Middle East Tensions Escalate

Not too surprisingly, the Iran problem didn’t go away over the weekend.  If anything, both sides are making threats that would significantly expand the conflict. What’s more, Trump’s unilateral actions have resulted in Iraq’s parliament calling for all US troops to withdraw from Iraq – without question an important win for Iran.

Trump’s 2011 predictions of a politically-motivated attack on Iran by Obama (which obviously never came to pass) are causing many to question the timing and motivation of his own actions, not to mention the existence of a coherent Middle East strategy.

So far, equities’ reaction has been contained.  Though, gold and bonds are providing a less filtered reaction to the escalating risks. Gold popped up to tag our next upside target… …and, 10Y notes broke out.Past Trump-related emergencies (trade war, impeachment, etc.) have been easily downplayed or explained away. I can’t imagine that Trump or his sycophants will be able to spin this latest series of missteps as unimportant.

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