Canadians are planning for next week\u2019s holiday in an understandably tentative mood. Gasoline prices remain high enough to quash Canada Day travel plans. Homeowners are unsettled by the value of the roof over their heads, even as they await their next mortgage renewal. And, by all indications, our trade deal with the U.S. and Mexico is about to enter a period of annual reviews and renegotiations.<\/p>\n
Ottawa has tabled multiple policy proposals to strengthen the national economy, among them the Canada Strong Fund. It will be designed to drive investment into large projects deemed important to the country\u2019s long-term economy. Ottawa has promised $25 billion to launch the fund, which will be invested alongside institutional and other private investors.<\/p>\n
In a clever bit of politicking, Prime Minister Mark Carney has proposed that the fund be made available to retail investors. These projects don\u2019t need us, of course. Infrastructure projects in this part of the world draw more than enough of the world\u2019s smart money. But building a retail sleeve into the fund is good optics, and perhaps something more.<\/p>\n
First, on the optics. Carney has tabled a big idea at a time when it feels like the country could really use a few. Designing it in a way that allows Canadians to participate directly is just smart.<\/p>\n
John De Goey, a portfolio manager at Designed Securities in Toronto, said the fund reminds him of war bonds. \u201cDuring wars, governments issue bonds,\u201d he said on the Canadian Advisor.cast<\/a>. \u201cThey [would] use that to finance the war effort. \u2026 Canada\u2019s really at war with the U.S., economically. It doesn\u2019t feel like it necessarily, but I think that\u2019s what the Carney government is trying to convey \u2014 that we, as Canadians, need to do whatever we can to support our sovereign interests.\u201d<\/p>\n Second, there is at least the potential for the Canada Strong Fund to become a meaningful savings vehicle for investors. <\/p>\n