Saturday Morning Confusion about the F-35 and the SAAB Gripen!

The most important question in Canada's fighter jet decision may not be about either fighter jet!

While Ottawa's review of the F-35 purchase drags into its second year, the nature of air combat itself is being rewritten. 

In June 2026, the United States Air Force signed its first production contracts for more than 150 AI-piloted "loyal wingman" drones... formally, Collaborative Combat Aircraft... (CCA) built by Anduril and General Atomics at roughly $30 million apiece! (About a third the price of an F-35!) 

The stated goal: at least 1,000 semi-autonomous wingmen flying alongside American fighters by the end of the decade.

These are not surveillance drones. 

They are uncrewed fighter aircraft, designated in the fighter series for the first time in USAF history... designed to scout ahead of crewed jets, jam radars, carry missiles, and absorb the risks no air force wants to spend a pilot on! 

Boeing's Australian-built MQ-28 Ghost Bat made its first static appearance at Farnborough this month. 

The United Kingdom already has its first autonomous collaborative platform in RAF service. 

Japan, China, Türkiye, and India are all building their own!

Which raises an awkward question for Canada: "We are spending years deciding between two crewed fighters while the rest of the alliance decides how to team crewed fighters with uncrewed ones!"

 The answer we choose will quietly determine which AI-wingman ecosystem Canada joins... and on whose terms!

Where the Fighter Decision Stands:

A quick recap for readers just joining this file. 

Canada signed for 88 F-35As in January 2023, in a program now costed above $27 billion. 

One day after becoming prime minister in March 2025, Mark Carney ordered a review of the purchase... a direct response to American tariff pressure and the broader deterioration in Canada – U.S. trust! (Canada remains legally committed to the first 16 aircraft, with deliveries beginning this year!)

Since then, the options have multiplied. 

In January 2026, Saab formally offered Canada 72 Gripen E fighters plus six GlobalEye early-warning aircraft, with Canadian assembly and an estimated 12,600 Canadian jobs attached. 

By late May, La Presse reported that a mixed fleet of roughly 30 F-35As and 60 Gripens had emerged as the review's preferred outcome! 

A June CBC report described an even larger option: A 140-jet force combining 72–88 F-35As with up to 72 Canadian-built Gripens!

Reporting now suggests no announcement before the U.S. midterm elections in November 2026... "Ottawa apparently prefers not to hand Washington a grievance during an American campaign season!"

The AI Wingman Race Changes the Question:

Here is where the drone story cuts into the fighter story... in both directions!

The case for the F-35 just got stronger! 

The American CCA program is years ahead of everyone else's, and the F-35 is being built as its quarterback. 

The FQ-42 and FQ-44 drones now entering production are designed to fly alongside F-22s, F-35s, and the future F-47, and the USAF is already exploring foreign military sales of the CCA to allies. 

An F-35 fleet gives Canada a plug-and-play path into the most mature drone-teaming ecosystem in existence... no small thing for NORAD, where seamless interoperability with the USAF is the whole point!

But... so did the case for the Gripen!!! 

The entire premise of Carney's review is that Canada is dangerously exposed to U.S. - controlled defence supply chains! 

If that worries you about a fighter's software, it should worry you twice as much about autonomous combat aircraft whose AI, weapons authorization, and upgrade path all run through Washington! 

Saab's counter-offer speaks directly to this anxiety... and it is more credible than most Canadians realize!

In mid-2025, Saab and the German AI firm Helsing flew a Gripen E in Swedish airspace under the control of an AI agent called Centaur, which executed beyond-visual-range combat manoeuvres against a human-piloted Gripen D, tracked targets with onboard sensors, and cued the pilot when to fire. 

The system had trained itself through more than 500,000 simulated flight hours. It was a genuine world first for an operational front-line fighter, and it was possible because the Gripen E's software architecture allows new functions to be integrated and re-certified in days rather than years — the exact quality Canada's 2021 evaluation scored at 28 out of 100 for "upgradability."  (Flawed!)

Hold that thought!

Saab has also suggested Canada could become a development partner in Sweden's next-generation combat air program, KFS... the program building Sweden's future stealth fighter and its family of wingman drones. 

Combined with Canadian Gripen assembly and technology transfer, that is an offer to make Canada a co-developer of the next generation of this technology rather than a customer for the last one!

The honest caveat: Saab's wingman drone does not yet exist! 

Its demonstrator will not fly until 2027, an engine supplier has not been secured, and the American designs are already in weapons testing! 

SO... The Gripen path buys sovereignty and industrial participation in a future capability... the F-35 path buys access to a present one! 

That is the real trade, and no press release from either company will state it that plainly!

The 2021 Evaluation Deserves a Second Look:

Defenders of the original F-35 decision point to the leaked scorecard from the 'Future Fighter Capability Project:' (The F-35 scored 95 percent on military capability... the Gripen E just 33 percent! Case closed for bias... eh?)

When two aircraft with fundamentally different design philosophies produce a result this lopsided... the criteria are doing as much work as the airplanes! 

An evaluation that heavily rewards stealth penetration of defended airspace will always crown the only stealth aircraft in the competition. 

Whether deep-strike stealth is the right thing to weigh at half the scorecard for a country whose actual daily missions are Arctic sovereignty patrols and NORAD interception over enormous distances is precisely the question the evaluation never had to answer.

Two further facts sharpen the concern! 

The Swedish business press has reported, citing confidential sources, that Ottawa applied a risk coefficient that significantly reduced the Gripen's scores simply because it was a new-series aircraft... and National Defence has refused to disclose its methodology, citing procurement integrity! 

And two of the competition's European entrants, Dassault and Airbus, withdrew before final scoring as well... with Airbus explicitly arguing the terms favoured the F-35!

None of this proves the Gripen would have won a differently weighted competition! "A department confident in its methodology would publish it... the refusal to do so is the strongest single piece of evidence that the 2021 evaluation answered a narrower question than... What does Canada need?"

What This Decision Is Actually About:

Strip away the horse race and the Carney review comes down to this: "Does Canada want to be a renter in the American air-power system, or a junior partner in building a European one?"

Tenancy has real advantages... the best aircraft, the most mature drone ecosystem, frictionless NORAD integration. 

It also has the disadvantage Canadians have spent eighteen months relearning: "The landlord can change the terms... Partnership offers sovereignty, jobs, technology transfer, and a seat at the table for the AI-teaming era!"

And the skeptics deserve the last word on sovereignty's limits: "Geography does not move. Continental air defence, NORAD data-sharing, and wartime coordination will run through Washington regardless of which airframe sits on the ramp at Cold Lake! 

The Gripen cannot buy Canada independence from the United States! 

What it can buy is leverage, options, and an industrial base... which, in 2026, may be the more honest definition of sovereignty anyway!

The government's own delay tells you it understands the stakes! 

A decision that was supposed to take three months is now timed around American elections! 

Whatever Ottawa announces after November, remember that the fine print about drones, software, and who controls the upgrades will matter more in 2035... than who's logo is on the tail!

Allan's Canadian Perspective covers Canadian defence procurement, energy policy, and Canada–U.S. strategic dynamics. Previous coverage in this series includes the F-35 review timeline and the Canadian Patrol Submarine Project decision!

Nancy Unfiltered - A Canadian Lens!

Guest post by Nancy McClure:

When Donald Trump announced yet another round of tariffs on Canada, I did what I've learned to do over the past year and a half.

 
Pondered, then wrote... What struck me wasn't the tariffs. It was the difference between how our two countries are responding.

The hostility toward Canada coming out of Washington is political. It comes from one administration and the people who choose to echo it.

Here, something entirely different has happened.

 
I need to point out that Mark Carney didn't ask me to stop travelling to the United States.

 
He didn't ask me to stand in the grocery store turning over every can to see where it was made.
He didn't ask me to buy Canadian produce, Canadian beef or Canadian wine.

 
He didn't ask me to rethink where I spend my vacation dollars.

Canadians did that all by ourselves.

 
Not because anyone ordered us to.

 
Because that's how democracies work.

 
Citizens decide.

 
Our government is doing its job.

 
They're negotiating trade agreements, strengthening alliances and deciding where Canada's next submarines should come from.

 
I'm deciding where my tomatoes come from.

Both matter.

 
One protects our country at sea.

 
The other supports it one grocery cart at a time.

I'll admit something.

 
I wasn't always the person reading every label in the produce aisle.

 
Two years ago, if someone had told me I'd be standing there squinting at country-of-origin labels like I was deciphering the Dead Sea Scrolls, I'd have laughed.

 
Now I catch myself doing it automatically.

 
I probably spend more time reading produce labels than I do the instructions that come with most things I buy.

Our local fruit is in season right now, and instead of assuming I'll buy imported blueberries in the middle of January, I'm looking at my freezer and wondering just how many more bags I can squeeze in before summer disappears.

 
It's become a bit of a game.

 
Tetris deep freeze version.

 
Rearrange this container, move that package of soup, slide the blueberries over there.

 
Future January me will be grateful.

It's such a small thing and by itself won’t have a major impact.

 
But then millions of Canadians decide to do the same thing.

That's the part I don't think Donald Trump ever anticipated.

 
He thought tariffs would pressure governments.

 
Instead, they motivated citizens, and it has changed us as consumers.

And while we're on the subject of understanding Canada... Donald Trump still seems convinced that our wildfire problem could be solved if we'd simply rake the forests.

I have a modest proposal.

 
Let's fly him into northern Ontario on a Twin Otter on floats. Trust me, there's no better way to see this country.

 
It's certainly a lot more educational than looking at it from 30,000 feet in a 747 and deciding you've got Canada all figured out.

 
I'm not suggesting we do this during wildfire season.

 
I'm not completely unreasonable.

 
We'll send him up in the spring as part of preventative forest management.

We'll leave him there with a rake, a tent, enough bug spray to battle a proper Canadian mosquito season, which, for those unfamiliar, isn't for the faint of heart, and nearly 1.3 billion acres of forest stretching farther than he can imagine.

He can let us know when he starts making progress.

The point isn't that forest management doesn't matter.

 
It absolutely does.

 
Canada invests heavily in fuel reduction, controlled burns, thinning programs and wildfire response.

The point is that anyone who believes one of the largest forested countries on Earth can simply "rake the forest" probably doesn't understand forests.

 
Or Canada!

I've heard people ask why Canadians have responded the way we have to this treatment we have received from the United States administration.

 
The answer is actually pretty simple. We're not doing it because someone told us to.

 
If anything, Canadians are almost genetically programmed to resist being told what to do.

 
We're doing it because this is one of the few ways ordinary citizens can make their voices heard.

History has a funny way of humbling countries that mistake their strength for permanence.

 
Spain learned it.

 
Britain learned it.

 
The Soviet Union learned it.

 
Great nations don't fall because someone else suddenly becomes stronger.

 
They falter when they become convinced the rules no longer apply to them.

Canada has never needed to be the biggest country in the room.

 
We've always been content to be a dependable one.

So no, Mark Carney didn't tell me to change how I shop.

 
He didn't ask me to skip that trip south.

 
He didn't ask me to fill my freezer with Canadian blueberries while they're in season.

I chose to.

 
Millions of Canadians chose to.

 
That's the remarkable part of this story.

 
Governments buy submarines.

 
The rest of us buy groceries.

So every time I choose Canadian blueberries, Canadian beef, Canadian wine, or decide that this year I'd rather explore Gros Morne than the Grand Canyon, I am supporting this beautiful country.

 
Quietly.

 
Without yelling, waving a flag or posting a slogan.

It turns out democracy isn't measured by how loudly a leader tells you to love your country.

 
It's measured by whether you're still free to decide what loving your country looks like.

And sometimes it sounds like the quiet click of shopping cart wheels rolling across the floor of a Canadian grocery store! (The one with the wonky wheel! - ed!)

ANYTHING TO HELP OUT FOLKS!!!!

At present, we have about 200 fires raging up north!

Canada's boreal forest spans approximately 1.3 billion acres [about 485 million to 566 million hectares]. This vast ecosystem stretches across 10 provinces and territories, making it one of the largest intact forest and wetland ecosystems on Earth! 

U.S. President Donald Duck Drumpf said all that smoke from our wildfires is because we haven't practised safe sex forest management... so Prime Minister Mark Carney got together some of his friends... and they are now raking up the leaves and dried twigs!

CARNEY vs. DRUMPF!

On Monday, Donald Trump signed an order imposing 50% tariffs on a broad range of Canadian goods... wine, dairy, cement, furniture, paper, plywood, even hockey gear... invoking Section 338 of the Tariff Act of 1930, a Depression-era law that had gathered dust for nearly a century! 

Prime Minister Mark Carney called the move a "direct violation" of CUSMA. 

And then he did what he has done at every escalation point since taking office: he offered to talk!

Which raises the question a lot of Canadians are asking right now. 

If Trump keeps this up, is there a point where Carney decides enough is enough and reaches for the nuclear option... energy export taxes, critical mineral restrictions, or walking away from CUSMA altogether?

My answer: almost certainly not!

And the reasons why tell you a great deal about how this Prime Minister thinks — and about where Canada's real leverage actually sits!

What Trump's Section 338 Tariffs Actually Cover — and What They Don't:

The details of Monday's order matter more than the headline number. 

The 50% tariffs apply to consumer and industrial goods that were previously protected under CUSMA. (But the exclusion list is the tell: energy products, potash, fish, and critical minerals are all exempt!)

That is not an oversight! 

American refineries run on Canadian heavy crude. 

American farms run on Saskatchewan potash. 

The American defence and technology sectors need Canadian critical minerals. 

The White House carved out exactly the categories where Canada holds genuine leverage... which is an implicit admission of where that leverage lies!

Readers of this blog will recognize the shape of this. 

The Operation Tidewater framework I've written about before mapped Canada's escalation options: energy exports, electricity to the northeastern states, potash, and tidewater access that reduces our dependence on the U.S. market over time. 

Trump's exemption list reads almost like a mirror image of that framework. 

He knows what he can't afford to tax!

Carney's Pattern: De-escalate, Diversify, Outlast!

Carney campaigned in 2025 on "elbows up!" 

In office, the elbows came down almost immediately. 

Canada removed most retaliatory tariffs in August 2025 and cut counter-tariffs again in October. 

When Trump added a 10% surcharge over the Ontario 'Reagan ad' last fall, Carney declined to respond in kind and simply repeated that Canada was ready to resume negotiations. 

Monday's statement followed the identical script: name the violation, decline to escalate, offer intensified talks!

Critics... Doug Ford was the loudest among them... calling this week for "tariff for tariff, dollar for dollar" retaliation...! (See capitulation?) 

But there is a coherent strategy underneath the restraint, and it rests on three pillars!

1. The asymmetry problem is real:

Roughly three-quarters of Canadian exports go to the United States. 

A far smaller share of American exports comes north. 

In a full-scale economic war, both sides bleed, but Canada bleeds faster. 

Retaliatory tariffs are a tax on Canadian consumers first and a message to Washington second. 

Carney, the former central banker, has clearly run that arithmetic and concluded that matching Trump blow for blow is a strategy for feeling good, not for winning!

2. Leverage held in reserve is worth more than leverage spent:

The nuclear option... restricting energy, potash, or critical mineral exports... works exactly once! 

The moment Canada uses it, the exemptions protecting those sectors vanish, the Americans accelerate substitution, and the threat that currently disciplines U.S. behaviour is gone. 

As long as Trump keeps exempting energy and minerals, the deterrent is functioning. 

Firing the weapon would destroy its value!

3. Time is on Canada's side — if we use it:

Trump's tariffs raise costs for American families, a point Carney made explicitly in his Monday statement. 

U.S. midterm politics, consumer prices, and business pressure all work against sustained tariff escalation on the American side. 

Meanwhile, every month Canada spends building trade ties with Europe and Asia, advancing energy corridors, and moving product to tidewater is a month that shrinks the leverage Trump holds over us. 

The strategy is to outlast, not outpunch!

The One Scenario Where the Calculus Changes:

None of this means Carney's restraint is unconditional. 

Two developments could force his hand!

The first is if Trump ever extends tariffs to the exempt categories... energy, potash, or critical minerals! 

At that point, Canada's reserve leverage is being destroyed anyway, and the case for using it before it depreciates becomes compelling! 

The second is a total collapse of the CUSMA review: If it becomes clear there is no deal available at any price... the domestic political cost of continued restraint would start to exceed the economic cost of retaliation!

Even then, expect surgical measures rather than a true nuclear strike... targeted export levies on specific products flowing to specific states... calibrated to maximize pain in politically sensitive districts while minimizing blowback at home. 

That is how a central banker fights a trade war.

The Bottom Line:

The honest debate is not whether Carney will go nuclear... he won't, absent a direct hit on energy or minerals! 

The debate is whether his patience reads in Washington as strategic discipline or as an invitation! 

Ford's position has a real logic to it... If hitting Canada never costs Trump anything, why would he stop? 

Carney's counter is that the costs are accumulating on their own... in American grocery bills, in American politics... and that Canada's job is to be positioned for the day the pressure breaks!

Monday's 50% tariffs are a test of that thesis. 

If Carney is right, the exemption list stays intact, American domestic pressure builds, and Canada emerges with its leverage unspent and its trade increasingly diversified! 

If he's wrong, we'll know soon enough... because the next escalation will tell us whether restraint bought us anything at all!

In the interim... I'll go with Carney... NOT Drumpf!

Who tamed fire?

 Quick... for a million bucks... Who tamed fire for the first time? 

Well... although we can't pin the exact date for this one... according to the "Way Back Machine..." fire was originally tamed and used by someone called Urk about 1,002,657 B.C.E. in what is now called western Kenya! (Give or take about ten years!)

NO WORDS!

Ok. This is a hoot. pic.twitter.com/vufMDJ5mTP

— Claude Taylor (@TrueFactsStated) July 17, 2026

Smoke gets in your eyes!

Look, folks, it was lightning that started all those fires... not the Canadians themselves!

But... Drumpf is pissed again because he claims we don't do enough to keep our 10 million square miles of Boreal forest floor free of twigs, bushes, and stuff...!

So...!

To keep them happy, we sent a couple more firefighters from the Canadian Forces Base in Cold Lake to help out!

OUR MUSIC WAS BETTER!

 This was the culmination of the Beatles' genius... and what our music was all about! 

(Our music WAS better!)

Is it is? Or is it isn't?

It's getting to the point that I can't tell anymore if the Strait of Hormuz is open... or closed!

SOMEBODY, PLEASE HELP ME!

Sunday Morning Funnies!

Peter Pullover was right!

Pullover just talked about how people in Canada were going to food banks and social services more often than in the past... which is true... but according to research done by the "Perspective Research Department," it's NOT because of the Liberal Party... It's because today's immigrants have a cultural affinity for "FREE STUFF!"

In other words... if the government offers it... Take it!!!!

They do it over there... so why not here?

Also, They're also pretty good at scams in both the States, and here in Canada!

Saturday Morning Confusion About Ukraine!

 Well, kids... this war has gone on waaaaaaay too long! 

So I put the "Perspective Research Department" on the case... and this is what they came up with!!!!

***

This is a map of the eastern end of Russia and the western end of Ukraine!

Russia gives Crimea back to Ukraine... and then Ukraine gives the stuff to the right of the yellow line to Russia!

Now... everybody go home and behave yourselves!

T.G.I.F.

Since it's Friday and the markets are closed for the weekend... I thought it was a good time to show you this!

Take Away the A.I. Stocks and What's Left? 

A Healthier Market Than You Think!

What the S&P 500 looks like without the Magnificent Seven — and why Canadians should be watching the other 493 companies, not the seven everyone talks about.

Here is a thought experiment worth doing with real numbers: Take the S&P 500, remove the A.I. trade... Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta, and Tesla, the so-called Magnificent Seven... and look at what remains! 

***

The exercise sounds academic. 

It isn't! 

The S&P 500 without AI stocks turns out to be a different market entirely, and in 2026 that difference has become the single most useful diagnostic tool an observer of the North American economy can have!

A Third of the Index Is Seven Companies:

Start with the scale of the problem. As of July 2026, the Magnificent Seven carry a combined market value of roughly $22 trillion... about one-third of the entire S&P 500. 

That weight has hovered between 32% and 35% for the past year. 

Put another way: when you buy a plain index fund believing you own "the market," a third of your money is riding on seven companies whose valuations rest largely on a single technological bet!

This is not a normal state of affairs. 

Concentration at this level exceeds anything seen at the peak of the dot-com era, and it means the daily movement of the index tells you more about sentiment toward one trade than about the health of the American economy!

The Tale of Two Markets in 2026:

Now remove those seven names and watch the picture change. There is an exchange-traded fund that does exactly this... the Defiance Large Cap ex-Mag 7 ETF, ticker XMAG, which holds the S&P 500 minus the seven. 

Its performance this year against the full index is instructive:

• The Magnificent Seven, measured by the Roundhill MAGS ETF, peaked in late October 2025 and have been drifting downward since — falling as much as 12% at points this year.
• The full, cap-weighted S&P 500 has been dragged down with them, off roughly 4% at the spring lows.
• The other 493 companies... some analysts have started calling them the "Impressive 493" have held nearly flat to modestly positive.

And beneath that flat aggregate number, the old economy is having a genuinely good year. 

By late winter, energy stocks were up more than 23%, basic materials nearly 18%, consumer staples over 15%, and industrials about 14%. 

Healthcare and even residential construction have joined the advance. 

Money is not fleeing the stock market... it is rotating out of the crowded A.I. trade and into everything else!

What the Market Without A.I. Stocks Actually Tells Us:

Three conclusions fall out of the numbers.

First, the underlying American economy is in better shape than the headline index implies. The 493 trade at far more ordinary valuations. Their anchors... JPMorgan, Exxon Mobil, Johnson & Johnson, Walmart... are companies with decades-long records of dividends backed by real cash flow. 

The famous warnings about the S&P 500's stretched valuation are overwhelmingly a statement about seven stocks... not five hundred!

Second, the index is no longer a mirror of the market. Because the seven still account for roughly a third of the index's weight, a bad day for Nvidia moves the S&P 500 more than a good quarter for a hundred mid-sized industrial firms. 

Investors who believed they held a diversified portfolio have, in fact, been holding a concentrated technology bet with a long tail of other companies attached.

Third, the unwind... so far... is orderly! The feared scenario has always been that an A.I. correction takes the whole market down with it. 

What has actually happened through mid-2026 is a rotation... capital leaving the seven and finding a home in energy, materials, financials, and staples. 

This is the "broadening out" that market veterans like Ed Yardeni predicted when he ended his buy call on big tech last December, arguing that the AI story could only continue if its benefits spread to the companies buying the technology, not just the ones selling it!

What Can Be Done With This Information:

For an ordinary investor, the toolkit is straightforward and already exists. 

Equal-weight index funds, the largest being the Invesco S&P 500 Equal Weight ETF (RSP), assign each of the 500 companies the same 0.2% weight, cutting Magnificent Seven exposure from about 35% to roughly 1.4% while keeping full exposure to American large caps. 

Funds like XMAG exclude the seven outright! 

Neither is a prediction that A.I. stocks will crash; both are simply ways to own the market without owning quite so much of a single trade. (The usual caveat applies.... this is a description of the instruments, not investment advice!)

But the more valuable use of the ex-A.I. market is diagnostic, and this is where the Canadian interest comes in.

The performance gap between the seven and the 493 is a real-time gauge of whether the A.I. correction stays contained or turns systemic. 

Watch the tripwire: as long as the 493 keep grinding higher while the seven deflate, what we are witnessing is a sector repricing... painful for index holders, but not a repeat of 2000 or 2008. 

If the 493 begins rolling over as well, it means the damage is spilling over into the broader economy through reduced capital spending, a shrinking wealth effect, and tighter credit!

That distinction matters enormously north of the border. 

A.I. data-centre construction has been one of the few forces propping up American GDP growth. 

A contained unwind leaves U.S. demand for Canadian energy, lumber, metals, and manufactured goods largely intact… and note that the sectors leading the 2026 rotation, energy and materials, are precisely the sectors where Canada sells! 

A systemic unwind, by contrast, would hit Canadian exports just as the country works its way out of its technical recession, though it would likely also accelerate the rotation into Canadian federal bonds that has already been underway as global investors look for alternatives to U.S. assets.

The Bottom Line:

Strip the AI stocks out of the S&P 500, and you find a market that is neither euphoric nor collapsing... just an ordinary economy, reasonably priced, going about its business! 

The bubble, if that is what it is, lives in seven names! 

The information in that split is more useful than any forecast... it tells you where the risk is concentrated, gives you the means to step around it, and... for those of us watching from Canada... provides an early-warning system for whether America's A.I. reckoning will stay on Wall Street... or arrive at our loading docks!

Keep your eye on the 493. They are the real market!

Trump Jinxes Team U.S.A.

 

How much would it cost to drive across Canada?

 $914.67

Northern Shield Energy Corridor:

 Canada's Boldest Pipeline Proposal in a Generation!

July 6, 2026 — London, Ontario

This morning in Calgary, against the backdrop of Stampede week, Premiers Danielle Smith and Doug Ford unveiled the proposed route for the Northern Shield Energy Corridor… a 3,300-kilometre pipeline that would carry Western Canadian oil from Hardisty, Alberta, to the refining hub of Sarnia, Ontario, along a route that never leaves Canadian soil!

For those of us who have been following the slow-motion drama of Canadian pipeline politics, this is the announcement that changes the conversation. 

Not because it is a done deal... it is very far from that... but because it puts an all-Canadian eastern route squarely on the national agenda for the first time since Energy East died in 2017!

What Was Announced:

The essentials of the Northern Shield pipeline proposal:

• Route: A 3,300 km primary corridor from Hardisty, Alberta... the storage and pricing hub of the Canadian oil patch... to refineries in Sarnia, Ontario, crossing Saskatchewan and Manitoba along the way.
• Capacity: An estimated 500,000 barrels per day, with potential expansion to 800,000 barrels per day.
• Cargo: The broader corridor vision includes not just crude oil but natural gas and other energy products moving from Alberta and Saskatchewan to refineries and ports in southern Ontario.
• Materials: The provinces say the line would be built with Canadian steel, supporting domestic manufacturing and supply chains.
• Next steps: A feasibility study is already underway, expected by the end of 2026. Ontario says it will now work out cost estimates, commercial models, and related opportunities, including grid upgrades and a potential strategic petroleum reserve.

The announcement builds on the memorandum of understanding that Alberta, Ontario, and Saskatchewan signed last year, committing to new energy and trade infrastructure. 

Today, that MOU acquired a map.

Why "Northern Shield" Matters: The Energy Security Argument!

The name is doing real work here. This is being framed not as an export project but as a shield... a defensive piece of national infrastructure. 

The logic runs as follows!

Eastern Canadian refineries still depend heavily on imported oil and on the pipeline routes that dip through the United States! 

Line 5... which feeds Sarnia, crosses Michigan and has been the subject of years of legal threats from that state's government. 

Every barrel that reaches Ontario refineries today does so at the pleasure of American jurisdictions. 

In an era of tariff wars and CUSMA brinkmanship, that is a strategic vulnerability, and both premiers know it!

An all-Canadian route from Hardisty to Sarnia would give this country something it has never had: "The ability to move Western oil to Central Canadian refineries without asking anyone's permission!" 

Add a strategic petroleum reserve... explicitly on the table in today's announcement... and the "shield" framing starts to look less like branding... and more like doctrine!

Readers of this blog will recognize the theme. 

I have argued for months that Canada's real leverage in its dealings with Washington lies in energy, potash, electricity, and critical minerals... and that leverage is only real if we have the infrastructure to redirect flows. 

The Manitoba Problem:

The proposed route passes near Regina and Winnipeg, which means Manitoba is not optional... and Manitoba has, so far, refused to sign on! 

Premier Wab Kinew's position is principled and clearly stated: His government will pursue large-scale projects that begin with Indigenous partnership, not projects that consult Indigenous communities after the route has been drawn!

This is not a trivial objection, and it should not be waved away as an obstruction. (The graveyard of Canadian megaprojects is full of proposals that treated Indigenous consultation as a box to tick at the end rather than a partnership to build at the start.)  

The lesson has been taught repeatedly and expensively!

To their credit, the proponents seem aware of it. 

Ontario says it has initiated its duty to consult with Indigenous partners and is supporting Indigenous involvement in nation-building projects, and the corridor documents point to the Manitoba–Crown Indigenous Corporation as a potential vehicle. 

Ford, for his part, praised Kinew today... and sounded hopeful about bringing Manitoba aboard. 

Whether hope translates into equity stakes and genuine co-ownership will determine whether this project lives or joins its predecessors in the archive.

Two Pipelines, Two Directions, One Week:

Here is the detail that makes this week remarkable: The Northern Shield announcement comes only days after Alberta formally proposed a separate crude pipeline to the southwest coast of British Columbia, in partnership with the federally owned Trans Mountain Corporation and Calgary's Pembina Pipeline Corp!

Premier Smith is now pushing for both accesses simultaneously... west to tidewater and Asian markets... east to Canadian refineries and energy security. (And down the line, there will be pipes to Prince Rupert and Churchill as well!!!!)

It is the most aggressive pipeline posture any Alberta government has taken in decades, and it puts Ottawa in an interesting position. 

Mark Carney's government has staked its economic strategy on nation-building projects and reduced dependence on the United States. 

It will be difficult for the federal government to champion that vision while standing aside from a project literally named for shielding the nation.

The Questions Nobody Answered Today:

A healthy dose of skepticism is warranted, and here is where mine points:

Who pays? No cost estimate was offered, and no private-sector proponent has stepped forward to own and operate the line. 

Energy East was pegged at roughly $16 billion nearly a decade ago! (A 3,300 km line through the Canadian Shield in 2026 dollars will not be any cheaper!) 

Until a commercial model emerges... [private capital, provincial equity, federal backstop, Indigenous ownership stakes] or some blend... this remains a map... not a pipeline!

Is there demand? Sarnia's refining complex is substantial but finite. 

A 500,000 bpd line exceeds what Sarnia alone can absorb, which is why the announcement gestures toward "export markets" and the extension of infrastructure to Eastern Canada! 

That gesture quietly revives the 'Energy East' question: Does this line eventually reach Quebec and Saint John?) 

Nobody said so today. But everybody was thinking it!

What does Ottawa do? The federal major-projects framework will decide how quickly... or whether... this proposal moves. 

Watch for the federal response in the coming days, particularly with the NATO summit in Ankara drawing attention to security and infrastructure spending commitments!

The Bottom Line:

Today's announcement is a route on a map, a feasibility study, and two premiers with a shared political interest in building things. 

That is not nothing... it is more eastern-pipeline momentum than this country has seen in nine years. 

But the distance between a Stampede-week press conference and steel in the ground is measured in Indigenous partnerships, commercial commitments, federal approvals, and billions of dollars that no one has yet put on the table!

The Northern Shield Energy Corridor is the right idea arriving at a moment when the country is finally receptive to it. 

Whether it becomes real infrastructure or another entry in Canada's long ledger of pipeline proposals... will depend on whether its proponents learned the actual lesson of the last decade... in this country... you do not build around people — you build with them!

I will be following the feasibility study and the Manitoba negotiations closely. 

Subscribe or check back for updates as this develops!

WE NEED A NEW STANDARD OF CURRENCY EXCHANGE!

ALLAN SAID; Sal... would it make sense to drop the American dollar as our trading currency and develop a new base currency strictly for exchanges between different monetary systems?

SAL SAID: Yes! In fact, economists have discussed versions of this idea for decades. 

The question isn't whether it makes sense in principle... it does! 

The challenge is getting enough countries to adopt it!

The basic idea is to separate the unit used for international trade from national currencies. 

Instead of Canada paying in U.S. dollars, for example, Canada would pay in an international settlement currency. The U.S. would then receive the equivalent value in U.S. dollars through the settlement system.

There are several advantages:

• Countries would no longer need to hold enormous reserves of U.S. dollars.
• Trade would become less vulnerable to U.S. monetary policy or sanctions.
• Exchange-rate risk could be reduced because each country's currency would be converted only once, into the settlement currency.
• No single country would receive the enormous economic privilege that comes from issuing the world's reserve currency.

This idea isn't entirely new.

One example is the IMF Special Drawing Rights (SDRs). SDRs are a basket of major currencies and already exist as an international reserve asset. 

However, they are used mainly between governments and central banks rather than for ordinary trade!

Another proposal came from John Maynard Keynes in 1944. 

He proposed a global clearing currency called the Bancor! 

Under his system:

• Every country would keep its own currency.
• International trade would be settled in Bancors.
• Countries with persistent trade surpluses and deficits would both be encouraged to rebalance, making the system more stable.

The proposal lost to the American-backed system, which established the U.S. dollar as the world's dominant reserve currency after the Bretton Woods Conference.

Today, the idea is receiving renewed attention because:

• China wants to reduce dependence on the U.S. dollar.
• The BRICS countries are exploring alternative payment systems.
• Digital payment networks and central-bank digital currencies make international settlement technically much easier than it was 80 years ago.

My own assessment:

I think the long-term trend is toward two layers of money:

1. National currencies (Canadian dollar, euro, yen, etc.) used by citizens and businesses within each country.
2. A neutral international settlement currency, likely digital, used only between banks and governments for cross-border transactions.

People might never even see the second currency. 

A Canadian company would still invoice in Canadian dollars... the banking system would automatically convert the payment into the settlement currency... and then into the recipient's local currency!

That approach would preserve national monetary sovereignty while reducing dependence on any one country's currency.

Ironically, advances in AI and distributed financial technology could make such a system practical. 

AI could continuously optimize exchange rates, monitor liquidity, detect fraud, and balance settlement flows in real time... making a neutral global clearing currency much more efficient than was possible when Keynes first proposed the Bancor!

***

If the global monetary system changes substantially over the next 20–30 years, I think it is more likely to evolve toward this kind of neutral settlement layer than toward a single world currency. 

It offers many of the efficiencies of a common trading currency without requiring countries to give up control over their own domestic money.

ALLAN SAID: That's what I thought... and do you have a name for this exchange currency?

SAL SAID: If someone were designing this from scratch today, I'd avoid names tied to any existing country or political bloc. 

The name should convey neutrality, stability, and function!

Here are a few possibilities I think would work well:

Name	Comments
Terra	Suggests "the world." Simple and memorable.
Nexus	Implies connection between monetary systems.
Unis	From "universal settlement." Short and easy to pronounce.
Merca	Derived from "mercantile." Trade-focused.
Globa	Straightforward global identity.
Concord	Emphasizes cooperation rather than politics.
Axis	A central point around which currencies rotate.
Equa	From "equilibrium" or "equal exchange."
Unita	Suggests unity while remaining politically neutral.
Bridge	Symbolizes connecting national currencies.

If it were my project, though, I'd probably choose something even more descriptive.

Instead of calling it a currency, I'd call it an "International Exchange Unit!" (IEU)

Countries wouldn't "hold IEUs" the way they hold dollars today. 

Instead:

• Canadian dollars → IEUs → Japanese yen
• Euros → IEUs → Mexican pesos
• Australian dollars → IEUs → Brazilian reais

If you owe... It's I.O.U!

If you exchange... It's I.E.U!

The IEU would simply be the common denominator through which all exchanges pass.

That has a psychological advantage as well. 

People don't feel like they're adopting someone else's money. They're simply using a neutral accounting unit, much like the internet uses common protocols to move information without replacing everyone's computers.

Knowing your interest in creating enduring concepts, I might even go one step further and coin a term specifically for this role:

The Exchange Standard: (XS)

The idea is that it's not a currency in the traditional sense... it's a standard of exchange! 

Every national currency would be valued relative to the XS, and AI-driven settlement systems could handle the conversions instantly behind the scenes.

I actually like Exchange Standard because it shifts the conversation away from "Who controls the currency?" to "What is the common standard for fair exchange?" 

That framing may make the concept more politically acceptable!