Wednesday, October 08, 2025

Mid-Week Post

 Your middle-of-the week apple cider …

 

But … elbows up:

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Mark Carney’s second visit to the White House as Prime Minister ended without any relief from punitive U.S. tariffs, but President Donald Trump predicted Canada and the United States would ultimately reach a deal even if some levies remain in place.

Dominic LeBlanc, the minister responsible for Canada-U.S. trade, remained behind in Washington to continue talks even as Mr. Carney heads home Wednesday morning. Mr. Carney was scheduled to dine with Vice-President JD Vance Tuesday evening.

Mr. Trump also signalled ambivalence about whether he would ultimately preserve the trilateral United States-Mexico-Canada Agreement or sign “other deals,” but praised Canada for its work reducing fentanyl trafficking across the shared border and predicted Canadians would “walk away very happy” from the negotiating table.

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Mark Carney clearly hasn’t learned one of the key rules of politics, and someone on his team should teach him soon, you need to under sell and over deliver. Doing the opposite, when you promise more than you can deliver, is a recipe for disaster.

Last week, Carney’s office leaked to CTV that they were “cautiously optimistic” about getting movement on steel and aluminum tariffs.

Carney didn’t speak to the media after leaving the White House on Tuesday, he left that up to his deputy on the cross-border file. Standing atop the roof of the Canadian Embassy in Washington with the American Capitol Building behind him, Dominic LeBlanc tried to put the best spin on things.

“We talked about the importance of reaching an agreement soon and quickly on steel, aluminum and energy matters, and with the United States, we concluded the discussion with Mr. Trump and Mr. Carney with the instruction to continue our work, and the discussions will continue,” LeBlanc said. …

That was the essence of the meeting, at least what we could see in public, two leaders complimenting each other, nothing to deliver for Canada. Had Carney and his office not raised expectations, that wouldn’t have mattered, but unfortunately for them, they haven’t learned that important rule in politics about managing expectations.

 

I think I know what might get Carney moving:

The fight over Russian interference in the 2016 American presidential election, the investigation of Donald Trump and the current retribution in Washington is being felt in the Great White North. The Trump administration is seeking out those they have accused of weaponizing the justice system against the President, and it includes a lawyer whose firm represents a major Canadian client.

 Now two of Canada’s biggest companies, Brookfield Asset Management and Scotiabank are caught in the crosshairs of the American Department of Justice.

Edward R. Martin Jr., the associate deputy attorney general in charge of the Weaponization Working Group, has written to Brookfield CEO Bruce Flatt demanding answers to several questions by Oct. 7. The questions relate to Brookfield’s due diligence surrounding their purchase of a Peruvian toll road called Rutas de Lima in 2016 from the Brazilian conglomerate, Odebrecht.

Both Brookfield and Scotiabank were asked for comment and while both firms acknowledged the request, neither has provided comment at this point.

Shortly after the sale of Rutas de Lima to Brookfield went through, Odebrecht was ordered by the DOJ to pay a $2.6 billion fine for corrupt practices spanning several years.

 

You remember Brookfield:

Things are looking up for Prime Minister Mark Carney’s former company, Brookfield Asset Management Ltd., which saw its second-quarter profits increase by close to $1 billion compared to last year.

The company boasts over USD $55 billion in assets worldwide.

Carney held $6.8 million in options with the company as of Dec. 31, which he placed into a blind trust upon winning the Liberal leadership race.

 


Oh, this isn’t good:

One of Canada’s major lenders says Prime Minister Mark Carney will push the country’s deficit to about 3% of its gross domestic product as his government pursues major projects and tries to attract more investment.

Stefane Marion, National Bank of Canada’s chief economist, said he expects Ottawa’s fiscal shortfall will reach $100 billion this fiscal year, more than double the $42 billion the government forecast in December.

 


A crash course on medieval fiefdoms:

It’s a mark of how strongly Ron Kubek feels about the political mismanagement of Canada’s wine industry that he took time out from bringing in this year’s grape harvest to vent.

The owner of the Lightning Rock winery in B.C.’s Okanagan Valley said that he can export his award-winning Pinot Noir into Washington State tariff free under the Canada-U.S.-Mexico trade agreement.

But if he wants to access Ontario’s LCBO or Quebec’s SAQ liquor stores, he is obliged to pay markups of 71 per cent and 130 per cent respectively. Lightning Rock has been ranked in the top 25 wineries in the country, but it is a small (3,500-case), relatively high-cost producer, making delicious, jammy pinots.

To match the $38 retail price for a bottle on his website, Kubek said he would need to wholesale his wine to the LCBO for $9 a bottle, even though it costs him $15 to produce.

Similar economics face any Ontario winemaker trying to break into B.C.’s provincially run liquor stores.

“I’d love for the premiers of Ontario and B.C. to pull their heads out of their butts,” said Kubek. “As a Canadian, I just think that it is so stupid that we tax our own stuff more than anyone else’s. Each province considers every other province to be another country.”

During the general election, Prime Minister Mark Carney repeatedly talked about how “we can give ourselves far more than Donald Trump can ever take away, if we have one Canadian economy, not 13.”

But, when it comes to the wine and spirits industry, the rhetoric has far outstripped the reality.

As provincial liquor boards in B.C. and Ontario pulled American wine and spirits off the shelves, provinces talked about expanding internal trade on behalf of the country’s 615 wineries. Earlier this year, nine provinces signed memoranda of understanding with the goal of allowing wineries to sell directly to consumers (DTC) in other provinces by May 2026.

Since then, there has been little evidence of an action plan. “It’s a big nothing burger,” said Kubek, who has started shipping to Ontario anyway.



When one thought that we could not get any lower:



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