{"id":311289,"date":"2025-11-28T00:27:17","date_gmt":"2025-11-28T00:27:17","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/311289\/"},"modified":"2025-11-28T00:27:17","modified_gmt":"2025-11-28T00:27:17","slug":"five-things-we-learned-from-rbc-economist-eric-lascelles","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/311289\/","title":{"rendered":"Five things we learned from RBC economist Eric Lascelles"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

The Royal Bank of Canada\u2019s head office in Toronto\u2019s Financial District.Fred Lum\/The Globe and Mail<\/p>\n

If you look at the prices of precious metals and cryptocurrency recently, and the huge annual deficit figures coming out of Ottawa and Washington, you might think North America is headed for hyperinflation. But central banks are cutting interest rates to combat economic weakness. What\u2019s an investor to do? We asked Lascelles, chief economist at RBC Global Asset Management.<\/p>\n

1. Lascelles knows it\u2019s now kind of a clich\u00e9: \u201cHistory doesn\u2019t repeat itself, but it does rhyme.\u201d Pick a theme: speculation in railway stocks in the 19th century, tariffs imposed in the 1930s, massive government debt after the Second World War, 1970s stagflation, the 1990s tech bubble and more. \u201cYou can draw parallels on individual themes,\u201d he says.<\/p>\n

2. The trouble is that parallels can be inexact. Yes, tariffs were high in the 1930s, but trade \u201cwas a relatively small fraction of the economy,\u201d Lascelles says. Many tech companies went bust in the 1990s, but \u201ca lot of fibre was laid,\u201d he says. So is the artificial intelligence boom that now powers the Magnificent Seven U.S. tech stocks a bubble or the real thing? <\/p>\n

3. The Bank of Canada and the Federal Reserve have been cutting policy interest rates since 2024\u2014to 2.25% here and a target of 3.75% to 4% in the United States. \u201cOur forecast is 2%\u201d in Canada, Lascelles says. The Fed may have more wiggle room. \u201cThey\u2019re going into the threes. Could they touch the twos?\u201d he asks. Quite possibly.<\/p>\n

4. Does fiscal policy\u2014government spending and taxation\u2014matter anymore in an era of massive deficits? Lascelles says he\u2019s still \u201cprofoundly dubious\u201d of the argument it\u2019s irrelevant. Central banks have a lot of control over short-term interest rates, but long-term rates remain high\u2014a sign bond markets are still concerned about inflation. \u201cImplicitly, then, bond yields are pricing in some fiscal excesses,\u201d he says.<\/p>\n

5. Now is not a time for investors to be taking big swings, Lascelles says. They should be \u201cpaying particular attention to diversifying right now.\u201d Worried about high-flying tech stocks in U.S. indexes? Or gold and silver producers in Canadian ones? \u201cIn theory, a time of volatility is a time when active money managers can outperform,\u201d he says.<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: The Royal Bank of Canada\u2019s head office in Toronto\u2019s Financial District.Fred Lum\/The Globe…\n","protected":false},"author":2,"featured_media":311290,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,46,2922],"class_list":{"0":"post-311289","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-ca","10":"tag-canada","11":"tag-economy","12":"tag-noastack"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/311289","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=311289"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/311289\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/311290"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=311289"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=311289"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=311289"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}