In the Money with Amber Kanwar Bond Bull in a Bearish World: Why This Investor Sees Opportunity for Canada Amid Tariffs
Earl Davis is optimistic—and that's rare for a bond investor. In this episode of In the Money with Amber Kanwar, the Head of Fixed Income at BMO Global Asset Management shares why he believes both the U.S. and Canadian economies are stronger than many think—and why fears of an imminent recession are overblown.
Davis explains why inflation isn’t heading back to 2% anytime soon, and instead may stabilize at a higher range of 4–5%. He also dives into the outlook for interest rates—why the Federal Reserve might still cut this year even if it shouldn’t, and why elevated rates could be the new reality for years to come.
He breaks down what’s really driving markets right now, from tariffs and deficits to Japanese bond yields and central bank policy. Most importantly, he explains how to position your portfolio in a world of sticky inflation, persistent government spending, and shifting global dynamics.
Plus, Davis shares his top bond picks—including two investment-grade corporate bonds (Fairfax and Enbridge) and a high-yield name in the defense sector with a 9% coupon.
If you're trying to figure out how to invest in today's bond market, make sense of the rate outlook, or understand where inflation is really headed—this is the episode for you.
Timestamps
00:00 Show Intro
01:30 The lingering effects of the pandemic: deficits and inflation
03:10 Earl’s high-level view on inflation: it’s going higher
08:15 Why Earl thinks the Fed will cut at least once this year, even though he thinks they shouldn’t
10:15 How to position in this type of environment
11:55 Can tariffs be deflationary?
14:00 What happens if there’s a new Fed president?
15:45 What about the bond vigilantes?
17:45 Why Earl believes the bond market is trading off of Japan
20:40 What about Canada’s economy?
23:15 Why growth in Canada could surprise to the upside this year
26:30 Why the Fed and Bank of Canada will move their inflation targets higher
27:30 Why Earl thinks the housing market is not a headwind but a tailwind for Canada
29:40 What about immigration?
30:45 Earl can’t remember ever being this optimistic
32:15 Earl’s Pro Picks
38:20 Goodbye & coming up
Sponsors
This episode is sponsored by BMO InvestorLine. Learn more at https://wealth.bmo.com/wealth/onboard/onlineinvesting/#/set-expectation?lang=en&ecid=pr-2886232INV1-JNBMO20
For over 25 years, Raymond James has been helping Canadians achieve their financial goals. Visit raymondjames.ca today to discover how you can live a life well planned.
Pro Picks is brought to you by ATB Financial. Visit ATB.com/inthemoney for more information.
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DISCLAIMERS
The information provided in this podcast is for informational purposes only and does not constitute financial, investment, or professional advice.The views expressed by the host and guests are their own and do not necessarily reflect the opinions of any organization or company. The host and guests may maintain positions in any securities discussed on the podcast. Always consult with a qualified financial advisor or professional before making any investment decisions.
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In the Money delivers expert stock picks, actionable ideas, and timely money management tips. Hosted by business journalist Amber Kanwar, each episode features interviews with top portfolio managers who suggest ways to achieve good returns. Covering everything from ETFs and Canadian stocks to global investing trends, dividend strategies, and risk management, this show is made for DIY investors, stock market enthusiasts, and anyone looking to sharpen their financial strategy.
Contact: questions@inthemoneypod.com
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