Recession or rally? Mid-year investment insights and strategies with David Wong

Market volatility isn’t new, but over the past year it has intensified due to tariff tensions, unpredictable interest rates, and persistent inflation, leaving investors to navigate contradictory and confusing economic signals. This raises a critical question for investors: how can you make wise decisions when news cycles outpace policy changes and traditional indicators seem  unreliable?

In this episode of Smart Advice, host Carissa Lucreziano welcomes back David Wong, Chief Investment Officer and Head of Total Investment Solutions at CIBC Global Asset Management. With decades of experience guiding investors through economic storms, David brings clarity to a chaotic moment. He breaks down what’s really happening with Canadian and global markets, discusses the potential for recession amid tariff uncertainties, and highlights the evolving roles of fixed income, gold, and alternatives in a diversified portfolio. Additionally, David also explores the impact of artificial intelligence as a future growth driver and its potential implications for investment strategies. He emphasizes the importance of staying invested during turbulent times and offers insights into low-volatility equity strategies as a practical approach to managing risk.

This episode provides a strategic perspective on investing, offering practical insights on managing risk and refining your investment strategy amidst the noise of the headlines.

Here are three reasons why you should listen to this episode:

1. Understand how global tariff tensions and inflation are shaping Canadian markets—and what that means for your investment strategy.
2. Discover effective strategies for building a resilient, diversified portfolio that can weather short-term volatility without sacrificing long-term growth.
3. Explore the influence of artificial intelligence and alternative investments on market trends and your investment approach.

Resources

• CIBC's "Smart Advice" Podcast and Website
• Visit CAM Investment insights for timely expert insights and research 
• Visit CIBC for more Smart Advice
• Chicago Mercantile Exchange FedWatch Tool

C.D. Howe Institute’s Business Cycle Council

• McKinsey Study on AI Adoption
• Goldman Sachs Forecast on AI Impact

Episode Highlights

[00:25] Navigating 2025 with a resilient investment strategy

• Market turbulence in 2025 means Canadians need to adapt their investment strategy.
• David Wong describes the current market in one word: “challenged”.

[02:41] David: “More than anything, the uncertainty surrounding where tariffs will ultimately settle is creating challenges on planning for investments from businesses and big ticket purchases from consumers.”

• He outlines the major factors distorting traditional economic indicators—particularly tariffs—and explains how these distortions complicate policy decisions.
• As uncertainty continues to cloud the outlook, the importance of adaptable, long-term strategies becomes even more apparent.

[04:23] Impact of tariffs and interest rates on investments

• Two possible economic scenarios are in the Bank of Canada’s latest monetary policy report—one involving tariff resolution, and the other pointing toward global trade conflict.
• Interest rate expectations in the U.S. have shifted; markets are now pushing back rate cut forecasts due to persistent inflation.
• In Canada, rising unemployment and stubborn core inflation have increased the risk of recession, adding more weight to central bank decisions.
• Rather than react to every policy shift, a better investment strategy may be to build diversified portfolios that reflect multiple possible outcomes.

[09:07] Volatility and market reactions

• Market movements in April reflect just how reactive investors have become to tariff-related headlines, swinging sharply with each new development.
• David emphasizes that inflation remains a key concern—one that hasn’t been resolved post-COVID and could be exacerbated by global trade tensions.
• In times like these, staying invested and resisting panic