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Writing Tuesday morning March 31st, another huge short covering rally is taking place on the optimism that the war will be ending "soon". Over the past several weeks we've seen this movie at least a dozen times, however, bulls keep believing it over and over again. Trump's goal with all of his massively contradictory messages was to lull Iran into a state of complacency while he built up ground forces in the region. However, the net effect of these "hopeful" message was to ro

This marks the end of week four of the U.S./Israel war on Iran, with no end in sight. Clearly Trump totally underestimated Iran's will and ability to go toe-to-toe in an ever-escalating war, as Iran has shown no sign of capitulation. The U.S. troop build-up continues in the background as Trump attempts to intimidate Iran into surrender. Both sides are far apart in their negotiation demands, because Trump's standard negotiation tactic of "escalating to de-escalate" is backfiri

Trump has been building up troops in the Middle East in order to prepare for his Plan B ground attack. We don't know exactly where ground troops will be deployed, but the highest probability target remains Kharg Island. Nevertheless, it doesn't matter where U.S. troops land, because the market reaction will be the same: Panic, over the idea that this war could go on for several months or longer, and in the process implode the global economy. Markets know that there are only a

This is now week four of the Iran war with no end in sight. The pattern of the war has stayed fairly consistent from the start - the U.S. and Israel pound Iran incessantly with their air superiority while Iran blocks the Strait of Hormuz with their superior tenacity. The strategic miscalculation the U.S. military made was believing that after having attacked Iran last June that they can just show up whenever they want and start carpet bombing the country without any consequen

The consumer is imploding due to high oil prices and the Fed can't do anything about it because of high oil prices. This isn't "stagflation" as so many bulls want to believe - this is obliteration... Yesterday, we got the news that recession will be unavoidable if oil prices remain at these levels for even a few more weeks despite the fact that the U.S. has energy independence. Why? Because oil is a global commodity, therefore a supply shortfall in the rest of the world trans

I had to take some time off of posting on Twitter because my mind had melted down at the amount of bullshit streaming out of the Trump Administration regarding this ONGOING Iran clusterfuck. Trump's latest demands that the world now clean up the gargantuan mess that he made would make a petulant three year old blush. But I don't want to go down the rabbit hole of wartime propaganda again. So below I will focus on markets: Despite the obvious risks, Wall Street pundits remain

"Bin Laden wanted to draw the United States into Afghanistan, which was already being called the graveyard of empires...Bin Laden caught America at a vulnerable and unfortunate moment in its history" Wright, Lawrence. The Looming Tower (p. 272). What Bin Laden started, Iran is finishing. The U.S. and Israel are attacking Iran for the second time in less than a year, which has given the Islamic regime zero incentive to stand down in another fake ceasefire. Trump has painted hi

At the Monday open in Asia global oil prices sky-rocketed to Ukraine war highs (see second graph below) and the overnight futures imploded. However by Monday afternoon in the U.S. Trump was getting worried so he declared "victory" on the war in Iran and said it would be over "soon". Markets sky-rocketed on the news and oil tanked. However, this morning (Tuesday) the IRGC stated what anyone could predict except Trump and the Wall Street Journal, which is that they have no inte

This is an update on the Iran war and markets at the end of the first week of the war. Picking up where we left off mid-week - having killed Iran's religious leader Trump is now demanding unconditional surrender of the Islamist regime. Therefore this coming week Iran's religious warriors will all lay down their arms and become insurance salesmen. And if you believe that, then you've been watching Faux News for too long and your brain is imploded. This is all deja vu of Operat

The worst thing that could happen to global markets at this point in the cycle is happening right now: A late cycle surge in inflation due to a Middle East oil crisis. This is a mid-week Iran war update. My last update was Monday. What we have learned in the interim is that Iran has been preparing for this war since last June. They now believe that in a long-term war of attrition they can hold out longer than the U.S. and Israel. We know that the U.S. and Israel have inflicte

First, I will get the politics of this Iran fiasco out of the way before I focus on markets: This morning "Secretary of War" Pete Hegseth gave a briefing telling the American public that the U.S. is retaliating for 47 years of "one way" aggression by Iran against the United States. Nothing could be further from the truth. Iran has never attacked the U.S. on its own soil. Whereas the U.S. has attacked Iran twice just in the past year. In addition, the U.S. funded the Iraqi pro

Up until now I have been focused mainly on the AI asset crash. With this post, I will focus more on the economic consequences of AI. But first an update on the rolling asset crash. Research firms have been putting out articles recently predicting industry after industry that will be "disrupted" by AI. I call it "AI panic". It started with software but has now spread like wildfire to other sectors and stocks both within Tech and other industries. The disruption within Tech has