- In today’s CEO Daily: Diane Brady on Mark Carney—financier, central banker, and Canada’s new prime minister.
- The big story: Trump won’t rule out recession.
- The markets: Terrible.
- Analyst notes from Convera on the “hard reset” theory, UBS on U.S. trade policy, Apollo on the VIX, Wedbush on Tesla, and EY on the labor market.
- Plus: All the news and watercooler chat from Fortune.
Good morning. After winning the race to replace Justin Trudeau as Liberal leader yesterday, Mark Carney will become Canada’s next prime minister. The length of his tenure will depend on whether he wins the next federal election, which must take place before October 20, but his first task is to end America’s trade war against its largest export market. Here’s what CEOs can expect:
Economic savvy: A former Goldman Sachs executive who served as governor of both the Bank of Canada and the Bank of England, Carney was praised for his leadership through the 2008 financial crisis and Brexit. He went on to become UN Special Envoy on Climate Action and Finance, and an advisor to government and business leaders. Calling himself a pragmatist, he vowed last night to do away with an unpopular carbon tax and capital gains hike.
A political novice: Carney has never held elected office and quickly learned that smart business decisions can be politically dumb. Exhibit A: Chairing the board of Brookfield Asset Management when it shifted headquarters from Toronto to New York to chase more investors and inclusion in key indices. While Canadians cheer success south of the border, Donald Trump’s attacks have made such moves feel like a betrayal.
A focus on growth: Carney has promised to focus on taxes, productivity, and other levers of economic growth. I’ve spoken with several Canadian CEOs who want to see more alignment with rational U.S. policies, which would preclude 25% tariffs. As RBC CEO Dave McKay told me a few months ago: “We need a strong America that’s in an expansionary global mode and protects democracy and stands up for the rules of democracy.”
In the meantime, Canadians need a leader who can repair trade ties right away. Carney says Canada’s economy is stronger than the U.S. economy “in the medium term.” Others would not agree as Canadians have had to deal with more household debt, a higher unemployment rate and slower economic growth. Starting today, Ontario Premier Doug Ford plans to charge 25% more for electricity shipped to U.S. customers. There’s more to come. “Canada will never, ever be part of America in any shape or form,” said Carney. “As in hockey, Canada will win, but victory won’t be easy.” Stopping a trade war, though, will require a shared win.
More news below.
Contact CEO Daily via Diane Brady at diane.brady@fortune.com
