Unspontaneous Combustion
When the media is uniformly on fire, nothing is as it seems.
“When a magician lets you notice something on your own, his lie becomes impenetrable.” – Teller
In early December, we published “Alberta Clipper” to speculate on the future of Canadian politics and its potential impact on energy markets. We posited that Mark Carney, a globalist’s delight and former head of both the Bank of Canada and the Bank of England, was being positioned to replace Justin Trudeau as leader of the Liberal Party. We further predicted that Carney would receive full backing from Canada’s notoriously pliant media and pose a formidable challenge to Conservative Party leader Pierre Poilievre. At the time, the betting markets had Poilievre as the overwhelming favorite, with a greater than 90% chance of winning the next federal election, and Carney was nowhere near the leaderboard. Our interest centered on how a Carney upset might temper the fledgling separatist movement in Alberta, home to the bulk of Canada’s energy resources and one of the Conservatives' primary strongholds.
Enter the big bad wolf known as Donald Trump. Days after we published our missive, Trump began referring to Canada as America’s 51st state and downgraded Trudeau to governor. He also threatened to impose tariffs on all goods entering the US from Canada—a threat he has since made good on—throwing the economic relationship between the two countries into turmoil. Nothing roils Canadians quite like arrogance from their overbearing southern neighbor, and the country is experiencing a historic wave of unity, patriotism, and outright anger at Trump. The media frenzy is unlike anything we have observed in decades of following Canadian politics.
Almost like magic, Carney will now replace Trudeau as Prime Minister, Polymarket gives him a fighting chance of defeating Poilievre in the upcoming election, and Alberta’s liquor stores are removing American products from their shelves. There is no time for selfish talk of independence when an outside actor threatens to alter your borders by force, and Trump’s behavior has made anything short of total national solidarity decidedly uncouth. It is such a clean sweep for the elites controlling Canada that one can’t help but wonder if Trump isn’t doing their bidding.
Perhaps he is?
Thinking laterally requires a willingness to challenge assumptions, connect disparate facts in unconventional ways, and even occasionally entertain the absurd as axiomatic—all in the pursuit of a functional working model that explains current events and helps with predicting future ones. Such models need not be true, they simply need to work, and the moment a model fails, it should be discarded for a superior one. Publishing the results of such musings long before events unfold carries some risk, as evidenced by the lively response we receive when we do. It can be uncomfortable to acknowledge that practically all media frenzies are artificial, despite history’s nearly unbroken record of exposing them as such. This is especially true when you are actively experiencing one, as our Canadian friends are now.
If you are currently reading this from Europe, consider yourself warned…