Canada's growth, resource tension and rebalancing

It was an honor to welcome David MacNaughton, Strategic Advisor at CIBC and former Canadian Ambassador to the United States. David joined CIBC earlier in January (press release linked here) and will provide insights to senior business leaders across public policy, regulatory developments, global trade, and stakeholder relations. David served as Canada’s Ambassador to the U.S. from 2016 to 2019, a pivotal period that included the renegotiation of NAFTA. Earlier in his career, David served as Chairman of StrategyCorp and as a Senior Advisor to CIBC Capital Markets, and he previously served as President of Palantir Canada. He is a seasoned entrepreneur and political strategist, having founded and built multiple public affairs and advisory firms. We were thrilled to host David ahead of CIBC’s Annual Institutional Investor Conference taking place this week in Whistler and to hear his perspective on the evolving dynamics shaping the U.S.-Canada relationship.
 
In our conversation, we discuss David’s experience spanning business and government, the highly dynamic geopolitical environment, the need for renewed public-private collaboration, and why politics feel increasingly interventionist today, with populist pressure pushing governments toward protectionism and isolationism. We explore the implications of AI-driven white-collar job disruption, why businesses must treat geopolitics and public policy as core risk drivers, Canada’s role in AI innovation and adoption, and how Canada is rebalancing its resource economy amid global energy and trade shifts. David shares his perspective on Canada’s prior reluctance to embrace LNG exports and its renewed push to be an “energy superpower,” how to interpret volatility from the Trump Administration, and how tariffs have strained, but not broken, the U.S.-Canada relationship, highlighting the importance of the integrated North American energy system and the need for Canada to diversify markets. We discuss how David’s Strategic Advisor role will help clients think about using government support appropriately, his cautious optimism on recent geopolitical shifts, and why maintaining dialogue among allies matters, as misinterpretation and retreating into corners can quickly spiral into escalation. It was a broad-based discussion and we’re thankful to David for sharing his time and unique insights.
 
Mike Bradley opened the show by noting that the 10-year U.S. bond yield had spiked to ~4.3% amid concerns that Europeans could sell U.S. Treasuries in response to President Trump’s Greenland overtures, as well as growing questions about what a spike in Japanese bond yields might mean for global bond yields. Consensus appears firmly in the camp that the Fed will not cut interest rates at the January 28 FOMC meeting. In the broader equity market, the S&P 500 was down modestly (~0.5%) over the last week, with cyclical sectors (Energy and Industrials) leading and Financials lagging. In energy commodities, WTI price appears to have stabilized at ~$60/bbl. U.S. natural gas price recently spiked ~$0.80/MMBtu (to ~$4.00/MMBtu) due to an Arctic blast forecast in the weeks ahead. On the energy news front, Q4 earnings season begins this week with Halliburton and SLB reporting. Discussion on those calls is likely to be dominated by 1H26 international oil spending trends. Mike also noted Mitsubishi Corp’s $5.2 billion deal to acquire Aethon Energy, and his expectation for many more deals across the energy value chain in 2026. He ended by highlighting that President Trump, along with a handful of Northeast governors, are asking PJM Interconnection to hold an emergency energy auction that would allow Big Tech companies to bid on 15-year contracts to supply ~$15 billion of new power plants. IPP equities were the most negatively impacted by this proposal late last week.