Ed Elson

We've had tariffs plus this.

And it appears as though the Fed might be interested in even hiking rates.

That is increasingly becoming a probability.

What do you think this means for the Fed and the Fed's decision?

And how might that affect asset prices moving forward?

The more you game theory this out, and we talk about how this will affect inflation and what the decisions that this leaves for the Fed...

It basically leads to recession.

I mean, unless we can keep inflation under control and get prices, get those numbers downward, it does seem that that is kind of the trajectory we're headed.

You said that a recession would be more than likely by the second half of 2026, unless the hostilities ended.

Yeah.

I guess the question is, how does what's happened this week update your recession forecast and your probability that we would enter a recession?

Right, and that's the part that is so interesting, watching investors and watching the markets try to price that in, because the way, I mean, it's almost like, I just think about the way I'm thinking now.

I mean, at the beginning of the week, I didn't think we were actually gonna drop a nuke on Iran, but I was like, well, it's a question that you have to take seriously, because the guy did threaten it, and he said that it would probably happen.

And so I didn't actually think that, but that was something that was in my head.

And now, as we get to the end of the week, I'm sitting here, and in my own mind, I'm just completely preoccupied with completely different things.

The entire conversation has changed, and yet one thing that remains throughout all of this is that the uncertainty and the volatility and the erraticism of the guy remains incredibly high.

And so the idea of saying, oh, okay...

It's solved now, probably, slightly.

That also seems crazy.

And I wonder if... I think you make a good point about the insurance premiums in the Strait of Hormuz and the way that that will affect prices moving forward.