The Financial Post reports in its Saturday edition that fixed mortgage rates are pegged to rates in Canada's fixed-income market, which in turn follow rates in the U.S. bond market, much like train tracks. Guest columnist Robert McLister writes that in the last seven weeks, the U.S. side of those train tracks has surged, with the five-year Treasury yield up 65 basis points. Canada's five-year has lagged because our economy is weaker. We also face more headwinds these days with lofty debt levels. When thinking about interest rates, it helps to keep in mind BMO's Shelly Kaushik, who said in a note Thursday, "The old adage of 'what's good for the U.S. economy is good for the Canadian economy' remains true." Now we have Donald Trump 2.0. Markets fear a Republican sweep will be like giving a credit card to an impulsive child who just discovered on-line shopping. Team Trump could therefore have wide rein to ramp up spending, cut regulations, deport low-cost workers and impose tariffs. All of that will be inflationary. We are adding decent U.S. growth to easing monetary policy, tossing in inflation, a weakening fiscal balance sheet and new spending. This is a recipe for higher yields, both in the U.S. and eventually in Canada.