The Ruppert Team
The topic of tariffs will stay in the headlines in February and markets on both sides of the border will be attuned to every announcement for specific implications. A key question is whether Trump will use them as a targeted negotiating tactic or as part of a broader strategy to fundamentally reorder the global economy, with potentially uncertain outcomes. Investment markets dislike uncertainty and would not welcome economic disruptions or a resurgence of inflationary pressures. However, US equity markets would cheer other Trump policy initiatives such as tax cuts, which he has said is a key legislative priority. In Canada, tariffs, federal politics, and the pressing need for better growth are all priorities with economic consequences. Read our latest commentary here. If you have any questions about what this means for your portfolio, or would like a second opinion, contact our team. We are here to help you navigate uncertainties and implement hedging strategies.
Our 2025 Tax Toolkit is now available! In the guide, you will find tax tips, opportunities for tax savings, marginal tax rates, and more.
Our in house call is for the BoC to cut by a total of 100 bps by June, reducing the overnight rate to a terminal rate of 2.25%. There are four meetings scheduled over the next 6 months (01/29, 03/12, 04/16, 06/04). While the Bank delivered two outsized cuts of 50 bps in 2024, moves of this magnitude are rare (only previously seen during the Covid downturn and the GFC). If the forecast materializes we’d expect modest cuts of 25 bps per meeting. See our current interest rate forecast here. What does this mean for your portfolio? Reach out to us anytime to discuss and ensure your portfolio is well positioned.
Our enhanced and expanded version of our capital gains report titled Capital Gains Tax Planning contains information on the tax rates of earning capital gains personally and in a corporation, both before and after June 25, 2024, when the inclusion rate increased to 66.67% from 50%. The expanded report also compares the fully integrated tax cost of earning capital gains in a corporation, when all capital gains are taxed at the 66.67% rate versus having those gains taxed personally, where the first $250,000 is taxed at the 50% inclusion rate. The report also addresses the new lifetime capital gains exemption limits, the impact on capital gains reserves, and how capital losses work when carried forward (or back) across periods with different inclusion rates.
At our recent Private Wealth webcast, CIBC's Tax and Estate Planning expert, Jamie Golombek and Chief Economist Avery Shenfeld discussed the recently released federal budget. A replay of the webcast is now available for you to watch at your convenience. If you have any questions or would like to discuss your investment strategy, I would be happy to book a meeting to connect.
When annual return expectations are forecasted, investors can rebalance or reaffirm their asset allocation based on their individual comfort level with risk as well as global market and economic forecasts. Each year, our Multi-Asset and Currency Management team and our Total Investment Solutions team develop long-term return and volatility expectations for various asset classes. These expectations are the cornerstone of our strategic asset allocation thought leadership and client advisory services.
In the 2024 edition of the annual Long-Term Annualized Capital Market Expected Returns report, investment professionals discuss several investment and economic outlooks such as factors that determine the balance between investment spending and savings, forecasts for economic growth, and expected returns for developed and developing markets. At The Ruppert Team, we take a holistic approach to managing, building, and protecting your wealth. If you'd like to discuss this market and economic update in more detail, please get in touch with us anytime.
What lies ahead for the Canadian Economy in 2024? CIBC’s Chief Economist, Avery Shenfeld, shares his thoughts.
AMT - What's changing for 2024? The AMT system imposes a minimum level of tax on taxpayers who claim certain tax deductions, exemptions, or credits to reduce the tax that they owe to very low levels. Let’s review how the AMT system works, the proposed changes, some examples where the AMT may or may not arise, and some planning considerations.
The Alternative Minimum Tax (AMT) system imposes a minimum level of tax on taxpayers who claim certain tax deductions, exemptions or credits to reduce the tax that they owe to very low levels. Under the AMT system, there is a parallel tax calculation that allows fewer deductions, exemptions, and credits than under the regular income tax calculation. In some cases, depending on a donor’s personal tax situation, AMT could be triggered if a charitable gift is made in 2024, when it wouldn’t have been triggered had the gift been made in 2023. For example, this might be the case if a donor earns some tax preferred income (for example, dividend income or employee stock option benefits), or capital gains in the year, and also makes a charitable donation. Read our comprehensive overview here.
“Wait until next year” is the message for investors and central bankers that have been looking for signs that higher interest rates are going to bring inflation back to target. Yes, price increases have decelerated sharply, but as we anticipated a year ago, that reflects the fact that so much of the earlier spike wasn’t attributable to overheated demand. Read our full report and interest rate forecast here.
What’s next for markets and what does it mean for your investments? Our experts dig into what’s ahead, including considerations for your portfolio as economic uncertainty persists. With digital continuing to evolve we also look at the latest cybersecurity trends and how you can protect yourself in a digital world. Watch the replay here.
The debt ceiling is a limit set by the US Congress on the amount of permitted borrowing the US Department of the Treasury is approved to use to fund the gap between its tax receipts and spending. In our new commentary, How the US debt ceiling affects Canadians, Michael Sager, Executive Director, Multi-Asset & Currency at CIBC Asset Management discusses the potential impacts of the debt ceiling for Canadians and answers the following questions:
How does the debt ceiling impact markets? Will the Canadian dollar's value against the US dollar be impacted? Will the debt ceiling influence the Bank of Canada's interest rate policy? What are the potential impacts on investors and portfolio diversification?
2022 was certainly a difficult year. For only the fourth time in close to a century, both equity and bonds recorded calendar year declines (Chart 1 in report). Even during the 2007/08 Global Financial Crisis (GFC) investors didn’t face such a challenging environment. 2023 has started on a better note, but challenging economic conditions suggest heightened market volatility ahead. With this in mind, we encourage investors to focus on long-term goals when looking at their portfolios, and to avoid making short-term changes based on current market volatility. We suggest investors stay focused on their long-term goals and outcomes. Bond yields have reached levels that make fixed income an increasingly attractive proposition and equity valuations have started to reach healthier levels. If you'd like to discuss this report and our insights, call us at 905-272-6000. We have the expertise and desire to help build and protect your wealth.
