Compare U.S. to Canada

People might deny it, but for most, the most important issue is money. Consequently, the number one political issue at every election for most voters is money. They might disguise it as jobs, healthcare, education, daycare, etc. But those are all money-related. If people had lots of money, they would care less about those. If they had tens of millions of dollars, they would not need a job and not worry about healthcare and education, because they can pay for the best in the world.

Therefore, the most important mandate for the country’s leader is: Has he/she improved the prosperity of voters?

Compare Canadian to U.S. stock performance, since Justin Trudeau was elected as Prime Minister. The S&P/TSX Composite index has gone up 25.1% from Oct 25, 2015 to Jan 31, 2020. Meanwhile, the U.S. S&P 500 has gone up 58.8% over the same period. (S&P/TSX closed at 13,841.90 on Oct 25, 2015 and 17,318.49 on Jan 31, 2020. S&P 500 closed at 2,030.77 on Oct 25, 2015 and 3,225.52 on Jan 31, 2020.)

Below is a graphical representation of the difference, though I was not able to get Yahoo to show the lines to Jan 31, 2020.

Here is more data to show Trudeau’s underperformance.

Canadian annual GDP growth (%) for 2016: 1.10
Canadian quarterly GDP growth (%):
2017 Q1:  0.6
2017 Q2:  1.2
2017 Q3:  0.4
2017 Q4:  0.4
2018 Q1:  0.5
2018 Q2:  0.4
2018 Q3:  0.6
2018 Q4:  0.2
2019 Q1:  0.2
2019 Q2:  0.9
2019 Q3:  0.3

U.S. annual GDP growth (%) for 2016: 1.57
U.S. quarterly GDP growth (%):
2017 Q1:  2.3
2017 Q2:  2.2
2017 Q3:  3.2
2017 Q4:  3.5
2018 Q1:  2.5
2018 Q2:  3.5
2018 Q3:  2.9
2018 Q4:  1.1
2019 Q1:  3.1
2019 Q2:  2.0
2019 Q3:  2.1

If Trudeau did not bring in 3 times more immigrants than the U.S. (on a per capita basis), Canada’s GDP growth would be even lower, probably in recession.

This is partly why I’ve allocated 100% of my portfolio to U.S. equities for many years.

Note that immigration is how most politicians try to boost GDP. However, this is not important to voters. GDP for the country does little for them. They care more about GDP-per-person, or more specifically, income. After many years of mass immigration, the average income has been relatively flat. This is because most political leaders are incapable of increasing GDP-per-person. Increasing GDP is easy. Simply increase immigration.

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