Ron Burgundy is the character played by Will Ferrell in Anchorman.
This quote has been cited many times since Donald Trump was inaugurated as US president in January.
Trump is stepping in to where previous presidents were afraid to. From trade wars and tariffs to NATO’s disengagement, and refusing to help Ukraine expel its Russian intruders.
He certainly added a cherry to the cake when, last weekend, he surprised the world with his decision to authorize US airstrikes against Iran’s nucleonic facilities.
This surprise was predictable at first, but it did not last.
US index futures fell on Sunday evening, while WTI crude and Brent crude reached their highest level in five months.
The US dollar has finally recovered after a turbulent six-month period that saw the Dollar Index fall to its lowest point in more than three years.
How quickly these initial moves unraveled. Only a few short days after, the price of crude oil was at its previous levels before Israel’s attack on Iran in June.
The NASDAQ 100 had soared beyond its previous all-time record from February of this year. Meanwhile, the dollar rallies was stopped dead in its tracks by a reversal triggered a few dovish comments from FOMC member Chris Waller.
Overall, the US bombing raids made the entire world safer.
Massive ordnances dropped on Iran’s nuclear underground facilities ensured their destruction.
According to Mr Trump’s claim on Monday, these bombs caused the ‘total destruction’ of nuclear sites. This would mean that Iran’s nuke programme will be gone for many years.
The dollar dropped, the oil price fell, the precious metals declined, and stock indices rose. It was once again hidden in the lower right corner of the graph.
Then, a US spy report leaked by the CIA suggested that US airstrikes did not ‘obliterate” Iran’s nucleonic facilities.
This early estimate suggested, instead, that Iran’s nucleonic ambitions may be set back only a few weeks by the damages inflicted.
This report should raise serious concerns if it is true and accurate.
This opens up an array of options for the next step.
The possibility that Donald Trump played the game and was trumped is very disturbing.
Was this report alarming to investors? It didn’t worry me at all. The risk assets ignored the assessment of intelligence and did what they love: go up.
The S&P 500 appeared to be on the way to a new record high at the time this article was written.
The bond markets are calm, with yields on 10-year Treasury Notes returning to lows seen last May.
All seemed well as long positions were reduced in currencies that are considered safe havens, such as the Japanese Yuen and Swiss Franc.
The Iranian issue has now been put on hold, at least for the time being.
Their retaliation towards Israel certainly suggested they were incapacitated military-wise, but both sides did not attack oil infrastructures, thereby removing the risk premiums from the crude prices.
Then, investors may now be focused on one factor that has the potential to have a profound and long-lasting effect on global economic growth: Trump’s Tariffs.
News about tariffs continues to filter in. Accordingly, US ports are seeing an increase in Chinese cargoer traffic in advance of the 12 August deadline for China’s tariffs.
It is an indication that the companies are prepared for future trade disruptions.
Tariffs on US imports will increase to “reciprocal levels” if the rest of the world does not reach an agreement with Trump’s administration by July 9.
No one is bothered. “Trump Always Chickens Out”, along with “Buy the Dip”, has become the new investment mantra of the modern age.
David Morrison, Senior Market Analyst for Trade Nation. His views are his. )
The post Boy! That escalated fast! This post may change as the updates unfold
This site is for entertainment only. Click here to read more
