Trump Tariffs
Trump has followed through with his tariffs. In a way he had no choice, he had backed himself into a corner. Had he not followed through, he would have lost all credibility that he had left.
The risk we face now is if these tariffs are on for a long period of time. I do not believe that will be the case. These tariffs will hurt the U.S. just as much, if not more. It has long been proven that tariffs do not work, much to Donald’s dismay. The reason the U.S. became as economically strong as they are, is through free markets and trade. The markets prefer this and will exert pressure on the U.S. to unwind these actions.
As for Canada, this may be the kick we need to expand trade, grow our industries, and leverage the unique position of our resources to really diversify ourselves. Ultimately, this could end up being a real positive for the Canadian economy in future years.
But in the meantime, there is a silver lining in all the negativity, and we were prepared for this. Much like many of our politicians have voiced, this isn’t the outcome we wanted but it’s the situation we are forced into.
Much like our country, our portfolios are resilient, and our strategy is made for this. The investments we favour are defensive in nature and tend to hold up better in volatile situations. The income our strategy provides allows us to get paid to wait.
What should we do? Just as in other times of uncertainty, the worst thing one can do is panic and sell. We don’t sell into fear and, instead, remain focused. We are currently looking at investments that were recently too expensive to enter. If volatility continues, we will have the opportunity to buy high-quality investments at discounts. These types of opportunities will offer healthy returns for years to come. Times like this, although not fun, can really strengthen our position, going forward, and become a pivotal moment in our growth, both as a country and for our portfolios.
As always, please reach out if you have any questions.
Tchabushnig Wealth Group.
This communication has been prepared by Alan Tchabushnig and expresses the opinions of the authors and not necessarily those of Raymond James Ltd. (RJL). Statistics, factual data and other information are from sources RJL believes to be reliable, but their accuracy cannot be guaranteed. It is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of securities. It is intended for distribution only in those jurisdictions where RJL and the author are registered. Securities-related products and services are offered through Raymond James Ltd., member - Canadian Investor Protection Fund. Insurance products and services are offered through Raymond James Financial Planning Ltd., which is not a member - Canadian Investor Protection Fund.
