The Globe and Mail reports in its Saturday edition that U.S. President Donald Trump's turbulent tariff and policy manoeuvres are upending markets, hiking risk of loan defaults and stalling business investment. The Globe's Stefanie Marotta writes, however, that the hit to Canada's biggest banks has been more muted than feared. When the country's lenders released second-quarter financial results over the past week, they set aside more money for debt defaults. Beyond these reserves, the banks' earnings signal they are able to withstand economic shocks -- so long as trade and geopolitical tensions do not escalate. The current state of the softening economy and precarious trade policy is manageable, but the outlook could worsen significantly if uncertainty persists or escalates, according to Bank of Montreal chief risk officer Piyush Agrawal. "If nothing gets resolved and we are in this high uncertainty environment and back to an April 2 kind of announcement, that -- you can see in our base-case forecast -- has a significant impact on Canadian and U.S. economies," Mr. Agrawal said during a conference call with analysts, referring to Mr. Trump's revealing of so-called "reciprocal" tariffs.