Trump’s Iran deadline expires tonight. Bank earnings Friday. CPI Wednesday. And Dimon’s 48-page warning letter just landed.
THE RUNDOWN
WAR › Trump’s extended deadline for Iran to reopen the Strait of Hormuz expires tonight at 8 PM Eastern. There’s been no breakthrough. On Sunday, Trump posted: “Tuesday will be Power Plant Day, and Bridge Day, all wrapped up in one, in Iran. There will be nothing like it!!! Open the Fuckin’ Strait, you crazy bastards, or we will open it for you!” Iran has denied any direct negotiations. If the deadline passes without progress, the next escalation could include strikes on energy infrastructure and bridges. The Pentagon has already positioned Special Operations forces in the region, and reports indicate planning for up to 10,000 additional ground troops. WTI closed at $112.61.
MACRO › Jamie Dimon released his annual shareholder letter this morning, and it reads like a warning siren. At 48 pages, it’s his most alarming yet. He called gradually rising inflation “the skunk at the party” and warned that the Iran war could generate persistent oil and commodity shocks that keep rates elevated far longer than markets expect. He invoked the 1974 and 1982 recessions, both driven by oil-fueled inflation spirals, as historical parallels. On private credit, he noted that losses are already running “a little higher than they should be” relative to current conditions. On Europe: “America needs Europe to succeed, and it’s currently on a bad path.” On sentiment: “Human nature has not changed. Falling asset prices at one point can change sentiment rapidly and cause a flight to cash.”
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