Key Events Affecting the Mad Men in 2026

There are two significant events on the horizon for 2026 that could dramatically impact the Mad Men, with one decision possibly emerging in the near future.

1) Supreme Court Ruling on Tariffs

The Supreme Court is expected to rule on the legality of U.S. tariffs on Canada by late June. However, since the hearing was expedited, a decision may come as soon as this month or in February. While the ruling is crucial—especially regarding refund prospects—there’s a broader context here. The voting patterns and discussions will indicate what might happen if President Trump attempts to impose other tariffs, which insiders say is a possibility. Should he lose significant tariff power, we could see a positive shift in risk assets, commodities, and anything linked to global growth. I think gold prices might drop.

If the tariffs remain, it would suggest that the Supreme Court is essentially supporting President Trump’s agenda. The implications of that aren’t encouraging for global economic growth, and I predict there could be a flight of capital from the U.S. I wonder if 2026 might also see another surge in gold and precious metals.

Neither scenario seems straightforward; there’s a lot of nuance and uncertainty. Nonetheless, I lean toward the expectation that the Supreme Court will overturn the tariffs, which should benefit the Canadian dollar as we confront a second major concern.

2) USMCA

Between December 17th and 18th, the USTR indicated a desire to maintain and possibly extend the USMCA agreement, contingent upon certain changes.

This announcement might have flown under the radar given the year’s end, but it was generally a positive sign. The U.S. appears to be reinforcing its dairy interests; interestingly, most of the 1,514 comments received favored the deal.

Unfortunately, many meetings happened behind closed doors, yet feedback from senators was encouraging. Senator James Lankford noted that the USTR’s representative expressed clear support for the trilateral agreement. Reports indicated that there was no mention of withdrawing from the deal.

It’s worth noting that just because the U.S. hinted at a potential exit, igniting the sunset clause in Article 34.7 back in July, it doesn’t mean the agreement is ending. Instead, it initiates a review process for the next 10 years rather than a complete termination. The agreement will still be effective.

Each nation has a mechanism for withdrawal with six months’ notice (Article 34.6). President Trump could have activated this anytime, but hasn’t yet. Maybe he’ll decide to go for it, but it seems unlikely now.

Overall, despite the uncertainty, the concerns raised by the U.S. aren’t significant for Canada’s economy. Dairy products contribute only a small fraction, and even steel was more of a worry for Mexico. Canada essentially needs to navigate the annual review process.

On a brighter note, there’s a push among some senators for a strategy focused on a “North American fortress” that mainly aims to deter China, but could also impact other foreign goods. If this comes to fruition, it would be beneficial for Canada, keeping tariffs at bay.

As we go through this process, expect some vigorous rhetoric from President Trump, but I see that as a potential buying opportunity. By 2026’s end, we could find ourselves in a better position, suggesting that tariffs on steel, aluminum, and even timber are likely to be rolled back.

This takes a certain level of courage, but unless you’re directly involved in these industries or dairy, I think you can afford to sidestep the negotiations.

I feel there are three other factors contributing to this year’s turbulence.

1) Product

2025 was a solid year for commodities, and I foresee 2026 following suit. With interest rates decreasing and global economic growth looking stable, the only exception seems to be oil, which does have some upward momentum. This year might not be great for oil, but it could be the year it finally rebounds. U.S. production has plateaued, and the sentiment towards OPEC remains optimistic. A deficit in the oil market is still a few years off, provided OPEC maintains control. I think Canadian oil stocks reflect a rising belief in the long-term value of oil sands—not surprisingly, this level is much higher than we saw in April and other times when oil prices dipped.

2) Politics

With this favorable outlook for commodities, investing in Canada seems far more attractive than last year. The Carney administration is working on simplifying access to natural resources. While challenges persist, Stephen Guilbeault’s removal from the Cabinet hints at shifting priorities. Commodity projects take time, but looking at Canada’s political landscape, one can feel confident that either Carney’s Liberals or the Conservatives will lead. Not many places can offer such certainty.

If we look back at 2025, it seems the number of challenges increased by around 5%. That places Canada in the middle of the G10 currencies, but I think it underestimates the positive political changes over the last year.

3) Housing and Consumers

The significant risk I pointed out last year revolved around Canadian housing, which played out as expected. Toronto home prices dropped another 6% and aren’t predicted to improve in 2026. The crucial question was how consumers would respond to the wealth reduction. Surprisingly, the impact was minimal. People noticed a decline in their home equity, yet spending remained stable. A key reason for this is that relatively few Canadians capitalized on increasing housing stocks since 2018. I believe the best indicator that we’ve moved past housing anxieties will be the performance of bank stocks in 2025. It was a remarkable year for banks and the TSX, as consumer behaviors became clearer mid-year.

This year may present similar challenges as we continue to face ultra-low mortgage rates from 2021. However, there’s a glimmer of hope that’s surprisingly bright. I think one of the most surprising developments in 2025 was the resilience of Canadian consumers amid uncertainty. Demographics and baby boomer spending likely played a role, but that’s not the whole picture, and things have appeared stable. If we can hold on until mid-year, I anticipate that the Bank of Canada may start discussing interest rate hikes, and the market already seems to be factoring in about a 65% chance of a rate increase later this year.

Taking everything into account, I wouldn’t be surprised to see another 5% increase in 2026. Currently, USD/CAD sits at 1.3070, translating to CAD/USD at 76.5 cents.