Toby Hearst

The War, The Yield Curve, The Fed, Private Credit, and Gold

Mar 30, 2026 4 min read paid

I. The War Carl von Clausewitz, the Prussian general and military theorist, famously observed that "war is a mere continuation of politics by other means." He argued that war is never an end in itself. Instead, it is a tool used by states to achieve a specific political objective. Therefore, the military strategy must always be subordinate to the political goal. If the political aim changes, the military

Ed Yardeni
Toby Hearst

MARKET CALL: Stock P/Es Discounting Higher-For-Longer Oil Prices & Interest Rates

Mar 29, 2026 5 min read paid

The fog of war is getting thicker because of the likelihood of US boots on the ground (the "bog of war"). The US Department of War has deployed 15,000 troops to the war zone, raising the risks of a longer war and more American casualties, which will cause an uproar in the US. On Tuesday, March 3, we wrote: "We've been expecting a pullback

Ed Yardeni
Toby Hearst

ECONOMIC WEEK AHEAD: March 30-April 3

Mar 29, 2026 4 min read

This week will continue to be dominated by developments in the Middle East. On Friday, the US and Israel struck Iranian nuclear and steel facilities, with Iran retaliating across the Persian Gulf, while President Trump pushed back a deadline for Tehran to reopen the Strait of Hormuz or face further attacks on its power infrastructure. The escalation marked a sharp shift in tone from earlier in the week, when the

Toby Hearst
Ed Yardeni

Thanks For The Memory

Mar 23, 2026 4 min read paid

We are taking a break from the war. We may wait until Friday to update our views on its likely impact on the global economy and financial markets. This morning, President Donald Trump triggered a relief rally in the stock market by postponing his threatened attack on Iran's power plants, scheduled for today, until the end of the week. He added that the US is negotiating with Iran.

Ed Yardeni
Toby Hearst

ECONOMIC WEEK AHEAD: March 23-27

Mar 22, 2026 4 min read

The week ahead is all about oil prices. As the Iran war enters its fourth week, the soaring price of crude has rapidly upended economic forecasts and shifted expectations for central bank policy. Nowhere more so than at the Fed. In barely a week, bond traders have swung from expecting rate cuts to pricing in roughly a 50% probability of a tightening move by October. In Europe, the financial markets

Ed Yardeni
William Pesek
Toby Hearst

Did Powell Trigger A Taper Tantrum In The Stock Market Today?

Mar 18, 2026 4 min read paid

The fog of war is back. Oil prices jumped today after Israel attacked Iran's largest gas processing facility. Iran's Revolutionary Guard threatened to strike oil facilities in Saudi Arabia, the United Arab Emirates, and Qatar. Qatar then reported that Iranian missile strikes had damaged a key liquefied natural gas export facility. Early this morning at 2:17 a.m. EST, the price of a barrel of

Ed Yardeni
Toby Hearst

Oil Shock Is Latest Test Of US Economy's Resilience

Mar 17, 2026 3 min read paid

The latest crude oil price spike has drawn comparisons to previous similar spikes (charts). There were six of them before the current one, since 1970. The first five coincided with recessions. The two during the 1970s caused two recessions and boosted inflation, resulting in a lost "stagflationary" decade for the stock market. The previous spike in 2022 coincided with a bear market in stocks, but there was no

Ed Yardeni
Toby Hearst

A Break In The Weather

Mar 16, 2026 4 min read paid

Forecasting the weather is easier than forecasting the timeline and outcome of a war. The expression "the fog of war" is a bit confusing because fog often lifts within hours. Wars last much longer. Today, we had "a break in the weather." The war is ongoing, but there were sighs of relief in the energy and financial markets. That's because some tankers are getting

Ed Yardeni
Toby Hearst

ECONOMIC WEEK AHEAD: March 16-20

Mar 15, 2026 3 min read

This week, many of the world’s top central banks have their first crack at responding to skyrocketing oil and gas prices driven by the war in the Middle East. Along with hearing from the Fed (Wed), we’ll get rate decisions from the European Central Bank (Thu), the Bank of Japan (Thu), the Bank of England (Thu), the Bank of Canada (Wed), the Swiss National Bank (Thu), Sweden’s

Ed Yardeni
Toby Hearst

Dire Strait Versus Home On The Range

Mar 4, 2026 4 min read

Oil prices stabilized today, so stock prices rose. We expected a pullback in the S&P 500 in early 2026. The S&P 500 fell 2.3% from its record high of 6987.60 on January 27 through Wednesday's close. It was up 0.77% today. Is the pullback over? If so, that's quite remarkable, suggesting investors believe Iran has lost the war and

Ed Yardeni
Toby Hearst

SWEET & SOUR: Iran, China, M-PMI, & PPI

Mar 2, 2026 3 min read

I. Hot war with Iran and cold war with China We remain in the short-war camp on the outlook for the current conflict in the Middle East. The stock market seems to agree, since it barely budged today, though defense stocks rose significantly (chart). Geopolitical crises tend to create buying opportunities in the stock market (chart). The problem is that everyone knows that, which diminishes the magnitude of opportunities! Following

Ed Yardeni
Toby Hearst

Will The US Economy Remain Resilient Despite AI Derangement Syndrome?

Feb 26, 2026 4 min read paid

If AI continues to disrupt, if not destroy, more and more business models, won't that cause a recession? It might if it triggers lots of white-collar layoffs, which in turn lead to blue-collar job losses (chart). Alternatively, it might cause a credit crunch in the private credit markets. UBS Group AG has raised its private credit default forecast, with its strategists warning that losses could reach as high

Ed Yardeni
Toby Hearst

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