Hi All,

Happy Friday! Hope everyone had a (relatively) good week, let’s dive into things.

Word of the Week

Nothing burger (n)

Something that was expected to be significant or important but turns out to have no real substance or impact; an event, announcement, or story that generates a lot of attention but ultimately delivers nothing meaningful.

• Trump's primetime address was a classic nothing burger: twenty minutes of things everyone already knew, dressed up in the language of a major announcement.

• After weeks of rumors about a blockbuster trade deal, the press conference turned out to be a complete nothing burger, with both sides agreeing only to "continue talks."

• She had been dreading the performance review for weeks, but it turned out to be a nothing burger. Her manager said everything was fine and sent her back to her desk.

What’s Happening in the News

Pam Bondi Is Out

Attorney General Pam Bondi is out after roughly fourteen months on the job, pushed overboard by the same Epstein files controversy that first made her famous in MAGA circles. She spent months building expectations by telling Fox News audiences that a blockbuster client list was "sitting on my desk right now to review," only for the DOJ and FBI to later conclude that no such document existed. Congress eventually forced her to release millions of pages of Epstein records through a bipartisan transparency law, and still accused her of dragging her feet and hiding material. With a House subpoena for an April 14th deposition hanging over her head, one that would have put her under oath about what the DOJ knew, what it withheld, and what role Trump played, she was gone before she could sit down for it. Trump praised her on Truth Social and named his former personal defense lawyer, Deputy Attorney General Todd Blanche, as acting attorney general. House leaders have since confirmed the subpoena still stands, so Bondi may end up testifying anyway, just without the government salary.

Israel's Other War

While the United States and Iran have been dominating the headlines, Israel has been quietly running a parallel military campaign in Lebanon that, in almost any other news cycle, would be the lead story on its own. After the joint US-Israeli strikes that killed Iran's supreme leader in late February, Hezbollah, the Lebanese militant group and longtime Iranian ally, resumed large-scale missile and drone attacks on northern Israel for the first time since a ceasefire agreement in 2024. Israel's response has been extensive.

Israeli jets have carried out hundreds of airstrikes across Lebanon since the escalation began, hitting targets in Beirut's southern suburbs, the Bekaa Valley, southern border villages, and areas as far north as Tripoli. Israel says it is targeting Hezbollah command centers, weapons storage facilities, tunnels, and financial institutions. Lebanon's health ministry and UN figures put the death toll at over 1,200 people since the escalation began, with more than a million people displaced from the south toward cities like Sidon and Beirut. Aid organizations have raised serious objections over strikes that have also destroyed homes, clinics, and ambulances.

On March 16th, Israel announced a ground operation in southern Lebanon aimed at pushing Hezbollah back from the border and establishing what it describes as a forward defensive buffer zone extending roughly 30 kilometers into Lebanese territory, up to the Litani River. Israeli officials have indicated they intend to maintain security control over parts of this area even after active fighting ends, a position that has drawn strong criticism from the Lebanese government and the United Nations, and comparisons to Israel's approach in Gaza. Hezbollah continues to fire rockets and drones at Israeli towns and military bases in the north.

The TSA is Not Okay

If you have been watching American news this week, you may have noticed that the country is simultaneously managing a war with Iran and an airport security crisis at home. Travelers passing through Houston have reportedly waited eight or more hours in security lines, missing flights entirely. The cause is a partial government shutdown that has left the Transportation Security Administration (TSA), the federal agency responsible for airport screening, severely underfunded and understaffed. Other major hubs like Chicago's O'Hare appear to be operating normally, which makes Houston's situation even harder to explain.

Trump has since signed an executive action directing the Department of Homeland Security to pay TSA agents using other available funds, and wait times have dropped sharply as a result. Congress still has not passed a full DHS funding bill, however, and the shutdown technically remains ongoing. The TSA is currently running on an emergency workaround rather than an actual budget, which means the situation is stable for now in roughly the same way a car with a slow leak is stable: fine until it isn't.

What makes all of this particularly uncomfortable is that the United States is currently at war with a country whose supreme leader has publicly called on Muslims around the world to take revenge against Americans. The TSA was created specifically after the September 11, 2001 attacks to prevent exactly that kind of security failure. Running it on a financial patch during an active conflict with Iran is either a bold strategic choice or a spectacular oversight, and neither option is especially reassuring. If you plan on visiting the US anytime soon, be careful folks!

The Coalition That Was Never Theirs

As the war enters its sixth week, a phrase has been circulating among conservative commentators: the "generational coalition" has been squandered. The argument is that Trump assembled a historic political coalition in 2024, and the Iran war is burning it down before it could be used for anything worthwhile.

Critics of this framing point out that it misreads what that coalition actually was. The visible part included Hispanic voters, podcast audiences, people exhausted by progressive cultural politics, and even some Arab Americans in Michigan angry about US support for Israel in Gaza. But the people who actually funded and organized it were a different group: tech investors positioning their companies for government contracts, Wall Street donors who wanted lower corporate taxes and favorable interest rates, and a well-organized pro-Israel donor network that wanted a particular foreign policy outcome. In 2016, roughly sixty percent of Trump's fundraising came from small donors. By 2024, that ratio had reversed.

The argument being made is not that the coalition was squandered, but that it was used exactly as intended. Corporate tax cuts passed. The AI regulatory environment was shaped to benefit certain companies. The war with Iran began. The donors got what they paid for. Voters were promised two things in 2024: mass deportations and no new wars. What they got was the opposite of both.

The Speech That Said Nothing

Trump delivered his long-anticipated primetime address on April 1st and announced essentially nothing. He spent twenty minutes remaking the original case for the war, declared that military objectives would be completed "very shortly," promised to hit Iran "extremely hard in the coming weeks," and said the Strait of Hormuz would open "naturally" once hostilities ended. Markets had spent two days pricing in an imminent withdrawal announcement. When that announcement did not come, oil prices jumped back to approximately $116 per barrel within hours of the speech ending.

The gap between the administration's public messaging and the situation on the ground has now been formally confirmed by the US government's own intelligence community. Multiple American intelligence agencies have officially assessed that Iran is not willing to engage in substantial negotiations, believes it is currently winning the war, and does not trust the United States. Iran's position, according to officials and mediators, is that it wants a permanent peace treaty ratified by Congress, not a temporary ceasefire. The reasoning is straightforward: a ceasefire benefits the United States more than Iran, because it would allow the US to replenish its depleted weapons stockpiles and regroup for a future attempt, while Iran would simply wait. From Iran's perspective, the United States threw everything it had at them, failed to topple the government, and is now asking for a pause. Iran's answer, stated clearly to mediators, is no.

Every public claim Trump has made about the diplomatic process, that Iran begged for deadline extensions, that Iran has agreed to terms, that substantial progress is being made, has now been denied by Iran, by the intermediary countries, and by the US government's own intelligence assessments.

The war's balance sheet after five full weeks makes for uncomfortable reading. Trump announced five objectives at the outset: destroy Iran's missile capacity, sink its Navy, destroy its nuclear complex, eliminate its regional proxy network, and achieve regime change. Of these, exactly one has been accomplished: the Navy has been sunk. The other four objectives have not been achieved. Meanwhile, a sixth problem that was not on the original list has materialized: Iran has seized effective control of the Strait of Hormuz and is formalizing it as a permanent toll arrangement, modeled on the Suez or Panama Canal. Iran entered this conflict controlling roughly four percent of the world's oil supply through its own exports. By closing the Strait to Western-aligned shipping while collecting a reported two-million-dollar toll from friendly nations, it now exercises veto power over twenty percent of global oil flows and a significant share of the world's liquefied natural gas. That is not a temporary condition of the conflict. Iranian officials have made clear it is the new permanent reality.

The military losses have continued accumulating in ways that are not fully reflected in official statements. An E-3 Sentry airborne surveillance aircraft was destroyed this week, one of roughly a dozen the United States operates and a platform the country no longer manufactures. At least thirteen US bases across the region have been rendered inoperable, with troops in some locations reportedly moved into hotels. The USS Gerald Ford, officially taken offline after what the Pentagon described as a laundry room fire, has been under repair in Greece for two weeks. A third carrier, the USS George H.W. Bush, is now sailing to join the Abraham Lincoln in the region, giving the United States three carrier strike groups deployed simultaneously, which is the opposite of a drawdown.

The most significant new development is a plan Trump reportedly requested from the Pentagon to physically seize Iran's stockpile of nearly 1,000 pounds of highly enriched uranium. The material is buried deep underground at a facility whose entrances were collapsed by bombing last year. The plan, as described by Pentagon sources, would involve flying excavation equipment into Iran, clearing the collapsed tunnels using heavy construction machinery, extracting the radioactive material with specialized personnel, building a temporary runway in the vicinity, and flying everything out on cargo planes. The operation would take weeks, conducted under continuous Iranian drone and missile fire, in the middle of a country with a large and motivated military. Military analysts have described it as potentially the most complex special forces operation ever attempted, significantly larger in scope and risk than anything in recent US military history.

The strategic logic behind pursuing both this operation and a potential Kharg Island seizure simultaneously is that these are the only two remaining leverage points available. Controlling Iran's uranium removes the nuclear threat permanently and denies Iran the ability to reconstitute it if the regime eventually collapses. Controlling Kharg Island, from which Iran exports ninety percent of its oil, gives the United States something to trade for Strait access without having to destroy Iran's energy infrastructure and trigger the catastrophic Gulf-wide retaliation that scenario would guarantee. The United Arab Emirates has now publicly committed to supporting a US-led military operation to open the Strait by force, offering its territory as a staging ground and potentially contributing its air force, marking the first Gulf state to formally enter the conflict as a combatant.

What none of this resolves is the fundamental problem. Iran is not negotiating because it believes it is winning, and the available evidence supports that belief. The United States cannot achieve its objectives with air and sea power alone. A ground operation of the scale being discussed would produce significant American casualties and might not succeed. If it fails, the political and strategic pressure to escalate further becomes even harder to resist. If it partially succeeds, Iran still controls the Strait and still has the capacity to make the Persian Gulf extraordinarily dangerous for anyone operating in it. The administration's own stated timeline of two to three weeks has now been offered and extended so many times that it functions less as a deadline and more as a recurring reassurance to financial markets.

A Pattern Worth Noting

The Iran war is not the only place this week where a Trump initiative ran up against the limits of what is actually executable. A federal judge blocked the administration's plan to demolish the historic East Wing of the White House and replace it with a large ballroom and underground command center, ruling that Trump is the steward of the White House, not its owner, and that the project requires congressional authorization. The demolition had already begun before the legal review was completed. Separately, the Supreme Court heard oral arguments this week on Trump's executive order ending birthright citizenship, with Trump already publicly criticizing the Court in apparent anticipation of an unfavorable ruling.

Taken together with the Greenland retreat, the China tariff reversals, the Russia deadlines that came and went, and the mass deportation program that stalled, a consistent pattern has emerged: dramatic announcements, aggressive timelines, and a quiet step back when the reality of execution sets in. The Iran war is the most consequential version of this pattern, and unlike the others, there is no obvious way to quietly step back from it.

What’s Happening in the Markets (Not Financial Advice)

🛢️ Oil & the Strait of Hormuz

Traffic through the Strait of Hormuz has collapsed to roughly 4-5 vessels per day from a normal ~151, with only ~10% of typical volume transiting. WTI crude surged to $112/barrel on April 2, its highest daily close in approximately four years, with Brent at similar levels, and analysts are openly projecting $200/barrel if the disruption holds. The shock is asymmetric: only ~2.5% of Hormuz oil flows to the U.S., while China, India, Japan, and South Korea account for roughly 75%. The U.S., as the world's largest oil and LNG producer, sits on the other side of that trade. U.S. LNG exporters are already pricing it in, with Venture Global up ~40% in the past month and Cheniere Energy up ~15%. The timing is not incidental. Energy disruption is applying structural pressure on China precisely as U.S.-China trade negotiations reach a critical juncture, making the Strait as much a geopolitical choke point as an energy one.

📉 Stagflation Risk

The conditions for stagflation are converging in textbook fashion: a severe supply shock combined with excessive monetary expansion. M2 is growing at 10.6% annually as of February while the official CPI sits at 2.4%, with the next print forecast at 3.1%. Since the war started, corn is up ~14%, soybeans ~15%, and wheat ~21%, all driven by energy's direct transmission into fertilizer costs. The policy dilemma mirrors the 1970s but with one compounding variable: $39 trillion in national debt at ~120% debt-to-GDP. The Fed cannot cut without pouring fuel on inflation, and cannot hike aggressively because the government is already paying over $1 trillion annually in interest on short-duration Treasuries being continuously rolled. The only remaining option is to hold and absorb, which produces exactly the stagflationary outcome: weakening growth, rising unemployment, and prices that won't come down.

🏦 Fed Watch & Monetary Policy

The Fed balance sheet grew from $6.055 trillion on December 31 to $6.271 trillion as of March 25, with roughly $40 billion printed per month going into T-bills and Treasuries as the Fed acts as buyer of last resort. Rate cut expectations have collapsed entirely. CME FedWatch puts the probability of no cut at the April 29 FOMC meeting at 97.4%, and that no-cut probability holds at 88-92% through September. More significantly, the market has now opened the door to rate hikes, an option that did not appear in the probability distribution as recently as two months ago. The 30-year fixed mortgage rate has already moved from 6.0% to 6.66% in the past month, tracking the 10-year yield higher.

📈 Bonds Under Pressure

U.S. Treasury bonds have fallen ~5% since the start of the Iran conflict, wiping approximately $1.2 trillion in market value. The 30-year yield is pressing against 5% and the 10-year sits at 4.37%. The decisive technical signal is the 2-year yield jumping back above the Fed funds rate of 3.75%, shifting the market's posture from dovish to hawkish. The last time this happened was 2022, after which long-term yields climbed from 2% to 5% in a matter of months. The deeper risk is the term premium, currently near 0%, which sat above 2% during each of the three prior major oil shocks in 1973, 1979, and 1990. A normalization to even 1-2% would push the 30-year yield to 6-7%, levels not seen in over 30 years, dragging mortgage rates, corporate borrowing costs, and credit card rates higher across the board.

📊 Equities & Late-Cycle Dynamics

The S&P 500 bottomed around 6,350 (ATH: 7,043) at end of March and has since bounced, with the critical pivot overhead at ~6,700, the 50% midpoint of the full decline. A sustained close above that level with higher lows reactivates bull momentum. Failure to clear it keeps the bounce classified as a relief rally with high failure risk. Notably, on April 2 stocks, bonds, and oil all closed higher simultaneously, an inflation signal rather than a growth one. The VIX is tracing the late-cycle pattern visible at both the 2000 tech top and the 2007 real estate peak: higher lows forming as prices grind higher, a sign of rising systemic stress. Multiple crises are compounding at once including AI capex with no clear return horizon, private credit stress, bond market pressure, and homebuilder weakness. Tops are a process, and these are unlikely to all break simultaneously. One thing after another is the more probable path.

💰 Gold

Gold pierced the $4,400 support level intraday but held it on a closing basis, preserving the higher-timeframe bull structure. Current price is ~$4,591, and a push back through $4,900 would confirm near-term consolidation. The recent sell-off has identifiable sellers: Russia is liquidating reserves to fund foreign imports with dollar and euro access frozen, and Turkey is selling to defend the lira against ~35-39% domestic inflation. Critically, government bonds are not acting as the traditional war-period safe haven. Yields are rising across the board as capital loses confidence in sovereign debt, a condition that historically redirects flows toward gold. Provided $4,400 holds on a closing basis, the macro bull case remains intact.

🥈 Silver & COMEX

COMEX registered silver inventory has fallen from above 160 million ounces in November to 75.9 million ounces today, less than half in five months. Open interest for May delivery currently represents ~364 million ounces against those 75.9 million registered ounces. Last May, 75.6 million ounces were physically delivered, almost exactly the current available inventory. If industrial buyers step in for physical delivery rather than cash settling, the registered buffer compresses toward zero. Shanghai silver is trading at ~$79/oz against COMEX's ~$70/oz, reflecting the ongoing physical drain to Asian buyers. The $60 level remains the line to watch: a closing break below it with lower highs opens the door to the mid-$50s.

₿ Bitcoin

Bitcoin is testing $65,000-$66,000, continuing a pattern of lower highs and lower lows since the cycle top. On April 2, a session where equities, bonds, and oil all closed higher together, Bitcoin declined. The failure to participate in either an inflation-driven rally or a risk-on move captures the bear case concisely: the market is not treating BTC as an inflation hedge, and it is not chasing it as a risk asset. For trend reversal, Bitcoin needs to break above $71,000-$72,000 and establish higher lows, a process that historically requires liquidity improvement, leverage flush-out, sentiment exhaustion, and time. The working timeline for a potential base is Q2-Q3, but current price action confirms nothing yet.

That’s all for this week, happy Easter, have a nice weekend, and see you next time!

Best,