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Jameson Berkow

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Progressive Conservative Leader Doug Ford has won a majority government and will become Ontario’s next premier. BNN Bloomberg asked a few of Ontario’s top money managers and economic minds what affect Ford’s PC government could have on markets and the economy. Here’s what they had to say.

RISHI SONDHI - ECONOMIST, TD ECONOMICS 

"One of the first orders of business by the Ford government will likely be an audit of Ontario's books. We urge the government to move promptly on this plan. If history is any guide, this process could reveal a significantly higher deficit (and debt) than previously reported, increasing the fiscal challenges faced by the new government while also potentially providing ammunition to justify future spending cuts. The government should also focus on delivering a budget as soon as possible."

SAL GUATIERI  –  ECONOMIST, BMO CAPITAL MARKETS 

“Ford’s pledge to cut the Ontario corporate income tax rate by one percentage point to 10.5 per cent would give the province’s businesses the lowest taxes in the country, and largely neutralize the tax advantage that had recently favoured U.S. companies. This will come in handy if Trump lays a tariff on the auto industry.”

ALLAN SMALL – SENIOR INVESTMENT ADVISOR, ALLAN SMALL FINANCIAL GROUP, HOLLISWEALTH

“I think all of this is a little bit of noise in my opinion. I think a lot of people voted with respect to the tax situation. PCs were offering a cut in taxes in many instances. I think the NDP and Liberal – especially the NDP perhaps –  [planned on] increasing in taxes. I know talking to a lot of clients that was a big point of contention for many voters … Obviously voters really wanted a change.”

ROYCE MENDES AND KATHERINE JUDGE - ECONOMISTS, CIBC CAPITAL MARKETS 

“So far, we don’t know all of the details regarding the balance of spending and revenue and what the implications are for Ontario’s deficit and debt load. Ford has said that he’d like to look at the province’s books before setting the numbers. But, what we do know is that Ontarians have clearly voted for change.”

BARRY SCHWARTZ – CHIEF INVESTMENT OFFICER, BASKIN WEALTH MANAGEMENT

“I don’t think there will be any reaction to a Ford majority or minority. I am hopeful that common sense will prevail and the winning party will recognize that it must do everything it can to keep Ontario competitive. As a business owner, I would love to see incentives for hiring new employees, incentives for capital expenditures and a fair tax plan that encourages me to invest.”

NORMAN LEVINE – MANAGING DIRECTOR, PORTFOLIO MANAGEMENT CORPORATION

“I think the main beneficiary of a Ford victory will be Ontario bonds. I think the spread over Canada’s will narrow some. Also, the loonie may form a bit. I don’t think stocks will be affected much. They are more concerned about [the North American Free Trade Agreement].

PATRICK HORAN – PORTFOLIO MANAGER AND PRINCIPAL, AGILITH CAPITAL

“If the PCs win a majority then not too much [impact] on the equity side – I don’t think most companies have too much political Ontario risk discount in their share prices.  Therefore no relief rally. Likely more of a positive reaction in the credit spreads of Ontario government paper – anticipating improvement in spending deficits going forward.”