- Six months until peace?…
- “You just buy stocks”…
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Dear reader,
When will the United States and Iran come to terms — and shake hands upon a peace accord?
The answer, say certain Arab and European grandees… is perhaps six months.
Reports Bloomberg:
- Some Gulf Arab and European leaders believe that a US-Iran peace deal will take about six months to be agreed and that the warring sides should extend their ceasefire to cover that timeframe, according to officials from the regions familiar with the matter.
A six-month truce carries through to October. October is one month or less prior to November’s midterm elections.
You can be certain that President Trump will be keen — keen as mustard — to announce peace by that time.
Meantime, what about the oil price across a six-month span? Will oil keep flowing through the Hormuz Strait?
Can the Ceasefire Hold?
The existing ceasefire expires on Apr.22. The United States and Iran, claim reports, are presently in negotiations to extend the truce.
I hazard it will be extended. Yet can the cessation of fire endure six months of bickering?
I am far from convinced that it can. As, evidently, is Bloomberg:
- There is no guarantee the two sides can agree to prolong the ceasefire, let alone reach a formal peace deal. Beyond the Hormuz strait, which Iran says it wants to have control over indefinitely, contentious issues include Iran’s nuclear and missile programs, sanctions relief for the Islamic Republic, and the ongoing war in Lebanon between Israel and Tehran-backed Hezbollah.
Adds Mr. Rob Macaire — or is it Sir Rob Macaire? — former British ambassador to Iran:
- There won’t be a deal between the US and Iran in the short term… It’s not just about whether negotiations succeed, but rather if they do enough in the coming period to prevent a return to kinetic conflict. That’s doable but voices within Iran will likely be itching to return to firing missiles and it’s a massive game of chicken.
Who Will Blink First?
Finally, Freedom Financial News contributor Jim Rickards argues that, “It’s not much of a ceasefire…. the two sides don’t agree on anything.”
Here Mr. Rickards likewise refers to the chicken game cited above:
- This is a gigantic global game of chicken between Iran and the United States.
- Iran is betting that even though they’re suffering financially, the world will suffer to a much greater extent, which will cause the United States to call it off.
- The United States is betting that Iran will be choked off and they will economically collapse before the world does.
Which side will be proven correct? Which side will be proven incorrect?
One fellow must eventually blink his eyes first.
Stocks Jump to Record Heights on Hopium
Yet I am pleased to report a note of progress.
Yesterday President Trump announced a 10-day ceasefire between Lebanon — which stables the Israeli foe Hezbollah — and Israel.
Iran had demanded that Israel back off its Hezbollah surrogate as a condition of peace.
A ceasefire is not peace. Yet neither is it war. And it may potentially eventuate in peace.
Is a ceasefire likely to eventuate in peace? I would be very, very surprised if it does eventuate in peace.
Yet Wall Street will reach for any plausible straw of optimism. And Wall Street has seized upon the slender straw of Israeli-Lebanese peace.
Yesterday both the S&P 500 and Nasdaq Composite attained fresh, optimistic heights.
Thus reported Yahoo Finance yesterday:
- US stocks posted fresh records on Thursday after President Trump said Israel and Lebanon agreed to a temporary ceasefire, which has been a key sticking point in US-Iran negotiations.
- The Dow Jones Industrial Average rose 0.2%. The tech-heavy Nasdaq Composite climbed 0.4% to hit a new record, while the S&P 500 rose about 0.2% to post an all-time high after pushing through the 7,000 level in the previous session.
I am eager to witness Wall Street’s reaction to the likely collapse of the Israeli-Lebanese ceasefire.
Yet I let it pass for now.
“You Buy Stocks”
Typical of Wall Street’s prevailing bullishness is Mr. Bob Doll, chief executive officer of Crossmark Global Investments.
From whom:
Why is this happening? Because good news is good news, bad news is good news, and no news is good news. You buy stocks.
Indeed… you buy stocks.
Good news, bad news, no news — you buy stocks.
Stocks in winter, stocks in spring, stocks in summer, stocks in fall… stocks in fair weather, stocks in foul weather… stocks in war… stocks in peace…
You just buy stocks.
‘You just buy stocks’ is thus the way to everlasting wealth.
Precisely as Wall Street counseled just prior to October 1929, the great bear market of 1966-82, the technology bubble of 2000, the housing bubble of 2008…the…
Brian Maher
for Freedom Financial News
