Canadians are living through one of the most dynamic political and economic moments in our recent history, not the least of which are changing US-Canada relations. With household expenses rising, global markets reacting to aggressive geopolitical moves, and uncertainty brewing in the wake of massive political transition here at home, one pressing question remains: where do we go next?
In this episode of Smart Advice, Carissa Lucreziano sits down with the Honourable Lisa Raitt, former federal cabinet minister and current Vice Chair of CIBC Capital Markets, to navigate the complex interplay of politics, economics, and markets. With insight shaped by decades of experience in government and now in the financial services sector, Lisa cuts through the noise to reflect on what matters most: Canada's sovereignty, strategy, and resilience in a rapidly changing global landscape.
Be equipped with insights to make sense of volatility, understand the tools available to weather potential changes in US-Canada relations, and learn where smart money might be headed next. This episode is for every Canadian asking how to turn economic uncertainty into actionable opportunity.
[08:48] Lisa: “What has happened in the time of Trump is we realize that you can't continue on just accepting the United States growth as the growth that we're going to get; that we actually have to do some work ourselves”
[13:42] Lisa: “When you're presented with a dog's breakfast of tons of different policies, some of them are going to be good. The question, though, is whether or not the overall policy direction is such that it kind of takes away all the wins because the losses are so massive.”
Lisa Raitt is the Vice Chair at CIBC Capital Markets, bringing decades of experience in navigating economic and political landscapes. A former Canadian federal cabinet minister, she held key portfolios including Natural Resources, Labour, and Transport, steering policy through complex economic shifts. Known for her pragmatic approach, Lisa now applies her expertise to the financial sector, offering strategic insights on global trade, economic resilience, and market trends.
As host of The Raitt Stuff podcast, she delivers candid, impactful discussions on economic issues affecting Canadians and global markets. A trusted voice in policy and finance, Lisa combines political acumen with economic foresight, empowering individuals and businesses to thrive in an evolving world.
Connect with Lisa Raitt on LinkedIn.
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Carissa: Welcome to the show and to Season Three of Smart Advice, a podcast connecting you with timely financial advice, investment strategies and economic trends, empowering you with insights to make informed decisions about your money. I'm CIBC's financial advice expert, Carissa Lucreziano.
Right now we are living through a pivotal moment in our nation's history. The economy is shifting beneath our feet. Day to day, expenses continue to climb. Supply chains are straining, and the global trade tensions are hitting closer to home — more than ever before, and all of this is unfolding against a backdrop of massive political change. After months of political uncertainty here in Canada, Prime Minister Justin Trudeau's decision to step down and the election of a new Liberal Party leader, Canadians finally know the result of the federal election, liberals winning a fourth mandate and Mark Carney as Canada's new prime minister.
So how did we get here? And more importantly, where do we go next? Joining me today is the honourable Lisa Raitt, someone who knows exactly what it is like to be at the centre of economic change. She has held major federal cabinet roles, natural resources, labour, transportation, you name it. When it comes to navigating the economic environment and political pressures, she's been in the thick of it.
Now she is bringing that experience to the financial world as vice chair at CIBC capital markets. And if that's not enough, she also hosts The Raitt Stuff, an absolute must listen for smart, real talk on economic issues and opportunities that have a big impact here, at home and abroad. Lisa brings a unique combo of political and economic insights, and today we are talking money politics, the Canadian and global economy, and what it all means for you.
Lisa, thank you so much for being here.
Lisa: I appreciate the invitation and yeah, we got a lot of stuff to cover, don't we?
Carissa: Yeah, so let's dive right in. I know you've been busy over the last several months, the last year, and I know you talk a lot about the topics we're going to go through today, so I'm so excited to dig right in. Let's start with one topic that has been on all of our minds: the Canadian and US partnership.
So with Mark Carney now leading a fourth Liberal mandate, and Canada facing the realities of a minority government, how do you see this shaping our relationship with the US and the direction of the economy in the months ahead?
Lisa: So a couple of pieces of good news for Canadians. Number one, we now know who our government is going to be, and I'm going to say for the next four years, because even though it's a minority government, the reality of it is: it's a minority government that is three seats short of a majority, give or take. Maybe it'll go to five seats, or maybe they'll get closer to a majority. But we know what we have right now, and it's highly unlikely. No guarantees, right? But highly unlikely we're going to see anything less than a four year government if that's what the liberals want. They want to have four years, I think they definitely have a path to do that.
So the certainty on who is going to be dealing with the US is in place. I think that's a positive thing. As a result, Canadians should have confidence that we're going to be able to move forward in working with the United States through this period of time where there's much more uncertainty about what's going to happen on tariffs than we've ever experienced in our entire lives.
The other thing that Canadians should be happy about is the fact that we know that Donald Trump is going to be coming to Canada in June, and as a result, there's a bit of a time frame where people will be put into a situation where they'd like to negotiate something so that they can announce it. Oftentimes, when world leaders gather, the actual negotiations over what the communique is going to say, happens weeks beforehand, and by the time you get to the meeting, all of the stuff has pretty much been agreed to. And the meetings are a good discussion point, but for the most part, you know what's going to be the result of that meeting.
That puts a pressure, I would say, on both Donald Trump's people and on the people in Canada to try to get to some kind of an agreement, a path, a process on what we're going to do about both the security announcements that the President is saying and as well the tariffs that he continues to muse about regarding goods going across the Canadian-American border.
Carissa: Yeah, and that is good news because, I mean, early on, but it does seem that Mark Carney has a real diplomatic approach to engagement, or he's looking for that. He's been noted to emphasise the importance of, you know, mutual respect and willingness to work with the US administration. So, again, that is good news.
Lisa: I think so but I do want to give one more caveat. We put some really good diplomatic people before Mr. Trump as well in the past. I would point out that Dominic LeBlanc is probably one of the more charismatic ministers from the Trudeau cabinet, and is also in Carney’s cabinet now as well. Very well liked, gets along with absolutely everyone from New Brunswick. He's the one that went down to have dinner with Donald Trump in Mar-a-Lago, along with Prime Minister Trudeau.
But even that didn't necessarily help. So yes, Mark Carney understands what's ahead of him, but the magic in all of this is trying to figure out what kind of a win can be given to the president in order for him to agree to give us more certainty on how our economic ties are going to move forward in the next number of years.
Carissa: Yeah, that leads us into kind of the next piece here is talking about the growing wave of economic nationalism. So why are Canadians back in the spotlight and more people are — they're paying attention to what is made here at home. With the tension shifting daily globally and with the US, where do you think the government should be leaning in?
Should we be doubling down on sectors like manufacturing, for example, and when it comes to trade, what policies would actually move the needle building a more self-reliant and self resilient economy, which I think all would agree we have a good opportunity to achieve.
Lisa: Yeah, the last part of your question is, to me, the most important part. When you're faced with a dilemma like we're faced with in Canada, which is what we thought was a very friendly and familial trading partner who suddenly decides that we're more antagonistic and more on the enemy side, it's a bit of a culture shock for us, quite frankly. We don't see ourselves as being an enemy to the United States at all. We view it as a very important, close relationship. It's a family relationship. There's so much family on both sides of these borders. Grandchildren on one side, grandparents on the other, kind of thing.
So the first thing that we have to think about is, how do we deal with that problem, specifically? How do we get the administration to understand that we want to have free trade, and it's a benefit to both countries to do it. So you have to continue to work on that area and go along as if the status quo is something that we're going to return to, only at the same time you have to hedge your bet. Once bitten, twice shy. Fool me once, shame on you. Fool me twice, shame on me.
The resilience of the Canadian economy should be as equally important to the Carney government as is getting a solution with Donald Trump that works for our current industries. In order to build the resiliency of our country's economy, you have to think about things in the long term, and you also have to go with what we're good at. What we are good at in this country is natural resources. I'm unabashedly in favour of making sure that our forestry sectors, our mining sectors, yes, our oil and gas sectors, our agriculture, our fisheries, all of those, are what we used to view as the old style industries. Those are the things that we do exceptionally well, and we hold, I would say, an advantage over the rest of the world.
And as such, if we are doing things in those sectors in those areas that are depleting our productivity, making it more expensive to do business, making us uncompetitive with the other places in the world, or if we simply don't have a trading relationship with the rest of the world for that product, and I'm looking at oil and gas when I say that, then that is the piece that a government equally has to look at. What's our long term prospects, what investments are needed, and how can the government get out of the way to make sure that investment can flow into those areas?
I think what has happened in the time of of Trump is we realise that you can't continue on just accepting the United States growth as the growth that we're going to get; that we actually have to do some work ourselves, and I think it's a great thing, and it's an opportunity, but we have to make sure that the government understands that it may not work with some of the policies that they passed in the 10 years that they were the government.
Carissa: Yeah. That's really well put, and thank you for kind of laying it out that way, that Canada really needs to focus on their own growth. It'll be interesting to see what the next move is, and where we prioritise.
It's been anything but quiet south of the border, as you know. Since the new president took office, there has been a flurry of moves on everything from trade to tech to China. What do you believe is driving the US administration's agenda right now, like in all these activities, even if you want to sum it up, you know, to the first 100 days, is there meaningful progress for the United States?
Lisa: I don't know if there's meaningful progress. What I will say is, if anything that Donald Trump is doing he told you he was going to do. Whether or not you believed him literally or figuratively, you're getting the literal interpretation of everything he said he was going to do. There should be no surprises that he does things.
What I find really interesting about the discussion about Donald Trump is he'll say that I'm going to put tariffs on Canadian cars, it's going to be 25%. The automatic response from people who are opposed to him doing that is to meet it with the logic as to why it won't work. It won't work because it's going to hurt you more than it hurts us. It won't work because the supply chains can't handle it. It won't work because it's going to cause a recession.
Those kinds of arguments against the act fall on deaf ears with him. He is willing to see whether or not his action is yielding the result he wants, but he's willing to go through some pain to get there, and he has said that. He said it may be a little painful for us, but I promise you that after these things settle, America will be better than it once was. America will be great again, to use his own terminology.
For the most part, the American public are with him and believe him, his approval ratings are still very good, and you're not getting a lot of pushback. There's a lot of rhetoric around whether or not he should be doing it, but he's still doing it, and he is still enjoying popularity in the United States. So that's, I think, something that we have to realise.
If we pin our hopes on the midterm elections, for example, that's going to change everything, or it's going to change when the stock market falls. The reality is, we don't know if that's going to impact him. You're assuming. You're assuming he's going to approach these kinds of indicators in a rational way and anything that I can say, see is a lot of his decisions, although we know what they were or were going to be, they're not necessarily the norm. They're not the rational kind of way in which we approach these trade matters.
I don't speculate on when he will do things, or when he'll even agree to stop doing things. It's going to be totally within his own definition of when it's detrimental to him personally.
Carissa: Yeah and if we look at the policy proposals and the strategies coming out of the Oval Office, are there any specific areas of focus you think could actually benefit the US over the longer term?
Lisa: So in the history of the United States, or in the last number of, 50 years, we'll say since World War Two — it's even longer now I guess — what we've proceeded in the world on is that global trade is good for everybody and that it's beneficial to the American economy. The unfortunate result in a lot of states in the US is that, as they were not as competitive as other Asian states were and as containerisation, for example, was developed and we could move quantities across vast oceans in a cheap way. The reality is that it became uneconomical to produce in the United States, and they lost jobs. And Donald Trump is driven by having the economic activity come back to the US in the form of manufacturing.
The reality is, there's only so many people in the US, and there's only so many jobs that they want to do, and they may not want to do all the ones that are coming back. But he has reoriented some things. He's brought semiconductor chips back to the United States. He has continued on some of the clean tech stuff. He's doubling down in nuclear energy, and he's going to build some more nuclear reactors, which is good for the electrical grid, quite frankly.
Yeah, when you're presented with a dog's breakfast of tons of different policies, some of them are going to be good. The question, though, is whether or not the overall policy direction is such that it kind of takes away all the wins because the losses are so massive.
Carissa: Yeah, that'll be an important thing, I think what everybody keeps on watching. There's been a lot of chatter lately, some tongue in cheek, but some more serious about the idea of Canada becoming the 51st state. Like for most Canadians, the very thought of losing our national identity hits a nerve, just to say the least.
From your view, is this just you know, political noise, or does it truly reflect a deeper unease of what could be for Canada when it comes to currency, personal, corporate tax, trade, health care and education, and there's many, many more. What would Canadians stand to gain or lose?
Lisa: Well, we gain nothing from becoming the 51st state. I'm absolutely violently opposed to anything like that happening. Although we're families, we're different pieces of the family. We're different branches of that tree. We took a very different path of democracy in Canada, as did the United States. Well, you could say our origins both come from the same colonial background. The reality is we're very different people.
Becoming the 51st state is, I would say, is an abhorrent image for most Canadians, and that's why it's not going to happen. However, what he does speak to when he's talking about the 51st state is a ham-fisted way of talking about wanting to have closer trade, security, economic ties, which we can do. Which we can do without becoming the 51st state.
Am I in favour of a North American security agreement? Absolutely. We're one massive land mass. Why don't we have security agreements up and down the continent? Am I in favour of a transportation system that's better integrated? 100%. We should be in a system where you only have to have a container checked once when it lands in the North American continent, not having to go across all these borders. But that's not about becoming the 51st state. That is about having two sovereign and maybe three sovereign entities having agreements with one another.
So I'm not, I don't mind a close relationship with the United States, but I will not subsume my sovereignty to that because I am not an American.
Carissa: Yeah, and that's a really good perspective, like in if you think about the way in which Canada and the US can work together to become closer and to be able to achieve much more efficiency through doing many of the things that you mentioned.
Lisa: I can understand the frustration that the Americans have with Canada, and specifically in the area of defence and Canadians and I— I was a sitting Cabinet Minister for seven years, and I was in Parliament for 12. We have been abusive in our relationship with the United States when it comes to national defence and security, quite frankly. We haven't spent any money. We've always just assumed that, because of our proximity to the United States, that they would defend us in case of a problem in our home country. That's not fair.
They spend an awful lot on defence, military defence, and they are well suited to be able to look after themselves and for us to say, well, we choose not to spend money on that. We're going to choose to spend money on other things, because you guys are going to protect us without saying to them, "By the way, we're going to do this. Do you mind? You know, do you mind if we focus on something else?” Instead, we just kind of brazenly take advantage of their willingness to help us. We can say we're in NATO, but we're not pulling our weight in NATO at all, and all governments have done that.
Let me tell you a quick story that was told by a former ambassador from the United States to Canada at an open meeting. So I'm not telling tales at a school here. We were talking about defence. If you are a Democrat, if you're a Republican, if you're independent, you all have the same opinion on Canada being a laggard in defence spending. And many, many years ago, it was Bill Clinton and Paul Martin who were the two coordinating Prime Ministers and Presidents. They were in a meeting. Their ambassadors were there, and the ambassador tells the story that the topic of national defence came up and whether or not Canada was spending enough.
Allegedly, I believe the ambassador, the Prime Minister of Canada, Paul Martin says, “But listen, Bill, let's all face it, we're not going to spend any more money on defence because we know that you guys are going to protect us.” And Bill Clinton looks at Paul Martin and he says, “Well, that may be the case, Prime Minister, but I really wish you hadn't said it like that, because that doesn't make us feel very good.” Since that moment, it's been one of those cases where Americans kind of gave us a side eye. We serve with them nobly in our exercises around the world and Canadians have commanded Americans, and Americans have commanded Canadians, and they work very well together with respect to those missions.
But the reality is, is that when it comes to being asked, for example, can you help us out in Haiti? We said no, and that would grind my gears as well, to be honest. So Canada's got to get their act together.
Carissa: Yeah, and thank you for sharing those stories. It ties a bit of history of a perspective into it. Let's switch a little bit. Let's talk about the markets. We know we've had a wild ride, to say the least, in the markets lately, the volatility, headlines, there's been a lot of hand holding. Despite this noise, Canadians are still putting their money to work and investing for the future.
Let me ask you, if we look ahead six to twelve months, where do you see the smart money going? Like what sectors are emerging? Tech has been a really hot topic, as we know, for example, Nvidia bringing chip manufacturing stateside.
Lisa: I think everything is going to be about power generation. The reason being is that I know our grid fairly well, and I know the grid of the United States, and we've done so much already on becoming efficient in how we use energy. We've exceeded our ability for efficiency to make up for demand, and now we're at the point where we have to build we have to build a supply, and I think that's going to be something that regardless of who's in power, who's not in power, you can't deny the fact that you're going to need to have more electricity flowing, or you need to make sure that you can, you can power your communities better.
And I like that. And I think a Carney government, a government of any flavor in the United States, or in the states themselves, which do these kinds of things, that's going to be a focus on any government. Because in order to attract business to your community, in order to grow the economy through immigration, you need to be able to supply them with the electricity that they're going to need. If I take a look at Ontario, and the reason why the province of Ontario has really embraced this notion and is talking about building power generation is we're at a point where they even add, like a single greenhouse in Leamington, Ontario, the question of whether or not you have enough electrical output to be able to service it is a real one.
I would say, if we're looking out from six months to six years, that's the other space that I would be looking at.
Carissa: That's good. And a lot of investors are thinking about their portfolio and diversification and what sectors and how to be weighted going forward. What would you say, you know, investors need to focus on, in line with what you just mentioned? How can the average investor think about ensuring that there's good diversification in their portfolios?
Lisa: I think they always have to take advice from experts at CIBC. Even I don't rely upon my own sense of what's happening in the world or in politics to guide me in what my investments are. I find that whenever I receive advice from my advisor here at the bank, it really is the best way, because they understand what's happening in the market, and they understand the flows in a way that I don't.
What I do bring and what I can advise on, and what I do in my job here at CIBC is to try to get a flavor of where I see public policy is going so that you can determine whether or not there's going to be investment opportunities. When I say that governments are going to be concerned about electricity, then there's a whole bunch of places where you can invest there. One of the other areas of public policy that I'm wondering about that I don't really know the answer to right now is whether or not the Carney government is going to be in favour of allowing pipelines be built to tide water for both oil and for gas, in order for us to be able to diversify our supply from somewhere else but the United States, which is a really, I would submit, a really important kind of economic activity for us.
But, given the fact that the past 10 years within the Liberal government, they really have made it harder and harder to build these kinds of pipelines. I would say that that has dampened the interest of business to make these investments, because it's become very expensive. If there is a policy change where the Carney government shows that they are in favour of these pipelines being built after a good environmental process and good indigenous participation, then I think that that is going to be an indication that we're going to be moving in the direction of increasing our production of oil and gas in the country, which I think is a really big thing. But standing here today, I really don't have an idea as to where they're going to go, just hopes and wishes. That's all.
Carissa: Yes, yes, absolutely. So it leads me into kind of the final question, what I'd love to ask more of a summary. In everything that we discussed today, and we discussed a lot, as Canadians are listening in, where should we be looking for the true size of optimism like no one has a crystal ball. But if you and I were sitting down a year from now and discussing similar topics, how much ground do you think the Liberal government will cover to build so much needed confidence and comfort for Canadians, and, you know, a stronger economy at large.
Lisa: It's an excellent question, and I am always optimistic at the beginning of a new government term, even though I will tell you that this new government looks an awful lot like the old government for the last 10 years. Until I see the cabinet and their speech from the throne, which will be coming at the end of May I don't have a clear indication as to what direction they're going to take us.
That being said, I think that knowing you have a stable government free from interference from a foreign government that understands the economy and wants to do better in the world is a positive thing. May not be my choice of a government, but I am looking forward to working with the Prime Minister and his cabinet, because the greater good is for Canada to be resilient economically in the long term: something we can be proud of that keeps our kids here in Canada.
I'd offer one other observation that I hope that the government stays away from, and that is this. I had a conversation with the just former ambassador to Canada from the United States. His name is David Cohen. Very thoughtful man. He was appointed by the Biden government. So he's a Democrat by nature. He reminded me in our conversation that as we react to Donald Trump and his administration, don't blame all Americans for the problems. So when we talk about elbows up, when we get very- when we boo their anthem, when we react to them in such a negative way, he reminded me that there's a whole bunch of people in the United States that don't share the views of the Trump administration, and as such, we should approach our differences in a way that doesn't alienate a fair amount of the population in the United States.
I took that advice to heart, and I'm not prone to these days. I get elbows up. I think it's interesting and it's important, but I also remember that there's over 350 million American citizens, and not all of them agree with Donald Trump, and a lot of them are friends and family. If we show an understanding — as we are to do as Canadians — to the United States, I think it's going to be a better orientation for us than it is to come out guns blazing and wanting to fight with everyone.
Then the last thing that I would say is that, one of the saddest things for me is: the thickening of the border between the United States and Canada. I spent my entire career in transportation, even before the government. I was in transportation because I ran the port authority here in Toronto. I know the importance of having a border that is secure, but as well, is amenable to the trade of goods and people across between our two countries.
Right now, you hear of people not wanting to go to the United States, not wanting to cross the border, fears of what happens at the borders, and that's not beneficial to us if we want to get to the point where we were before and then beyond that of being, one land mass that we can actually work with each other on and depend upon one another.
We should always have that as our minded goal at the end of the day, and that we're going through a difficult time right now, and we will defend who we are and what we are, but we should strive to find the common ground for all of us without ceding our sovereignty.
Carissa: Yeah, well said. A lot to be proud of as Canadians and as Canada going forward, but also a lot of work to do to strengthen, you know, a historical relationship with our neighbors. So thank you so much, Lisa, for sharing your insights today. It has been a very powerful conversation.
Lisa: You're most welcome. Thank you so much for inviting me, Carissa.
Carissa: In a world that is shifting fast, one thing that is very apparent is that Canadians are not standing still. We are builders, innovators and extremely resilient, whether you are navigating decisions for your family, leading a business or shaping your future in retirement, the path forward becomes more clear when you have the right tools and are confident about your plan.
At CIBC, we are here to help you turn uncertainty into opportunity, providing you with advice to move forward with purpose. Regardless of the evolving economic landscape, your future is yours to shape.
Thank you for tuning in to Smart Advice. I'm Carissa Lucreziano. If you enjoyed this episode, feel free to share it with your social network. To make sure you never miss an episode follow smart advice on your favourite podcast platform. For more tips, tools and financial advice visit cibc.com/smartadvice.