I sincerely you had a wonderful Easter with your family and friends.
Here in the Hill Country, we were blessed with rain that was seriously needed.
It cut into my yard work, but that was fine by me. It will always be there next week.
The holiday gave me a distraction from what has been going on in Iran.
That was, of course, until I had to go put fuel in my diesel pickup.
There are several trips I have put off simply due to the added cost.
There is no denying that we will feel this in our pocketbook.
The extent of the impact on inflation will be determined by how long the oil supply is curtailed.
It will have an impact and I am concerned it may be longer term than we will be comfortable with.
Those of us of a certain vintage remember the last oil price surge beginning in 1979, where oil prices climbed to $1.35.
It was no fun waiting in line to pay exorbitant prices. The question becomes how high and how long.
The regime in Iran only cares about power and will do whatever it can to stay there, no matter the cost to the people of Iran.
They showed how callous they can be killing over 30,000 supposed protesters.
Securing the Straits of Hormuz will be no easy task.
Should costs actually begin to climb, I don’t see how the Federal Reserve can resolve the situation.
Raising interest rates will not impact the price of oil.
Should the economy falter under the weight of rising crude, rising interest rates won’t be a stimulus, but an obstacle.
l will not get in the middle of a debate over the pros and cons of attacking Iran.
What I do care about is what this will do to the economy.
I felt the same way about the actions taken during the pandemic.
In each case a policy was taken and the economy was left to suffer.
This is the real problem I find with much of what comes out of DC.
It is almost the economy be damned.
On the counter of that is the global economic policy that put us in bed with China for the short-term benefit to the economy.
What we woke up to was China saw this as an economic war that they were in for the long term.
Making policy is no easy task, no matter what your political persuasion.
The long-term impacts are hard to predict, as most are not really considered to obtain short-term goals.
I am actually amazed the markets have not panicked and fallen more than they have.
We are still above 4500 on the S&P 5000.
That is a move back from the record levels of 5000 which is a correction.
It is not yet a bear market. I wish I could give you a reliable time line on the resolution of this issue.
I can only say that incursions last longer than projected, and dire forecasts are usually far off.
