Chilliwack – Bill Westmacott – 2025 proved to be a year of significant and rapid change in geopolitics, global trade, and record gains in several assets. So, let’s begin.
- President Trump shifted relations with all global trade partners by using punitive tariffs. The initial outcome was a flash crash in the stock markets in April. All major trade partners quickly negotiated new trade deals. Sadly, Canada has been the exception. Hopefully, Prime Minister Carney and his team can resolve this sooner rather than later, as it creates economic uncertainty for our Nation.
- The USA has gone to a “USA First Policy” and has taken action to prove it. The process of reshoring industry back to US soil or US-friendly Nations will be crazy expensive and take a decade or longer to achieve. The policy also includes a reenactment of the “Monroe Doctrine.” This American foreign policy was first enacted in 1823 by President Monroe to ensure the USA controlled the Western hemisphere and prevent further European influence in South and Central America. The USA is no longer worried about the Europeans, but China, Russia, Iran, and radical extremist groups/drug cartels controlling countries and the regions that are rich in resources. Expect more conflict in 2026!
- There was also a significant shift in what wars the USA was prepared to partake in. For the most part, the USA is leaving NATO and the EU to resolve the Ukraine/Russia war, as there is little desire by the two countries to end this war; in fact, it has severely escalated in 2025. The USA took strong action against the deemed terrorist groups controlled and funded by the Iranian regime. The US Air Force hit Iran’s nuclear facilities, the radical Islamic extremist group in Nigeria, and, most recently, captured Venezuelan dictator Maduro. Sadly, the world continues to shift to increased conflict and war!
- The AI boom continued in 2025. Hundreds of billions of dollars have been committed by the big AI firms (Amazon, Meta, Google, and others) to build out massive AI data centers. The electricity needed to build each facility is equivalent to powering an entire large US city. The question is, where will they get the massive amount of electricity required to power these centers? Copper is going to be needed in huge quantities, and guess where the price will go? Already Cooper is at its all-time high! Another metal that is in large deficit.
- Here in Canada, we continue to have a housing crisis (unaffordability, especially in larger cities or desirable regions), mainly created by poor government policies over the last couple of decades. The housing crisis has escalated with the Cowichan ruling in Richmond, which created a two-owner land/property ruling (Negating 150 years of Canadian property rights) and has now spread across Canada. Even Alaska is claiming mineral rights in BC! Not only has this created a massively expensive legal mess, but neither the BC government nor the Federal government has intervened to protect Canadian property rights. To say the least, this is highly concerning for property owners and will further hinder foreign investment in real estate!
- The Canadian economy continues to struggle with a lack of foreign capital, innovation, and productivity. Without extensive changes to the government policies (becoming pro-business and rapidly approving resource projects (not decades long) and pipelines), we will continue to face severely hindered economic growth. Canada already has the worst GDP in the G7. Without real change, all Canadians will continue to be impacted for the foreseeable future. Expect a lower standard of living, higher taxes, and continued massive deficits that erode our purchasing power (inflation). True to a central banker’s ideology, Mr. Carney did not disappoint with a 78 billion deficit in his first year, and I suspect the real number will be a lot higher.
- The other major trend in 2025 was social unrest expressed in many Nations. This was mainly due to the growing divide between the ultra-wealthy and the common person, or oppressive governments that were starving their populations and creating unsustainable inflation. There is also the crisis created by politicians in the EU and other Western nations who have flooded their countries with non-vetted immigrants who have no intention of assimilation into the culture. Sadly, I see this trend of protesting, riots, and conflict intensifying in 2026.
- Now onto the positive. Over the last 15 years, I have encouraged clients to purchase a sizable portion of their wealth in physical gold and silver. In 2025, I recommended platinum to clients who asked me. I, too, started accumulating platinum in 2025. For those who took action, they were not disappointed! Gold, Silver, Platinum, and Copper are all at historic record highs. I will share my 2026 forecast for these metals and other opportunities shortly.
- Physical Silver provided a return of over 150% in 2025! Gold returns 65% and Platinum about 110%! These were the market leaders in 2025, outperforming all indexes, cryptocurrencies, and AI stocks. Many precious metals mining companies had an outstanding year, with returns exceeding 100%.
So, what can we expect in 2026?
- January gives us a picture of how the year will play out (called the “January Effect” with about 80% accuracy). I do expect another year of volatility, but I still believe the year will end with positive returns (but more muted than the last 3 years of 20% S&P returns). Another major factor in 2026 will be the USA mid-term elections. President Trump will do everything in his power to keep the markets up! Jerome Powell, the head of the Fed, will be replaced this spring, and the new person will flood the markets with liquidity and lower the US dollar.
- So what drove precious metals to the moon in 2025, and what should we expect in 2026? Three words: Fundamentals, Massive Demand, and Supply Shortages in both silver and platinum. Central banks are purchasing approximately 30% of the global gold production each year(3500 tons). Silver production cannot keep up with the industrial demands (solar panel demand has reached 20% of the annual production and is expected to be 30% by 2030). Then there is the electrification revolution, high-tech demands, and the military complex. It is estimated that over the last 5 years, there has been a 900 million ounce shortfall, and there are not enough high-grade new mines coming online to offset the demand. We are seeing a growing monetary demand with Sovereign Nations adding silver to their reserves. Individuals and wealthy families in Middle Eastern nations, India, China, and Asian countries are purchasing silver as their currencies are rapidly devaluing. A few Canadians are finally waking up to this opportunity. The average person can no longer afford gold, so silver has become the go-to. I expect silver to reach over $100 US in 2026. Gold will breach $5000 US per ounce, and platinum will more than likely rise by another $1000 US per ounce. So, I am bullish on precious metals for the foreseeable future (5 to 10 years). But expect some corrections along the way, which are both healthy and normal for all asset classes. Corrections are great buying opportunities. When precious metals corrected last week, I bought more silver. Yes, it is still a good time to purchase precious metals, even though you may have missed the first third or fourth innings of the game.
- Oil prices will continue to be suppressed in the first half of the year due to a glut of production and lack of demand, unless there is a serious geopolitical event or war expansion. There may be some excellent opportunities in oil and gas producers in the second half of the year. Canada has some of the best companies in the world, so shop local.
- There are still over 1 million refinancings of mortgages in 2026. I believe it will be another tough year in real estate. There are still very high inventories in many housing markets, and selling a home is taking a lot longer than average. The exception is if you have a highly desirable property in pristine condition. I had a couple of clients like that, and their homes sold quickly, and one with a higher sale price than listed. Truthfully, Canadian real estate prices need to correct sharply to bring out new buyers.
- Most stock exchanges will appreciate with single-digit returns or slightly higher in 2026. Bonds are risky business in this type of market, unless you are a professional or understand which segment to partake in. For the average person, avoid bonds!
- If you haven’t started purchasing physical gold, silver, or platinum as a way to protect and grow your wealth, then I encourage you to do so in 2026. You can purchase gold fractionally in either ounces or grams. There are many options with silver (1, 5, 10, 100 oz bars, kilo bars, and even 1000 ounce bars for those who can afford it), and platinum is only available in one-ounce coins or bars. You can also do RRSPs and TFSAs with physical gold and silver, but it is becoming more challenging to source the metals (expect a wait if you want to purchase this way).
There will be many good options to grow and protect your wealth in 2026. Remember, risk management is critical, and having a truly diversified wealth strategy with 5 to 7 different asset classes is key.
Wishing you a healthy and prosperous 2026!
Bill Westmacott, Owner of Fivefold Financial, a life insurance broker in BC, wealth specialist, and estate planner.
