How Far will the Stock Market Fall Next Week

Investment Analysis Clubs Macro Economic Trends and Risks
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https://www.wsj.com/world/middle-east/trump-strait-of-hormuz-opening-iran-negotiations-b6a43ad6

For weeks, President Trump had been laying the groundwork to declare victory in the Iran war should Tehran fully reopen the Strait of Hormuz, even floating the idea privately to senior aides that he’s willing to walk away without a nuclear deal, U.S. officials said.

But that scaled-back objective became more difficult when Iran insisted Saturday on its highest price yet for permitting the free flow of traffic in the waterway, seeking billions of dollars in U.S. payments, the removal of American troops from the region and an end of the U.S. naval blockade, among other things.

  • But the recent chaos in negotiations signaled Tehran is prepared for a long and grinding conflict.*

“Iran’s recent hardline demands for reopening the strait make it increasingly difficult for the president to manufacture a face-saving off-ramp from the conflict,” said Mona Yacoubian, director of the Middle East program at the Center for Strategic and International Studies, a Washington think tank.

No way this conflict is over by election time.
The US is in for an extended period of time of economic decline until enough defensive missiles can be manufactured. And then the pounding of Iran can continue. I don’t see how the US can admit defeat. The loss of US prestige would be unbearable.

If Trump does admit defeat.

Then this would be the second US defeat in the Middle East. Russia was able to shore the Syrian government in 2013 causing the US government to back away from its attempt to topple the Assad regime.

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If we take a continental instead of Eurocentric view (like a book I’m reading now) the “Middle East” is actually southwest Asia.

That would include Afghanistan and Iraq as well as Syria. Not to mention Iran.

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Can anyone say that the U.S. “won” in Afghanistan or Iraq?

Seems like the military-industrial complex likes minor wars to keep the troops exercised and the factory lights on. I don’t think that “winning” is part of the equation, judging by past actions.

Wendy

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Oh I think winning is the objective, I just wonder how many more times the warriors at the Pentagon will have to learn “me big, you small” isn’t a guarantee of success.

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It is clear the Pentagon didn’t want this war. The Sec. of War (snicker) has been firing anyone who disagrees with him, and that’s been quite a few people so far. If anyone says “I’ve got a bad feeling about this…” they are out of there.

Between terms, the POTUS was recorded by a journalist displaying and discussing classified US plans for an Iran invasion, and lamenting the Gen. Zinni talked him out of it.

It was pretty obvious the POTUS wanted a war in Iran and now he has it. Congrats, I guess.

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That certainly is the military thought mode. But it is the bipartisan foreign policy of intervention that loosens the choke collar of the US military.

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I’m not getting it. Why would the schlock market fall this coming week? The war is already there. It is already “a thing” as the kids like to say. Trumpydoodle can jawbone it up, jawbone it down as needed. Unless Iran actually does something that matters it’s just another part of life’s rich tapestry we call “Situation Normal”.

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Iran has the ability to shut down your water supply or electricity on a large scale. If we weren’t able to bring stuff back online quickly, I think that might have an effect on the market.

intercst

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I know, they can do a lot of things. But will they and will it matter? They can do this do that… scare people up, scare people down. It won’t be the end of the world or anything else. As Dick Armey once said in a different context: We’re making a good living selling that mule back and forth between us. Now, via a vis the mid-terms… I do not expect significant changes one way or the other. People might like Trump a little less but it won’t change outcomes.

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The media is constantly spouting the current US regime propaganda that an agreement is around the corner. What happens when people realize that the Strait of Hormuz will remain pretty much closed for an extended period maybe even a year?

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Not much except an acceleration of “events” in this strange new world we have now inhabited for not even two years. So I think people are and for some time to come will continue in their varied current states of querelous pizzed off head scratching….

It will take a lot of death or incontrovertible displays of madness to break up the current log jam of obsolete attitudes and emotional squirrel cages. I sure hope it doen’t end with range of lemming rushes to various cliffs….. (yes, i know lemmings/cliffs is a legend, but humans are stunningly more loco when sharing delusions than lemmings)

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Iranian leaders say they won’t open the Strait until the US lifts sanctions, unfreezes its assets, and pays reparations. And then they intend to charge fees, along with Oman.

The Iranians appear to have two lines of thinking. First is the Strait is leverage, so they won’t give it up until they something concrete in their hands first. And they seem to think time in on their side. It is straining the US economy and the economy of our erstwhile Gulf allies. They longer they wait, the better deal they will get. And as we get closer to the mid-terms high gas prices will put pressure on the president’s party to cut a deal, which further increases Iran’s leverage.

https://www.nytimes.com/2026/08/08/world/middleeast/iran-us-oman-strait-of-hormuz.html

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I like the phrase “Gadarene rush” but not everyone gets the reference.

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I disagree. I’m pretty sure that Iran is going to keep the Strait of Hormuz shut down through the November election and beyond to impose maximum pain on Trump. All they need to do is lob an occasional missile at an oil tanker to keep the maritime insurance market closed – and no one sails without insurance.

I wouldn’t be surprised to see $10 or $15 gasoline prices on the West Coast which largely runs on Middle East refined products.

intercst

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Trump cannot admit defeat. That will NEVER happen. Perhaps tacitly but never openly. NEVER.

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The world’s on fire.

“I love the fire.”

“People say it’s the greatest fire like no one has ever seen.”

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Oh, perfect! as the allusions are parallel, and the Gadarene swine adds version adds some fine old school Demonic Possession that seems perfectl suited.

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Excellent point.

nly semi-negotiating with them. We are just watching Iran with its huge inflation and the fact they have no money,” Trump told Axios reporter Barak Ravid, comments that were taken as a signal that the US will continue the blockade and economic pressure against Iran but won’t launch a major military escalation.

I wonder if the president will watching the inflation within the USA due to high gasoline pricing that not only affect fill up cost but also the cost of food production and transportion of goods from ports.

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So much to say here:

It isn’t “the media”. It’s “the President”. They are quoting him (or other administration officials.) Sadly, that’s their job.

That would be vindictive but counterproductive. The Iranians have maximum leverage now and for the next month of two because of US elections. Once those happen the leverage goes away, because it’s clear he doesn’t give a patooty about “little things” and he will be a lame duck anyway, so “the next election” is irrelevant (to him, not to other party members, but they all answer slavishly to him, so: same.)

They can be vindictive, for sure, but they are not stupid.

Disagree with this, too. He doesn’t admit defeat, granted, but he can just declare victory no matter what the terms, and his base will follow. You think Fox News is ever going to do a dissection of a losing agreement?

Frankly, I expect him to come to the realization that the MOU of June was about as good as it’s going to get, and to try to get back to that, and to do it timely. (Yes, it’s 1,000 time worse than the one he tore up, but so what?)

It takes a minimum of 30 days, more like 60 for oil prices to react and prices at the pump to come back down. (I think it will be too late to re-re-rechange most minds, but again so what?) If he’s to react to election pressures, and he’s getting lots of it from his own party, now’s the time - or at least in the next couple weeks.

My prediction:: it’s the Vietnam solution. Declare victory (even when it isn’t) and go home. He will be forced to give Iran everything they want. Period. Total fail. Coming soon to a headline near you.

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I disagree. Iran can continue to punish the USA via oil that also affect food production & transportation of goods within the USA. Which means less disposable income and increased inflation.

That’s no longer on the table. I believe Iran wants to impose a really embarrassing treaty upon the president. Such that he cannot declare victory.
The house has passed a resolution to remove U.S. forces from hostilities with Iran. Similar action has failed to pass in the Senate. That could change after the election.
A Democrat Congress could reject any further funding for the war.

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And they could invoke the War Powers Act, giving the president 30 days to end hostilities. Which the POTUS certainly will ignore, invoking a Constitutional crisis.

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