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Credit markets cracking / ME war:no sign of easing / Hormuz still blocked, WTI $100 again / Risk under pressure=USD bid

  • sc0172
  • 3 hours ago
  • 4 min read

  • Donald Trump and Iran’s leader traded barbs, with the US president saying stopping Tehran from obtaining nuclear weapons matters more than the cost of oil. Mojtaba Khamenei vowed to keep the Strait of Hormuz closed. Benjamin Netanyahu said he cannot guarantee regime change in Iran without an internal uprising. (BBG), Trump says he thinks Iran's new supreme leader is alive but 'damaged'. (Reuters), US has further eased Russian sanctions, allowing ALL countries (and not just India) to buy Russian oil already loaded by March 12, WSJ >>> This is nightmare for fuel price : JPMORGAN: "If the US cannot achieve a short-term victory, it seems likely that it will be forced to attempt a ground war to reopen the Strait of Hormuz. If so, this could transform into a multiyear war", 'diesel shortages and NatGas shortages in some places already', ..Iran is taking out $1.2 billion US radar systems and hitting targets in Jordan and Bahrain with pinpoint accuracy. Experts admit they are likely receiving direct targeting intelligence from Russia and a massive Chinese electronic warfare vessel off the coast.

  • Markets : Let's face it, the U.S (big techs etc etc) has always depended MASSIVELY on Gulf Nations investing in America (IF this has to stop and/or simply be decreased for food security say, there would be MASSIVE consequences in the U.S for long-term valuations..)...., Private credit fund gates so far this month: Blue Owl → BlackRock → HPS → Cliffwater → Morgan Stanley, Adobe CEO Shantanu Narayen is stepping down after 18 years, Honda slumps to first annual loss since going public in the 1950s (whole sector been in big trouble), VERY expensive war, crude up, shipping costs up, supply chain tightening, bond yields rising (in a huge govt debt pile..), hidden credit stress building in private credit world, western countries facing a rising funding needs competing with a faster EMG world, tough place to be, hard to see this ending without more printing of 'fiat issuance' over time.. >> further rotation going, though much under pressure in eq world, 10's UST yields 4.28% alarm bells.. (the longer it goes on, the worst it gets fiscally in US and many others..), USD 'risk-off bid', could drag us back to 1.10 EURUSD, SPX 6K, again duration of conflict is ALL that matters, Hormuz etc..

  • The Fed can't cut because of oil. Can't hike because of jobs. Can't do nothing because the curve is screaming (higher inflation & expected fiscal expansion due to oil crisis..), Monetary policy was built for one crisis at a time, we have -3- of them at the same time...

  • US, China officials to meet in Paris on March 15-16, before Trump-Xi summit

  • Deutsche Bank flags a US$30 bil exposure to private credit

  • IMF's former economist warns Governments around world don't have the fiscal capacity needed to respond to any economic downturn caused by an OIL SHOCK (Iran knows...), this is clearly not great, but obvious, watch bonds/duration ...Damn if you do, damn if you don’t: The U.S. and Israel face two bad options when it comes to Iran (Thread)

  • Amazon sold $37bn in debt on Tue, for the 4th largest corporate bond sale of all time

  • And so it starts (they won't be the last..!),Denmark’s Energy Minister urged people to reduce fuel use amid the oil shock from the Iran war, saying: “Please, please, please — if you do not need to drive, do not do so.”







Not going to happen..unless equity markets have a 'mini collapse' - perhaps Trump demands Powell cut rates as Iran conflict raises energy prices | Fox Business


Badly..




President Trump is "enthusiastic" about continuing the war in Iran for at least another 3-4 weeks even as oil prices rebound, per Axios. Details include:

1. Following a G7 call, France's President Macron said "no one can tell what Donald Trump wants from this war"

2. US and Israel have not secured the 450 kilograms of highly enriched uranium that Iran holds

3. US and Israel reportedly "do not entirely agree on what winning looks like"

4. "We don't want to leave early, do we? We gotta finish the job, right," Trump said

















 
 
 

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