What Does Donald Trump’s Win Mean for the Economy?

Speaker 1:

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Camilla Sutton:

Good afternoon everyone. As we woke up this morning, markets were definitely already moving on the news that the projected winner of the 2024 US election is Donald Trump, a historic moment. So we wanted to take some time to answer how this new political landscape in Washington is going to affect the outlook for both the economy and markets. I'm Camilla Sutton, MD and head of Equity Research for Canada and the UK, and I'll be moderating today's discussion.

To get started, I thought I'd start by introducing our panelist. Doug Porter, Managing Director and our Chief Economist here at BMO, and he's going to give us his views on what this administration means for the economic prospects for Canada and the US. Brian Belski, Chief Investment Strategist at BMO Capital Markets, and Brian's going to walk us through what the new political leadership really means for financial markets. And Ian Lyngen, MD and head of US Rate Strategy, and Ian will provide us an election perspective really from the land of US rates.

And with that, let's get started. Doug, why don't we start with you. Last week you published Talking Points and the title of it was, The Next President's Rude Welcome. So maybe if you can walk us through what this 47th president of the US, what he inherits.

Doug Porter:

Sure thing, Camilla, and good afternoon everyone. So it's clearly not a rude welcome by the equity markets with the S&P 500 at a record high. And I think part of the reason why the equity markets are so buoyant above and beyond just the election results are fundamentally the economic backdrop that the president is being welcomed by, and frankly it's healthy. If we look at, for instance, GDP growth, it's been almost 3% in the past year, better than consensus expected, better than a long-term average.

At the same time, despite that relatively robust growth, we've actually seen inflation come down towards 2%. Not quite there, but almost there, a big, big change from where we were one and certainly two years ago. And finally, while we've seen a little bit of deterioration in the job market, the reality is the unemployment rate at 4.1% is effectively in line with what the Fed views as normal or the natural rate of unemployment. So overall, it's actually a fairly healthy economic backdrop that the president is inheriting.

What I was referring to was the fiscal backdrop, and the one sour reaction we've seen in the markets over the last 24 hours has actually been in the bond market where we have seen some backing up in yields. Part of that is due to the view that we're probably looking at some upside risks to growth, a little bit of upside risks to inflation, but I also think it partly reflects the ongoing fiscal concern. And what I'm talking about there is the $1.8 trillion budget deficit that we saw over the past year, which has lifted government debt to more than 95% of GDP. And just for a little bit of perspective, it was as low as 35% as recently as 2007, so that's a very serious deterioration in a relatively short period of time.

And when we look ahead, ultimately this may be the one break or a possible break on some of the president's aspirations in the years to come, this fiscal backdrop. Having said all that, I'm still relatively confident with the momentum that we see in the economy that we're still looking at roughly 2% growth next year. If anything, I think some of the policy changes that we're potentially looking at could put a little bit of upside on that, and I do also believe that we're likely looking at inflation in the low 2% range. So even with my misgivings on the fiscal front, I think overall, the economic backdrop is still relatively positive.

Camilla Sutton:

We're going to dig into a lot of those pieces throughout today's call. I'll turn it over to Ian quickly here, Ian, can you walk us through, we've had a big jump in rates certainly leading into this election. Do you want to just lead us through before we get to where it looks like we're going with rates, where are we today, and where have we come from?

Ian Lyngen:

We have seen a remarkable repricing in the Treasury market over the course of the last several weeks in the run-up to the election. Now it's important to keep in mind that a good portion of this repricing came in the form of higher breakeven rates, so it's largely a reflationary trade. Yes, there's been a return to positive term premium in a couple of the key benchmarks and we actually expect that that will persist. But as a theme, what we did, is we priced in a Trump victory, but we didn't necessarily price in what appears to be a red sweep or the generally strong performance of the Republican Party and Congress.

And so that additional 15 to 20 basis points that we have seen over the course of the last 24 hours reflects in part some of the fiscal concerns that Doug outlined, but it also is reflective of a market that took a step back to see how things were going to play out. We came into this week unsure if we would have a clear decision by this point today, if not the weekend or could drag on even a bit longer, that was the fear. Fast-forward to this period, we have a lot of confidence in the results, we have a lot more information than we might have otherwise assumed, and that in and of itself represents the passing of a key event risk.

And when we look at something as detailed as the reception to today's 30-year auction, the auction went well, it went well at comparatively high rates and we're looking at that as a vote of confidence in treasuries as an asset class as opposed to any particular indication of the market's perception of the election outcome. There is one caveat that I would add in today's auction results, and that is, historically, the 30-year sector has not been a benchmark in which foreign participants were particularly active, especially not at auction. The 10-year sector, five-year sectors, those seem to have typically been the go-to for overseas buying.

So if we're worried, and I think that this is a background concern that a lot of people in the market have, that overseas sponsorship will step back as a result of Trump 2.0, I think we need to go through the next auction cycle over the course of December to get a really good judge of whether or not that's going to be a problem going forward. Our base case is that they won't, but it's certainly something to keep an eye on.

Camilla Sutton:

Okay, certainly a lot to dig into there too. Doug, why don't we circle back to you for a minute. Can you just walk us through, we set the stage a little bit, walk us through the policies that are going to be the most closely watched. Obviously, there's a difference between what's said on the campaign trail and what actually gets enacted, so from an economic point of view, what will be most closely watched?

Doug Porter:

And I think you make a very important point there, Camilla, the policy rhetoric could be very different from the policy reality in the next couple of years. But I think definitely, the two things from an economic standpoint that we're going to be watching the most closely are tariffs and taxes. Let's start with taxes, and I think this is part of the reason for the very positive equity market reaction today, of course, Mr. Trump has definitely leaned into all kinds of different potential tax cuts.

First and foremost, I think it's fairly clear that the tax reform of 2017 in this environment will be fully extended, that's a big ticket item. I don't think there was too much question over whether quite a bit of it would be extended regardless of who won over the last 24 hours, but with the Republicans pretty much in control, it looks as if we're going to have a full extension on that front.

Above and beyond that, Mr. Trump, of course, also talked about a possible reduction in corporate taxes. He also looked at things as diverse as removing taxes on tips, all kinds of different pledges made throughout the campaign. We'll have to wait to see to what extent and over what time period a lot of these are actually enacted in the years ahead. But I think it's fair to say that generally, we're looking at a lighter touch on the taxation front.

Just before I move on to tariffs, the other important point to make and another reason for the market's very positive reaction today, is I think there's just the view that there will be a lighter regulatory touch more broadly and we're certainly seeing the financials in particular benefit from that. Beyond taxes, the other big force of course where much of the focus is on tariffs, frankly this is one we just do not know the extent to which these policies will be enacted. There's this widespread view that the bark is much worse than the bite on this front, that certainly was the case in the first administration of Mr. Trump, but we are talking about a very loud bark here, a 10% tariff on all imports would be quite significant.

I'm actually of the view that it's not as inflationary as some have made it out to be because likely, first of all, we have to see what the responses are among other nations, but also you'd probably get a much stronger US dollar. And we got a bit of a taste of that overnight, which to some extent would offset the tariff from an inflation and growth standpoint. But I would say from an economic lens, those are really the two big things that we're focused on, again, tariffs and taxes.

Camilla Sutton:

Thank you Doug. Brian, so why don't you give us some high-level thoughts in terms of where we are with markets, where we look to be as we walk into this new presidency?

Brian Belski:

Thank you, Camilla, thank you everyone, it is an honor to be here. So let me just walk you back to get forward, we've been at BMO now for almost 13 years and we brought to BMO a specific call on the US stock market saying that US stocks entered the 25-year secular bull market in 2009. We've been resolute with that call our entire time at BMO, not because we're stubborn, but because we firmly believe it. Doug did an amazing job teeing this whole thing up, saying that on a fundamental basis, the reason why the markets have been so strong, because fundamentally, the economic backdrop funnels through into the fundamental backdrop.

And I've been blessed and fortunate to be doing this for almost 35 years, and I love to say that in my collective career, I've never seen certain areas of the market look so fundamentally sound in terms of earnings dispersion, earnings discernibility. Meaning being able to understand how earnings look, balance sheet strength, debt to equity levels, operating income in things like return on equity and return on assets, so we remain very bullish.

And in this cycle, longer term trend, we've had down periods called cyclical bear markets. We came out of one in October of 2022, we are now year three of the new cyclical bull that brings us into 2025, so we remain positively disposed. We never want to give politicians any kind of credit with respect to the stock market because we've done oodles and oodles of research and published on that research saying that, politics have nothing to do with the absolute performance of the stock market, it can either enhance or detract. So we've talked about some policy things which we still don't know because we need to get the government in place.

In the meantime, I would just caution everyone, and I'll leave you with this, Camilla, that Canada's coming along for the ride, as America goes, so goes Canada from a fundamental perspective because of the proximity of our countries in terms of how we're intertwined fundamentally. But also to remember that investors are too focused on the market overall, and remember, the market stands for the stock market. And the stock market is a market of stocks, and the more defined you can be in terms of your investment styles and the more that you are defaulting to looking at companies which stocks are versus trying to make a market call, you can avoid some of this silliness in terms of the volatility with respect to worrying about if the market's going to be up, down, or side ways for the next day or two.

Camilla Sutton:

How does it look, Brian, for Canada versus the US? Outperformance you see in one of the other countries or pretty much even right across the board?

Brian Belski:

No, we've actually been quite vocal in terms of Canada outperformance, especially the second half of the year, Camilla, and we think there's a very good chance that could filter over into 2025, especially, number one, as a catch-up trade. Number two, the volatility, quite frankly what we're seeing in developed markets including Europe, the continued volatility in China, remember as America goes, so goes Canada.

And I think as we enter and, by the way, increase the velocity of the importance of focusing on stocks versus the market, everyone likes to talk about a stock picker's market, but Canada is a true stock picker's market. If you take out the biggest 60 companies in Canada, Canada is really a small mid-cap industry, and so what we've been very positive on for well over a year now are small mid-cap companies in the United States. So the life-bred of the US and Canadian economy, we spend a lot of money and never discount the US consumer and Canadian consumer for that matter, but it's small medium companies and Canada's got a bunch of really great companies.

We believe the value in cyclicality, the value that Canada provides relative to the US will provide more money into Canada. We've already started to see flows there, so we think Canada from a fundamental perspective, is very well positioned to do quite well relative to the US, it doesn't mean the US isn't going to perform, we actually think the US can do very well, but we think Canada's positioned to do even better.

Camilla Sutton:

Terrific, Brian. Ian, let's get you back in on this. You've given us a really quick overview in terms of the bond market, I can already see there's a whole host of questions coming in about what it means for yields and why. And one of the questions, tomorrow we have Fed Day, Fed's obviously independent, Powell's term extends until 2026, but really what does this mean for the Fed and how will the Fed interpret this?

Ian Lyngen:

I do think that there'll be a lot of focus on monetary policy in the near term. There's this subset in the market that believes that the Fed is going to be responsive to the presidential election results. I'm a bit skeptical of that, I think that we have at least two more rate cuts this year, tomorrow 25 basis points, and then on the 18th of December, and to a large extent, those are simply follow through on the Fed's prior signaling.

When we get into the first quarter of 2025, I suspect we'll probably shift into a quarterly cadence of 25 basis points. So that means skipping January, going in March and assuming that pattern going forward. There are two ways, however, in which the Trump victory could translate into either a slower terminal in terms of the downside of the progress back to normal or a lengthier pause. The first is, in the event that Trump starts to implement very significant tariffs and very significant fiscal reforms early in the process, which given the way Congress works, seem a bit unlikely, but if he were able to pull it off early, I think that the Fed would look to the data in the second half of 2025 from the perspective of it being potentially more limiting on normalization, i.e. a longer pause.

Now I agree with Doug that tariffs aren't necessarily reflationary, in fact, they could be a bigger drag on global growth, but there are other aspects of his platform that could be. One that we haven't touched on is immigration, slowing the influx of laborers could have medium to longer term implications in the scarcity of labor and the tightness of the job market, so that's also a component that we're concerned about.

And then the other way in which the election results could impact the Fed would be through the channel of financial conditions. If Brian's right and the equity market continues to rally further from here, that will ease financial conditions even further, which could be unwelcome from the perspective of monetary policymakers, again, depending on how the economic data plays out. So if anything, I think that reinforces the January pause narrative and to some extent it does put a less normalization focused messaging on the table from Paul tomorrow afternoon.

Camilla Sutton:

Doug, from the Canadian side, does it impact the Bank of Canada?

Doug Porter:

I think at the margin, it may lead them to be just a wee bit more cautious. It's interesting, in the summary of deliberations that we just saw the other day, they talked about the 50 basis point cut that they just enacted and the possibility of more. They specifically said that they didn't want it to send an incorrect message. In recent commentary, Macklem's actually said that they could cut 50 basis points again. I suspect that this might put a bit of a chill into the Bank of Canada, first of all, the sustained weakness that we've seen in the Canadian dollar in recent months alongside the view that the Fed might be just a little bit more cautious in terms of their rate cutting cycle and we've got a little bit of upside risk for US growth and inflation. I think at the margin, this does inject a little bit more caution into the Bank of Canada.

Having said that, we still view that they're on a path, we're still looking for a series of 25 basis point cuts from the Bank of Canada, which will ultimately take their overnight rate down to around two and a half percent by the middle part of next year, that's half of where we were as recently as early this year. The Bank of Canada has been in the league globally in terms of rate cuts, 125 basis so far in counting, and fundamentally, that's one of the reasons why the Canadian dollar has come under some pretty sustained downward pressure. But I don't think it really fundamentally changes the outlook for the bank end, I just think at the margin, it puts a little bit more caution in terms of how quickly they will bring down rates.

Camilla Sutton:

Any level of the Canadian dollar that really matters to the Bank of Canada as we see the weakness having taken place quite dramatically?

Doug Porter:

The Bank of Canada always likes to say there is no specific level that they're targeting or aiming for. I do think they'll get a little bit uncomfortable if it goes well through 140. But Macklem has suggested time and again that it's really not entering into their deliberations just yet and that the spread between Canadian and US interest rates is not at its limit. To me, it's really a laissez-faire attitude that they've taken towards the currency, and I wouldn't at all be surprised if it remains under pressure in the next couple of months.

Camilla Sutton:

Doug, I know we talked quickly here earlier about policies, I can tell there's a whole handful of questions coming in about trade. Do you want to dig a little bit into the impact of trade, both Canada as well as China? What does it really mean?

Doug Porter:

I think specifically for Canada, of course this is the biggest concern I would say with this election outcome, we do have the USMCA coming up for review in 2026, Mr. Trump has already indicated that that review equals renegotiation. Now most of his focus has been on Mexico in particular, it's interesting when you look at the major trading partners with the US, Canada-US trade is much better balanced than any of the other major trading partners with the US. But still, I think the uncertainty alone is a bit of a cloud over the Canadian economy.

The one thing I would point out though, is if you think back to Mr. Trump's first term before COVID from 2017, 2019, even with the NAFTA re-negotiations and all the uncertainty around trade at that time, and the US economy managed to grow by 2.8% at that time, and during those three years, the Canadian economy grew two and a half percent. Not quite as strong as the US, but still a fairly healthy solid pace even with all the trade uncertainty. So yes, it is a cloud on the outlook, but I don't think we should lose the sight of the fact that ultimately, the most important factor for the Canadian outlook is the health of US economy itself, that is the number one driver for Canadian growth.

I think for the most part, the major focus of the trade measures that Trump will be looking at will be mostly China, first and foremost, and then Mexico, and I think he's serious on those two fronts. In the case of Mexico, I think it's more a form of leverage, the kind of tariffs that he's talking about, we'll see whether any of these are in fact enacted. But in China, we've already seen from the first administration and even from the Biden administration that they mean business. And I do not take the threats of heavily increases in tariffs on China lightly at all, I don't know about 60%, but I would not at all be surprised if we are looking at a significant increase in tariffs on China in the years ahead.

Camilla Sutton:

Brian, you've given us some overviews in terms of markets. Can you be a bit more specific in terms of where you look out for this coming year, what specific sectors you think we will see, and particularly maybe focus in a little bit on some of your earlier comments about the mid-cap versus large cap?

Brian Belski:

I'd love to, thank you. We believe that normalization is a broader trend for the next three to five years. We actually started talking about it two years ago, and I think the best chance for normalization comes in the next couple of years. Especially based off of if you think and you go back and listen to what Ian said about rates and what Doug has said about growth, I think the days of these wild volatile swings in markets up 20, down 20 hopefully will come to an end. And that's not normal to be like that, nor is it normal to be at 0% interest rates and have the type of fiscal and monetary policy that was thrown at that.

Now be that as it may, earlier this year, we published an initial 5,100 target on the market, that being the S&P 500 of the proper index in the United States, increased it to 5,600 in May and then increased it again to 6,100 year-end in September. It's rare that we increase a market target like that twice in a year, I've only done it twice in my 35-year career, and so the conviction level in terms of the bull market remains very strong from us.

We're overweight in the United States from our sector positions in the research that we publish at BMO on behalf of BMO Capital Markets for overweight technology and financials. We think obviously financials is the "pick to click today," and I think the reason for that and why you've seen this massive outperformance is the massive underperformance of financials heading into this year. The massive, I think, from an institutional perspective, non-positional holdings of financials, and we think from a fundamental perspective, we think across the board, both the US and Canada by the way, financial sector earnings are way understated.

And I think too, something that Doug talked about, president Trump is going to be excessively active in regulations, meaning taking regulations out of the market, and that's a big bid for financials in our view. So we've been resolute on financials who've been bullish for a long time, so we think tech and financials are where you want to be overweight into the end of the year. We're publishing our 2025 forecast here in a couple of weeks, so I don't want to steal that thunder. In Canada, we've been overweight four sectors all year long and I think that's testimony to how much our conviction in Canada, if we're overweight more sectors in Canada, that says something, number one.

Number two, going back with respect to opportunities, it's technology companies, it's financial companies, which by the way have really not been liked in Canada, but over the last six months, the financial sector in Canada is the best performing sector, and I think some of the negativity surrounding Canada has been too much. Lastly, we love the consumer in Canada, all you have to do is walk into a Dollarama store and stand in line with everybody else. That company is amazing, and we've owned it in the portfolios that we have the good fortune of running real life money for BMO Wealth in Canada and the United States.

Another great example is Aritzia, look at that store and look at that stock chart, all you have to say is, why are you worried about the Canadian consumer? Look at those two stocks, and we've been overweight consumer discretion all year long. Lastly, from how to think differently, sometimes you want to think differently and it's called being contrarian. We really like the communication services area for yield, there's other great yield areas like REITs, especially in Canada and some utilities, but we think there's a great opportunity here on too much negativity with respect to some of the great telecom companies in Canada.

So over the next six weeks, we think the S&P 500 has a very good chance to make it very close to our 6,100 target. Not to mention our brand new price highs that we've seen in the TSX that people have been outing as well, so our target for the TSX for year-end, Camilla, is 25,500.

Camilla Sutton:

Terrific, Brian. Why don't we spend a minute here just summing up what everyone's views are. So maybe if we go Ian, then Brian, then Doug, we've talked quite a lot here, but it might be worthwhile just spending a minute or two minutes summarizing what you really expect in your field of expertise in the year ahead now that we have a President-elect, Trump. Ian, over to you.

Ian Lyngen:

All right, I'll kick it off. And just generally speaking, we do expect the Fed to continue the process of normalizing rates, perhaps with not as much conviction given the amount of uncertainty that's now been introduced into the outlook. Ultimately, however, what the Fed has done over the course of the last three years, is it has made it clear that it has the commitment and the tools in place to reestablish price stability. And if we think about the pandemic experience, the US decade high levels of inflation, but that only translated through to Fed funds getting as high as five and a half. So going forward, I think that most investors in the Treasury market look at that as the most likely upward bound in the event of a significant inflationary spike.

Now, given that the verdict is still out regarding whether or not a Trump administration will truly be reflationary or if it's simply pro-growth at a moment where the Fed is pulling back from fighting inflation, I think that as a theme, we're actually going to see rates in a remarkably familiar zone. We're now up against that 450 level and 10 year yields I expect will ultimately prove to be a good buying opportunity and I anticipate by the end of the year, we will be back closer to 4% and spend much of 2005 in a range between 350 and 425 give or take.

Now the more interesting aspect will be what happens in the very front end of the curve? We came into this year, assuming the cyclical re-steepening of the curve would be the theme, to some extent that did come to fruition. That's also our bias for next year with the caveat that the second half of the year is going to be quite a bit of a wild card given the fact that the Fed and the Treasury department will need to increase Treasury issuance auction sizes, and that's going to weigh on Treasuries as a whole. So plenty of cross currents, but we're not on the edge of a true repricing into sustainably higher yield territory in the years ahead.

Camilla Sutton:

Brian, do you want to fill in from your side?

Brian Belski:

Sure. Just remember one thing, control what you can control. What does that mean? I think many investors that we spoke to across the world on an institutional basis and our wonderful high net worth people at BMO were waiting until they found out what was going to happen with the election. And don't ever let anything like that control you, they're not fundamental, elections are not fundamental, you know what fundamentals are? Companies, what they do, what they make, how they make it, how they're led, how much money they make from that product or service. How is that product or service valued? What does it mean in the construct of longer term themes, whether or not it's water or AI or power or food. There's a lot of things that you can control, and how you control it is buying the best assets.

And so we continue to believe that the United States stock market is the best asset in the world, we think Canada's not too far behind. We think in the United States, it's not just all about tech stocks, yeah, you should own those tech stocks, but you should also diversify out and own value and dividend growth strategies and small mid-cap. Small mid-cap is the most valuable in terms of a discount relative to large cap that we've seen in our career in an under owned asset.

And if you use a hockey analogy, you always want to skate to where the puck is going, and I think the puck is going to more broader performance across the stock market in the United States. That also holds true for Canada, Canada has been an unloved asset, a lot of negativity heading into this year, but it's been a surprise all performer. Why? Because we believe too many people were emotional and not looking at fundamentals. We think the fundamental construct of what's happening in Canada and controlling what you can control and buying good assets and being a stock picker, I think that you're going to do very, very well with respect to shutting off the noise and really focusing on what you can control.

Camilla Sutton:

Doug, do you want to bring us home here?

Doug Porter:

Sure thing. Well, I think the market reaction we've seen today basically tells you where the risks lie in terms of the economical look over the next year. Fundamentally, we're looking at some upside risk to growth and inflation, a little bit of a stronger US dollar, perhaps a wee bit less Fed easing than would've otherwise been the case and ultimately somewhat higher yields. But I don't want to overplay it, effectively, that's Wall Street's playbook on the Trump trade, we saw that in 2016, we saw it earlier this summer when it looked as if Trump was in a strong lead, that's the initial response.

I'm not sure that's the correct answer over the next few years. I just want to play off of something that Brian has been hitting on and that's, that ultimately, at the end of the day, politicians do not drive the economy. I'll end off by quoting Richard Nixon who once said that, the US economy fundamentally is a hundred million Americans getting up every day and going to work, and now of course it's 160 million, and for Canada it's a little over 20 million Canadians. That's what ultimately drives the economy, it's not the political backdrop.

Camilla Sutton:

Terrific. Why don't we play a little round of rapid fire, so each of you get one word to answer. We're going to go in order, so we'll go Doug, Brian, then Ian and the timeframe will be the end of 2025, so essentially a year and a bit from now. So we'll start with growth, is US growth above or below 2.6%?

Doug Porter:

I can't believe I only get one word here.

Camilla Sutton:

One word, Doug, you can do it.

Doug Porter:

Below.

Camilla Sutton:

Brian, you're right after Doug, and then Ian.

Brian Belski:

Same question, well, Doug's the economist and I'm the American, so I'm going to say above.

Ian Lyngen:

And I go with below.

Camilla Sutton:

Interesting. What about on inflation, US core inflation above or below 3%?

Doug Porter:

Below.

Brian Belski:

Below.

Ian Lyngen:

Below.

Camilla Sutton:

US unemployment moves higher or lower from here?

Doug Porter:

Tough one, slightly higher.

Brian Belski:

Lower.

Ian Lyngen:

Much higher.

Camilla Sutton:

A lot of different opinions there. What about the US tenure yield, higher or lower?

Doug Porter:

I'm going to say slightly lower just because we've had such a reaction today.

Brian Belski:

Same.

Ian Lyngen:

Lower as well.

Camilla Sutton:

And US equities, you're going to see them higher or lower about a year out?

Doug Porter:

Come on, Brian's following me, I got to say higher.

Brian Belski:

Higher.

Ian Lyngen:

I listen to Brian, I say higher.

Camilla Sutton:

US dollar, stronger or weaker against the G10?

Doug Porter:

I'm going to say weaker.

Brian Belski:

Same.

Ian Lyngen:

I'm going to take the other side and I'm going to say stronger.

Camilla Sutton:

What about global geopolitical tensions, eased or worsened by the end of 2025?

Doug Porter:

Can it get better? I'll say they've actually worsened.

Brian Belski:

Ease.

Ian Lyngen:

Ease.

Camilla Sutton:

US corporate taxes, higher or lower?

Doug Porter:

Lower.

Brian Belski:

Lower.

Ian Lyngen:

Lower.

Camilla Sutton:

What about US immigration reform, has it made progress?

Doug Porter:

Marginally.

Brian Belski:

That's not one word, yes.

Ian Lyngen:

Yes.

Camilla Sutton:

Terrific, thank you all.

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