What if the US won the war, but Iran can't surrender because no one is in charge over there? To make a deal, President Donald Trump needs someone to deal with. He was hoping to strike a deal this week in Islamabad, but the Iranians declined to meet because they are too busy fighting among themselves. Indeed, Trump, today, said that he extended the ceasefire because "the Government of Iran is seriously fractured, not unexpectedly so," a reference to US-Israeli assassinations of many of the country's leaders.
That seems to explain why President Donald Trump decided to extend the ceasefire indefinitely today. So, the US continues to blockade Iran's ports, while the Islamic Revolutionary Guard Corps continues to effectively close the Strait of Hormuz. The Iranian's figure Trump is setting them up for another surprise attack. They might be right. Or else, Trump may view the current situation as an acceptable status quo for now.
If so, that means that oil prices will remain higher for longer than Trump predicted. On the home front, higher-for-longer gasoline prices could raise concerns about consumer spending and the sustainability of the stock market rally. Nevertheless, we remain optimistic about the resilience of the economy and corporate earnings.
Consider the following:
