With all that's going on worldwide, but more specifically what's going on between Canada and the USA in terms of trade, tariffs and such like, it's perhaps not surprising that foreign investors might be a bit leery of putting more money into Canadian securities at the moment. The speed and scale of what's happening, though, is shocking.
In the first half of 2025, $22.6 billion has flowed out of Canadian stocks and bonds, according to Statistics Canada, reversing a trend of positive flows going back decades. Over the last 20 years or so, about $100 billion a year has poured into Canadian financial markets on average, so this is a huge turnaround, as the graph below shows.
What's doubly annoying is that all this is happening through no fault of our own. It's purely a function of what one man south of the border is doing (and doing TO us).
But how does this square with the ever increasing stock market valuations across the world, including here in Canada? I don't really know, except to assume that it is Canadians that are propping up our own financial markets, by making record investments, regardless of all the doom and gloom around us.
Now, this is probably not Canadian investors, with elbows up, supporting our beleaguered country when it needs it most. Players on the stock exchanges are rarely guided by such philanthropic motives; it's all about making money, and ethics typically do not get in the way of that. So, Canadian investors presumably see some profit to be had somewhere in the uncertain future. Interesting.
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