True Patriot Love - Canada’s Norway Fund Gamble： Wealth or Boondoggle？

00:00:00.000 When countries strike oil, most treat it like a payday, spend it, grow fast, and deal with the

00:00:05.700 consequences later. But Norway did something radically different. Instead of spending its

00:00:10.580 oil wealth, Norway built one of the most powerful financial machines in history,

00:00:15.160 the Government Pension Fund, turning a temporary resource into permanent national wealth.

00:00:20.560 No boom and bust, no political free-for-all, just discipline, rules, and long-term thinking.

00:00:26.520 So how did they actually build it?

00:00:28.660 Well, let's walk through the timeline from the moment oil was discovered in the North Sea

00:00:32.640 to the creation of a trillion-dollar fund that now owns a piece of nearly every major company on Earth.

00:00:39.360 In 1969, oil is discovered in the North Sea, and suddenly Norway is sitting on something massive.

00:00:45.200 But instead of rushing, they slow down.

00:00:48.460 In the 1970s, Norway makes a critical decision.

00:00:52.160 The oil belongs to the people.

00:00:54.000 They build a state-controlled energy sector and start thinking long-term.

00:00:58.660 And by the 1980s, oil money is flowing.

00:01:01.480 And the temptation, of course, is to spend it and grow fast.

00:01:04.500 But policymakers are already worried about overheating the economy.

00:01:08.700 And so by 1990, this is the turning point.

00:01:12.320 Norway creates what becomes the government pension fund, not to spend, but to save.

00:01:17.480 And in 1996, the first real money goes into the fund.

00:01:21.240 From here on out, oil revenues don't go straight into the economy, they go into the fund.

00:01:26.720 And into the 2000s, the fund goes global.

00:01:29.780 Stocks, bonds, real estate.

00:01:31.580 Norway quietly becomes a shareholder in the world.

00:01:36.000 By 2010, strict rules are locked in.

00:01:38.140 Only a small percentage can be used each year and the rest protected for future generations.

00:01:42.740 Today, that fund is now worth over a trillion dollars.

00:01:46.460 owning pieces of thousands of companies worldwide all built from oil on money they refused to spend

00:01:53.580 and that's the key Norway didn't just find oil they built a system to outlast it

00:01:59.360 I'm Mike joined by Paul Micucci Paul thanks for talking to me about this

00:02:06.880 oh yeah definitely Mike this is this is on my mind every day yeah I've noticed this we've had

00:02:11.860 A lot of conversations about it.

00:02:13.180 In fact, we had a conversation on a podcast recently about it.

00:02:16.820 Let's have a look at that.

00:02:18.260 What occurs to me is that the risk analysis has not included we might have a rainy day.

00:02:24.860 We might have a problem politically in the world.

00:02:28.340 We don't have any means of fortifying ourselves because we don't have any production,

00:02:33.140 because we don't manufacture, because we don't have an export product that makes a huge amount of money,

00:02:38.100 because we don't tap our resources.

00:02:40.300 Because we sold PetroCanada?

00:02:42.120 Yeah, there's a trillion dollars potentially right there.

00:02:45.140 Yeah, because we sold a company that actually drilled and refined our major resource.

00:02:54.580 Yeah, and made it possible for us to have gas at an incredible price and still make money?

00:02:59.420 Yeah, no, we don't do that anymore.

00:03:00.740 So in light of that, we don't have the rainy day fund that Norway has.

00:03:06.500 imagine we had a trillion dollars right now spending power in the world we could give a rebate

00:03:11.540 okay so there you go paul it was your idea yeah now we're going to find out today well i talked

00:03:20.100 about this quite a bit remember a few weeks ago when we brought it up and we were doing shows on

00:03:25.100 oil and of course the the increase the the significant increase in oil prices you know i

00:03:31.180 i had in my pocket when i was coming in i filled up my truck coming in and it cost me 200 to

00:03:36.700 hollerson gas which is about 50 more for to fill up a tank of gas and i knew that was going to

00:03:43.020 happen when all this started to take off and the question in my mind right away is what happened

00:03:50.940 to petro canada and i told the story on the show and and i won't get into it in depth here but as

00:03:57.100 a young man i worked for petro canada and i worked in the marketing department of petro canada so i

00:04:02.780 got to observe petro canada when it was owned by the government yep it was run by the government

00:04:08.940 and it was highly profitable and then 1990 came around the conservatives came in which we're going

00:04:16.300 to talk about that in a minute because pierre paulia was acting like he had nothing to do with

00:04:20.140 where we're at now which i kind of laughed because that's a conservative party issue

00:04:23.420 that was co-joined by the Liberals, by Chrétien, after Kim Cannibal.

00:04:29.440 But they got rid of Petro-Canada, but Norway at the time didn't.

00:04:34.960 And I remember this because I used to go to these presentations as a young man

00:04:38.500 at North York Civic Centre where the head office of Petro-Canada was located in Toronto, in North York.

00:04:45.640 And I used to go to these meetings, and they used to always refer to Norway.

00:04:50.120 So fast forward, you know, Mark Carney gets up, our prime minister gets up,

00:04:54.140 and he says, we want to do a fund, a wealth fund like they have in Norway.

00:05:00.400 And here we are today.

00:05:02.280 And indeed, we are faced with what has been compared now to a pension fund

00:05:08.500 that is so wildly successful in Norway that when our prime minister visited there,

00:05:14.200 he must have been impressed by it because he came home with the notion

00:05:17.840 that we should have our own uh i guess national fund that would be similar to what norway did

00:05:26.240 yeah well they brag about it right there of course it's it's uh trillions of dollars it's

00:05:31.360 done magnificent for the country but what he fails to and this is what on the show so this

00:05:36.560 is when i came up when i came up with an idea of canada having its own fund it really wasn't this

00:05:44.020 idea and i know you know whether they listen or not uh i hope they watch our shows i hope they

00:05:49.620 listen to what we say but where was going when we were doing those shows i was trying to highlight

00:05:55.060 where canada veered off path from where norway was and how a small country like norway has become

00:06:01.380 so bloody wealthy from taking a different policy direction in 1990 than we did because remember

00:06:10.500 this is the interesting part. Norway only found its first oil reserves and started really actively

00:06:17.980 drilling for oil in 1969 offshore in the North Sea. That's right. Right. So 1969, they said,

00:06:25.680 Eureka, we found oil. Same time, if Canadians remember, 1973 was the Yom Kippur War where the

00:06:32.660 embargoes happened, that we woke up and we said, oh, do you think we're in trouble? Right. Because

00:06:38.860 the same oil price increase that we're going through now the same uh 200 now back then in

00:06:45.400 1973 it was probably 50 but guys were filling up their truck and the government was saying this is

00:06:50.620 crazy we're we're at the will of uh a middle eastern country in those days opec right we're

00:06:58.620 at the will of these people to put up prices at any time we better do something and then they

00:07:03.360 created petro canada right they get going norway says wow we got to really pay attention to this

00:07:10.320 so we better doing do something so norway takes off their parliament which is interesting in 1990

00:07:17.760 gets together and they sit down the newegian parliament sit down and they say you know what

00:07:23.440 we're going to create a fund and we're going to create a wealth fund but they called it the

00:07:29.200 the petroleum fund. That was the initial name of it. But over time, they politically changed it

00:07:36.380 to create a pension fund, which I'm going to talk about later, which was also smart because they

00:07:41.440 wanted citizens to realize that their reserves were actually taking care of them from a pension

00:07:47.040 perspective in government. Okay. Well, let me ask you, let's begin from the begin, if we may.

00:07:51.640 Sure. So let me ask you, when Norway created this fund, what problem were they trying to

00:07:59.180 solve was it a problem at the moment that they were trying to solve they were they were trying

00:08:03.660 to fall uh solve a couple problems number one they were trying to solve the problem of making

00:08:11.420 sure that they got returns from a finite resource so they understood right away that oil was a

00:08:18.300 wonderful resource to have in their country to have offshore but it was finite right so they

00:08:24.540 one day it potentially could run out it was in the north sea they didn't know how much of it they had

00:08:29.900 they had seen what reserves had done before so they decided that what they were going to do

00:08:35.260 is they were going to take the money they made from oil and reinvest it so that was one of the

00:08:40.460 policy decisions when they passed the legislation one of the other things they decided was the

00:08:46.780 challenge with having a resource that creates so much wealth that it overheats your economy

00:08:52.460 it actually stimulates your economy too much because once you get that oil coming from that

00:08:57.820 government subsidization it could potentially cause a high level of inflation right so they

00:09:02.940 said listen we're going to put uh spending caps and uh we're going to restrict spending at home

00:09:10.860 and force as much of the money abroad to globally reinvest now i'm going to give you some numbers

00:09:17.180 because this is going to knock you off your seat right so and i'm going to take you through whoever

00:09:22.300 everyone is in this picture because it's very interesting. So this fund is about the fund that

00:09:28.200 they've amassed. When I talk about the pension fund, this is basically it's owned by the Norwegian

00:09:36.120 government, but they have a manager of the fund, an investment manager or operator, Nords Bank,

00:09:45.680 and it is the investment manager for the fund. So they're independent. They're the same,

00:09:50.080 but they're independent. The government owns it. And the purpose is to invest the oil and gas

00:09:55.220 revenues. So they have a, they have a very definitive, uh, objective for this fund.

00:10:02.200 Now Norge, right. Um, NBIM, as they call them go out and they globally reinvest this money.

00:10:12.560 So now when I, this is $2 trillion sitting in this fund now. So think about it since

00:10:19.460 1990 when they made the strategic decision so first of all this fund starts up in 1990 let's

00:10:26.160 go back a minute they say okay we want to take this money we were making we're getting from oil

00:10:31.440 we want to invest it it doesn't happen right away so i think that's something you know we

00:10:39.060 got to talk about because in canada we're talking about doing something totally different with our

00:10:44.280 wealth fund. Well, that's the truth, right? Norway started with an investment of profits from the

00:10:51.700 oil. Right. It was about 250 million Canadian dollars. They invested six years after they

00:10:59.440 started really, really getting into drilling and selling. And so they had to make money. So they

00:11:08.680 had to put some startup capital into this company, Equinor, get it going. And then Equinor started

00:11:15.760 making profits, became a hugely, unbelievably profitable company, which I'll take you through

00:11:23.180 in a minute. And then they started taking that money, putting into the investment fund. And then

00:11:28.800 today they have 7,000, let's say they have around 9,000 total global companies that they've invested

00:11:38.320 in that are paying back uh dividends interest profits back to the fund that's sustained so

00:11:45.040 again when we go back to the initial principles of this fund it was to take the oil money invest

00:11:50.240 it abroad make money back because oil is finite right made sense they they realized that right

00:11:55.840 away the other thing they did was that they they declared that the oil discovery was owned by the

00:12:04.000 country that it was it belonged to the people of norway yeah it was they established that right

00:12:09.840 away yeah it was a resource right yeah and they had to build pipelines they had to do shipping

00:12:15.120 they had to do all these things so we as canadians love to do this uh crazy thing of granting and

00:12:21.920 transferring money to companies and subsidizing companies without ownership stake it's a ridiculous

00:12:27.520 concept we've done it for years we have to stop it doesn't sustain but we do it we we have done

00:12:32.960 it right there's tons of examples in canada where we take public monies we put them into companies

00:12:38.720 never got a return never had an ownership stake and it goes on and on an ev company comes to mind

00:12:45.360 at the moment on that note but yes yeah lots of those so but you know you look at it now and so

00:12:51.280 now they're up and running they have this company working and they're so big right now which is

00:12:57.920 interesting when i dug into it they can globally change the tech industry almost overnight so

00:13:04.880 whether it's nvidia whether it's apple whether it's amazon their investments in those companies

00:13:09.520 are critical because this fund is so profitable this two trillion dollars is constantly being

00:13:14.720 churned and reinvested and last year i looked at the last year's results they had a 15 return on

00:13:21.120 a two trillion dollar fund so this has become like a it's just like a ball rolling down the hill

00:13:25.920 You think about a large round ball just getting momentum.

00:13:30.200 This has momentum.

00:13:31.620 By the policy decision in 1990, they now have investment momentum

00:13:36.160 that will take care of that country for 100 years.

00:13:40.940 So, okay.

00:13:42.260 Yes.

00:13:42.960 Norway started with oil money.

00:13:45.000 Yes.

00:13:45.520 Canada is talking about capitalizing this fund.

00:13:50.180 It's much different, right?

00:13:52.240 So we're talking about a different concept for a number of different reasons.

00:13:55.920 right and um we're talking about taking public monies putting it into a fund so we're talking

00:14:03.120 about taking 25 billion dollars putting it into a fund and then trying to attract other people to

00:14:08.960 invest in the fund and then having fund managers go find projects they want to invest in in canada

00:14:16.240 now so there's some reasons for this it's it's and this is what uh the prime minister

00:14:22.000 didn't really articulate because quite frankly, it's a liberal issue. And I don't think we

00:14:27.780 want to talk about or he, his PR people, which I said, let's not go close to this issue.

00:14:33.460 One of the main issues that we want to do this, and it's something we talk about on

00:14:37.080 almost every show. I'm sorry we do is productivity. Our productivity is so low. And one of the

00:14:44.180 reasons productivity in Canada is so low because people won't reinvest capital into the country.

00:14:50.140 Therefore, our productivity, our machinery, innovation, robotics, technology is not advanced

00:14:56.260 enough because the reinvestment into the country isn't as high as it should be.

00:15:00.580 Whether it be in mining, manufacturing, auto, it doesn't even match even close to other

00:15:07.200 developed nations.

00:15:08.080 So we're at the bottom of the 32 developed nations list.

00:15:11.600 So one of the reasons, which I do commend the prime minister on finally doing something 0.87

00:15:16.540 to get this off the ground, but it, it isn't at all like what they do in Norway. So I just want 0.98

00:15:23.560 to make sure everyone is kind of, yeah. I'm glad that we're making this comparison, Paul,

00:15:27.360 because it seems completely different. It is completely different. And it has

00:15:32.020 some interesting policy decisions that he's going to have to make along the way,

00:15:36.540 because the owner of this fund is owned by the Canadian public. So much like Norway. So the,

00:15:43.080 You know, Norway, who actually took their oil revenues, put it into a fund and created a self-sustaining company, you know, and got Equinor off the ground.

00:15:54.440 And Equinor, you know, Equinor last year did $100 billion in revenues, and it basically had an EBITDA of $37 billion, a free cash flow of $37 billion.

00:16:06.180 That money keeps getting reinvested.

00:16:08.440 reinvest it. So they made a policy decision in Norway that only 3% of the monies that come back

00:16:16.000 into the fund for the fund manager can be used by government and for budget shortfalls.

00:16:21.700 So any deficit, the most they can ever use is 3% of the fund. Right. Right. So that's a strategic

00:16:28.140 decision to not allow governments on a four year cycle to dip in and also use them for election

00:16:36.080 favors to smooth the bumps in the economy and make a government look better than it

00:16:43.600 should based on its performance. And they were very active and very smart in that policy decision

00:16:50.400 to do that. So now we're taking $25 billion in Canada, we're putting it into a fund,

00:16:56.480 and we're going to try to figure out the policies to make that fund grow.

00:17:01.480 Well, the Norway Pension Fund, as you point out, invests globally.

00:17:09.520 Here's a major difference right there compared to the Canadian one that you point out.

00:17:16.500 This fund that the Prime Minister is talking about is going to be capitalized,

00:17:20.420 and then if it attracts more investment, that investment is only going to stay in Canada.

00:17:25.660 Norway reaches out to create an actual investment fund that makes money for itself, doesn't just support projects.

00:17:36.840 And that, I think, is significant, worth talking about.

00:17:40.100 Oh, yeah, yeah.

00:17:40.760 Well, it's a huge difference, like massive difference, because our fund is internal-based.

00:17:46.020 Their fund is external-based.

00:17:47.460 So if you look at the difference, we are for creating domestic productivity and capacity within the country to get to our resources.

00:17:55.000 Right. Norway's already done that. Right. And they made the strategic decision to go abroad and reinvest.

00:18:01.100 So, you know, when we did the show on oil, I don't think there was a country or a continent around the world that Norway didn't have an interest in from a resource perspective and from a oil development perspective, wind development, solar development, and also an investment base.

00:18:17.600 So they were in every country around the world, every continent. Canada's not. Right. We didn't take that same strategic decision.

00:18:24.660 So we're we're in a different we're in a different set of we have a different set of challenges right now.

00:18:30.480 We're trying to get to our resources with some funding to try to pull them out of the ground, get our productivity higher to do that.

00:18:38.940 And we're trying to get people to follow the initial.

00:18:41.740 So look at look at the government money we're talking about, the twenty five billion is seed money.

00:18:47.360 So I look at it basically is it's seed money.

00:18:50.240 it comes from our own public trust and you know he called it canada's strong fund yeah which i

00:18:57.240 think is a right idea you know it's it's a capital injection seed funding that goes in and hopefully

00:19:03.540 you'll get returns for the people now the challenge with this is a little different right because

00:19:08.460 now um in norway you have an oil inflow profitability in their fund right right so

00:19:17.460 it's a pretty much guaranteed every year they're going to be able to top the fund up look at it's

00:19:22.660 interesting we just put out our uh fiscal update this week and we're we're saying that we're below

00:19:29.960 our deficit is lower by about 11 billion dollars than we thought it would be we thought it came in

00:19:35.200 at 61 billion we thought it would be somewhere around 72 billion that's right so it's lower by

00:19:40.420 11 billion it's lower by 11 billion because the price per barrel of oil is higher right right

00:19:46.420 so in norway's case oil was the catalyst and kind of the insurance they had to get this fund going

00:19:55.120 so they could reinvest makes perfect sense in canada we don't we're taking our own public

00:20:02.440 money so tax money fees everything government collects we're taking that 25 billion and we're

00:20:09.880 basically putting it into a fund hoping people will follow us into the fund set a really key

00:20:16.220 challenges now, given the structure of it, is we're going to have to make policy decisions

00:20:22.080 as a government that invests in projects that have an ROI, which quite frankly, Mike, this is 0.53

00:20:29.820 an interesting discussion because Chrystia Freeland stood up in the House and had a long

00:20:36.860 discussion got booed um in i think it was her 2023 uh budget got booed for saying that we had

00:20:47.520 to set benchmarks for return on investment to get productivity going she was right she was right on

00:20:54.820 that topic yeah well how does a fund work in your mind paul if it's not generating profit i mean

00:21:01.800 okay we're going to invest in this project or that project or yeah i don't understand how that return

00:21:08.440 is not like you say we have never we've never taken a return on anything we've subsidized in

00:21:14.820 this country ever so now this you're right this is a whole new set of policies for our government

00:21:20.100 to develop that says we'll invest in this project but it has to have return on investment we agreed

00:21:25.840 Now, that was, you know, and that was the number one, I guess, the critic of the criticism of the Conservative Party.

00:21:35.140 Their number one point was that this was going to be a boondoggle of cash that went out the door.

00:21:42.140 So now if I'm sitting in the prime minister's seat, I would like Norway come up with a set of principles and policies and a board bylaws for this company that didn't allow them to invest in projects that didn't have an ROI.

00:22:00.000 So I would counter his argument, and then I would go back and I would politely actually respond to Mr. Paliyev, and I'd say to him, by the way, it was the Conservative Party that sold off Petro-Canada and made the policy decision that was contrary to what Norway did and put us in the decision where we don't have a wealth fund of $2 trillion.

00:22:24.800 The only wealth fund we have is in Alberta, because in Canada, unlike in Norway, we allow provinces and the feds to jointly agree on resource decisions, whereas in Norway, it's a total federal issue.

00:22:44.040 It's a national issue, right?

00:22:45.600 So he made the criticism that this was going to be a boondoggle.

00:22:49.220 it wouldn't have been a boondoggle if we would have made the decisions back in the 80s and 90s

00:22:56.560 to keep petro canada reinvest the money globally and create a wealth fund believe it or not our

00:23:03.000 wealthiest wealth fund in canada right now uh aside from cpp on a province basis is in alberta

00:23:10.740 and it only holds 25 billion dollars and it's dwindling now because well it's probably getting

00:23:17.700 little better with the price of oil but prior to this iran war which i don't know can you uh plan

00:23:25.300 or forecast the war you you can't but if we were on the same trajectory if you remember we did a

00:23:31.300 show where the premier of alberta was standing up and saying hey this is going to be the first year

00:23:38.900 that they're not going to be able to do transfer payments to the government because the price of

00:23:43.540 a barrel had bottomed out so badly exactly and so and she was going to be dipping into her wealth

00:23:49.060 fund to use some of it to keep the services for the citizens of alberta and then also in the iran

00:23:54.980 war happens the revenue spikes and uh you know for them it's actually a better scenario at this point

00:24:02.020 paul let me ask you this at what point did this stop in norway stop being an oil and and the

00:24:07.060 reason i ask this is because if we're capitalizing something for the purpose of investing in projects

00:24:12.580 yes within our own country let me ask you this at what point in norway did this stop being an oil

00:24:17.620 fund and just start being a global investment fund oh wow in the 90s so when they made that

00:24:23.540 strategic decision when we went an opposite took opposite pathways but you know the structure of

00:24:30.020 it so when you hit on it mike you know and i i really wanted to to make sure the our viewers

00:24:35.940 and you know we're going to put it down below is understanding the structure and the importance of

00:24:40.900 the policy decision to structure this is so key and the brilliance of the government at that time

00:24:46.660 to identify it and put those policies in place it feels constitutional it was yeah well they did they

00:24:52.340 did it legislatively and you know going and setting up setting up an investment bank that took the

00:24:59.220 monies out of the government purview so saying okay this money is going to be swept so we're not

00:25:05.620 only going to fund this oil company which was uh in stat oil when it started it became equinor

00:25:11.700 we only got that off the ground we started drilling for oil setting up the investment

00:25:16.340 mechanism so the money could transfer over so you know if you got to imagine so we we do something

00:25:23.620 called general revenue funds in canada okay so when money goes whether taxes or whatever it goes

00:25:28.980 over and it goes to a general revenue fund and then from there it's earmarked through budgets

00:25:34.020 into programs okay right they decided not to do that they decided to take an opposite track and

00:25:41.940 they took the money uh from themselves and they transferred it over it was brilliant if you think

00:25:48.100 about it it was absolutely brilliant because now they're not touching it they're not having

00:25:51.940 governments uh manipulate it so you know it's kind of like that that bank account my wife has

00:25:58.740 for us that we just no matter what that money doesn't get touched i no matter what we always

00:26:04.180 put this amount in exactly the wealthy barber see we grew up in a generation of the well it's funny

00:26:09.700 i just did a show with tim sesnick which uh brilliant guy does a global medical um a global

00:26:16.020 mail article every week or two incredible episode yeah so he he talked to us about uh wealth

00:26:23.060 management and all the things he does with the family group his company and you know it's

00:26:29.240 interesting as a government the Norwegian government realized by taking this oil money by taking the

00:26:35.280 taxes and the profits and the offshore profits putting it directly into the fund so and not

00:26:42.560 having government touch it and then having MBM invest the fund and then taking the returns and

00:26:51.860 automatically reinvesting them so not any time during this cycle does government touch it

00:26:59.220 other than when they come back and they have to legislatively agree to take only up to three

00:27:06.720 percent for shortfalls in any given year and it has to pass a vote in their legislative exactly

00:27:13.060 to get that money because it has to pass as a budget so then the number of uh safeguards and

00:27:20.480 the number of guardrails that are thrown up to prevent governments accessing the money and

00:27:25.700 allowing this fund to build is really well thought out. And this is where we're at with this

00:27:32.300 Prime Minister Mark Carney's fund. We're kind of at that pivotal moment where Canada, and I do,

00:27:39.400 again, I'm not criticizing, I'm commending. I think he listened. He understands he needs a fund.

00:27:46.760 He understands that productivity is a major challenge for the country right now.

00:27:52.040 But what he does in the guardrails and how this fund is strategically set up will determine whether it's a success.

00:28:02.120 So probably not you and I, definitely not me, but my kids, right, will be seeing the results just like I'm seeing the results.

00:28:10.820 I'm you and I are living the results of the bad decision back in by it was the Mulroney government to sell off Petro Canada when Norway went the other way.

00:28:22.200 This fund will be successful or not successful based on the policies, guardrails and procedures he puts in place now.

00:28:29.380 And how productive we get with the investments that we make and how much the return on investment that we put in place.

00:28:34.920 But, you know, there should be a hurdle rate for the so we should be setting up a hurdle rate, which is kind of like the show I said, like I did with Tim, where, you know, the monies that go into this fund only so much can be accessed by government.

00:28:48.220 Right. The money still must be earmarked. All these policies and procedures and bylaws that get put into this company basically will dictate that, I hope.

00:28:57.380 and i hope he's going to announce that soon and then the strategic prioritization of which

00:29:04.000 projects we're going to put in and that's the tricky one that's the one that we're not talking

00:29:09.160 about right now you know we just uh use it can't be our major projects like sorry but i just feel

00:29:14.840 like these projects that are meant to uh bolster the country that are our own federal projects

00:29:22.500 should not be qualified like this maybe and you paul please correct me if i'm wrong and assuming

00:29:28.420 that this is what it's going to do but in my mind that global investment strategy that norway has

00:29:34.260 used to create a behemoth fund here makes a lot more sense than just investing solely should it

00:29:40.580 maybe be divided up in some way should we be investing globally and then you know trying to

00:29:46.980 be the first money in on the right companies here how do you envision this working properly

00:29:51.780 well we're not so this is interesting because i'd love to be in the uh position that we could

00:29:57.060 actually be investing globally but we're we're at least a decade away from even getting back to

00:30:05.220 the lower uh tier of productivity in the world so we're so far off on our productivity side so

00:30:12.340 this is going to take a long long time to reinvest our money into projects make sure

00:30:17.700 they hurdle a return that'll make the fund build be disciplined enough when governments change

00:30:23.860 again norway being smart enough because governments can't uh touch the money and

00:30:30.100 they have to legislatively up to three percent only touch the money if they need it it actually

00:30:35.300 allows the fund managers to keep it going in our case we're going to have to allow our fund managers

00:30:41.060 to read to invest the money in projects that have a return to make it grow so a little different a

00:30:46.420 lot different um and those uh projects are the tough ones because a lot of them are resource

00:30:53.380 projects and you and i've seen over the last week there's some really scathing uh news about uh

00:31:00.420 overpriced overvalued stocks and swindles and things going on there's a a gold mine the ceo

00:31:08.420 of a gold mine is going to jail this week yeah exactly well and that you know we've heard that

00:31:12.900 throughout our lifetime right of people who've overvalued so how do we know that the investments

00:31:17.940 that we're making aren't swindles i don't know and that's that's my fear in only investing in

00:31:23.460 a country that is low per low productivity is that our roi is going to vanish well and that's

00:31:30.420 again that's pure poly but not to be doing glue what are those choices does he have right now

00:31:37.780 see that's where i was trying one and i'm glad they listened on our shows i'm glad the shows

00:31:41.620 might have made an impact because quite frankly i couldn't see another path like i think this is

00:31:49.700 kind of one of those hell mary paths we have as a country right now that we either have to try

00:31:54.240 something like this because quite frankly how do you go out to the private markets based on our

00:32:01.020 productivity and where we are now and say come to canada put your money in canada with our

00:32:06.140 regulations red tape uh all the things that they have to encounter low productivity put your money

00:32:12.300 here and hope for return it's pretty hard so by seeding a fund and having the government use our

00:32:18.620 public money to get people to come in and back the projects is really key the the second thing

00:32:25.020 that i i would advise them right now like norway which we're far off the norway model but you can

00:32:31.740 take bits and pieces of it make sure we maintain uh control and ownership of whatever we jointly

00:32:41.740 put money into so don't give up don't go doing another petro don't go selling off your assets

00:32:48.300 uh you know to make it to shore when the you know the boat is out of fuel and you start burning the

00:32:53.500 boat the old story and then it sinks because you basically used all the wood and you can't go any

00:32:59.340 further and then the boat sinks like let's not get this going get it profitable get it building all

00:33:05.740 pat each other on the back and then one day sell the fund that's my next concern is we tend to

00:33:11.600 build great things that are profitable uh the 407 in ontario airports across the country we do we

00:33:19.540 basically gave a bridge to the u.s that they won't let us open yeah i mean we have a tendency to make

00:33:26.280 bad decisions federally in this regard. These investments need to be heavily monitored. I have

00:33:33.240 one last little question on the investment capitalization. Of course, we hear Pierre

00:33:37.180 Polyev out there saying, oh, he's putting it on the country's credit card. We're going to have to

00:33:42.720 pay the price tomorrow. That is a perspective I think worth examining. But then the next question

00:33:48.400 is is 25 billion dollars enough to see the fund i mean we've seen 70 billion in ontario go to bad

00:33:56.480 retraining the arrive scam uh problem was billions of dollars it seems like we have a lot of money

00:34:03.840 floating around out there couldn't we have seeded this a little better or would that not have been

00:34:08.160 worth it no you make it's a good point you know and it's a whole other show but i'm just going to

00:34:14.480 give you a piece of it and then we'll we'll get leave for another show but it's very interesting

00:34:19.920 yesterday when we were talking uh this whole conversation about opec and uh uh leaving opec

00:34:29.520 so this is now going to cause a bunch of issues potentially for canada and you know i i don't

00:34:35.760 really know because i'm not in the heads of ottawa and the government in ottawa but whether they

00:34:42.080 foresaw this whether they were foretold i i don't really know but now i think what we have to do is

00:34:47.840 really watch what we're doing and watch what's going to come of that because quite frankly now

00:34:55.040 you're in a new battle and whether the u.s is winning that battle or losing that battle it's

00:35:00.800 hard to determine right now because you know you've you've you've taken some of the the juice

00:35:06.560 away from iran from saudi arabia you know the instability in oil prices uh you know if you

00:35:14.080 really want to blockade and run oil prices down to a minimum level to stop them you really have a

00:35:22.640 interesting pathway now so there's a lot more tools in the tool chest uh potentially of the

00:35:28.240 United States and the UEN that might be coming to bear what the impacts are on oil in Canada and

00:35:37.020 what are our next steps with far as resources and investments. That's the next decision we have to

00:35:42.540 make. It really does seem like that is the fog ahead of us, isn't it? Like, how do we actually

00:35:47.800 make quality investable opportunities for ourselves that ever return? Yeah, we're going

00:35:54.680 to see in the next few days. And that decision, when that plays out, that'll tell us what our

00:35:58.840 next decision is and whether or not that $25 billion is the right number or way too little.

00:36:04.360 Thanks for going through this with me. I really appreciate it. And if you have questions or

00:36:08.040 comments, you think that we've missed something, that's how we get our conversations going around

00:36:12.400 here. So please don't hesitate to let us know what your thoughts are on this. Norway has a

00:36:18.400 behemoth fund. Canada is launching one. Will it have the same future? It's for us to watch and

00:36:24.540 see and keep an eye on the government to make sure they do the right things and have the right

00:36:28.520 policies. Thank you, Paul. Thank you, Mike.

True Patriot Love - May 04, 2026

Canada’s Norway Fund Gamble： Wealth or Boondoggle？

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