Everyone wants to talk about specific policies, but it's really what's gonna happen to the
economy.
Lionel: Hello everybody.
My name is Lionel Johnston, and I'm sitting here with Bison's
Chief Financial Officer Damiano.
So, welcome, Damiano.
Thanks for sitting down with me today.
Damiano: No problem.
Lionel: Thank you.
We're going to sit down and take a couple minutes today actually to talk a little bit
about the economic conditions in Canada and the U.S., and also talk about the, we'll call
it the Trump effect on trucking.
And we can really dive into that a little bit.
That sounds fair for you?
Damiano: Sounds good.
Lionel: Great.
Okay, well I just wanted to kick things off with our first topic really moving into the
economic conditions and the election.
I was actually in Boston during the U.S. election.
So it's pretty interesting being a Canadian, be able to see this huge American event which
has ramifications inside and outside of the U.S. clearly.
I just wanted to talk a little bit about what you think would be the effect of Trump and
his leadership and some of his platforms on the transportation and trucking industry specifically?
Damiano: Okay, Lionel.
Thanks for inviting me to speak on this.
No one has I'll say absolute the answer to what is gonna happen in the future, but there's
probably a lot of developments that is informing us as to what we anticipate is gonna happen
in the future.
And one of the things that I would highlight in this past year is especially for the folks
in our business that have worked through this last cycle.
We know that the markets have been soft.
And when we talk about soft, what we're generally talking about is retail and consumer.
The consumer activity in the West.
And if we can appreciate what has happened is that we've gone through an energy slowdown
story.
That's really what happened.
And that had a, I'll call it a profound effect out West.
It had even an effect I'll say to Manitoba and further East because the energy, I'll
call it the energy economy actually touched many facets of the Canadian industries.
Now, when you look down South to our neighbor, there was I'll say even back at the start
of 2006, a lot of expectation on the U.S. economy starting to continue to strengthen
as we go through the cycle with housing up and a lot of optimism.
As we went through the cycle, what we actually found is the U.S. was sluggish as well.
So, the surprising part of that was a lot of indicators suggest the U.S. was ready to
ramp up in terms of consumerism and investment in the corporate sector.
But what we actually saw was underperformance, and again the U.S. economy actually grew at
all stages sub 2%.
But when you consider that in relative to Canada and the other industrialized countries,
it actually performed very well, which means that the entire global economy was pretty
sluggish.
Why?
I think actually the energy story extended out beyond just Canada and a few select countries
that extend into the U.S. as well.
A lot of what we've seen up to the run-up of the U.S. election was uncertainty.
Definitely uncertainty in Canada but even in the US, in the mind of the consumer, in
the mind of business.
What has happened as we came out of that election and I'm not gonna say Trump specifically,
but in general, there's been more clarity and the clarity is around leadership.
And when I say leadership, it's the first time in the U.S. in probably 16 years, that
you actually have a presidency as well as the U.S. government, the House and Congress,
united under one agenda.
The Republican agenda.
And I often hearken back to the last time that really occurred was back in the Reagan
years.
You had an economy that was very slow and actually in a recession, and you had someone
who came on the scene that said things have to be done differently.
And what we're finding Trump's oversized personality and his way of approaching politics, what
you're finding is that he's articulating things that a lot of people have talked about is,
how do we generate jobs?
How do we create economic growth that actually benefits the middle class?
We have a government in Canada who I'll say is on a different side of the political spectrum
but also is talking a lot about how do you stimulate growth?
How do we get jobs generated in Canada?
How do we generate economic activity?
By the way, both of them are almost saying the same thing, different sides of the political
spectrum.
So, when you ask the question about the Trump effect, my answer about the Trump effect is
really what our government's doing in North America to effectively start to create a catalyst
for growth and get the economy growing again.
And what I'm seeing and what you're now seeing is the equity markets recognizing that.
The equity markets have from the U.S. election in early November to now, have run up over
7% to 9%
That's a dramatic run-up, and the markets have gotten ahead of themselves.
What the signals are saying is, they believe that there is gonna be stimulation.
So in Canada, the stimulation is coming via infrastructure programs, specific investment
in certain job-generating initiatives.
In the U.S., you hear Trump talking about... that he wants to significantly leverage the
infrastructure spending to renew roads, railroads and all of the, call it transport infrastructure.
Which is actually when you look at our company and look at our industry is very important.
Very important in terms of not only improving the infrastructure inefficiencies but also
highlighting the fact that trucking and all modes of transport are very important to increase
productivity and create jobs in North America.
So, I think that's the overriding theme here.
And what that means is that a lot of analysts and a lot of economists are predicting that
actually GDP will start to not only start increasing but will see a mini acceleration
here into the back half of '17 into '18.
It's because of the government intervention and spending.
What that means also is that, what we're seeing is, there's a confidence now rising in corporate
U.S. and corporate America, and corporate Canada.
And in those avenues what the bet is, is that those companies will start investing.
And they're investing because they see a better outlook on demand.
I can tell you here at Bison, we've never...we didn't have to wait for government to announce
that they're reducing taxes or that they're spending more to generate economic activity.
We've always invested in our business, and we continue to invest.
So, we have that confidence because we're looking at it, not quarter by quarter, we're
looking at it over multiple years.
So again, back to what that means for our business.
What that means for transport with Trump in the office.
I think what it means is that the economy is already starting to pick up, Trump's recognized
that the demand and also the economic activity has to benefit all people.
Because ultimately, that's really the individuals that are currently saying, "What about me?"
And what does that mean in the transport industry?
Well, I'll say that transport, one of the major industries in North America, has jobs,
requires more jobs and in fact, benefits on the front end of any economic growth or development
and I see that for our business.
Specifically, about other Trump policies, I don't know if you're gonna get into that
but like immigration, things like NAFTA.
Those are structural and important but in terms of how that impacts economic development,
I would say Trump and the administration and the Republican Party would look at those things
as policies that would be implemented over time, but not to "Trump economics."
So, the number one priority will be creating jobs generating economic growth because ultimately
I think that's why Trump thinks that he was able to win the presidency.
Lionel: Great, well thank you very much for the summary.
It's quite detailed and especially at the end when you're speaking about NAFTA and immigration.
Because from an individual perspective or say if someone's a professional Driver, they
may hear something like that and directly relate that to some type of risk.
And of course there's always risks, and there are opportunities in the economy and in business,
but that's a great perspective to look at it from the macro level and then focus on
the economic level more so than the individual policy.
So, thanks for your insight there.
Okay, well thank you, Damiano, again for sharing your comments on the Trump effect in trucking,
and I found it very insightful to go look at it from the economic perspective more so
than just really drilling down into individual policies or platforms such as immigration
and NAFTA being changed and so on.
So, thank you again for you for sharing your comments there.
And for everyone watching us today, we appreciate your time to learn more about Bison and to
hear directly from Damiano about what Bison is thinking, and where we see the economy
and opportunity moving in the years to come.
Also if you could share your comments below, we'd love to hear what you think the Trump
effect on trucking will be and we'll look forward to responding to all of your comments.
And if you have any future ideas for videos like this, that you'd like us to be able to
tackle, please leave those in the comments sections below.
Thanks again for tuning into Bison and have a great day!
And thank you Damiano.