Canada and the United States have historically walked similar economic paths. The coming years, though, may see them take quite different journeys.
Investors should keep this in mind when planning their portfolios. We often hear that Canadian stocks are far cheaper than U.S. ones. That is true if you focus only on price-to-earnings ratios. Canadian stocks trade for about 12 times their expected earnings in 2024 compared to 18 times for their U.S. counterparts.
However, simple comparisons like this ignore the different trajectories of the two economies.
Canada is grappling with massive household debt, a metastasizing housing crisis and stagnant living standards.
The U.S. seems in considerably better shape. Granted, its yawning federal deficit remains a worry; so too is its poisonous politics. Despite all that, however, the U.S. economy retains a robust capacity to grow its output per…
