A weekly thread to discuss financial matters - from personal all the way up to global.
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Notes -
I continue to find myself puzzled by the economic fallout from the current situation in the strait of Hormuz.
Gas and diesel prices have spiked in the last few months, but not as much as I would expect, given the current level of transit out of the middle east. I understand that multiple governments are tapping their strategic reserves to mitigate the shock, but strategic reserves are a finite resource that must be refilled at a future date. An acquaintance in the industry has suggested to me that October is going to be an interesting time for diesel, and I don't understand why that possible future isn't priced in more.
What am I missing here?
The TACO trade. No one believes Trump will not just back down. Even if he is willing to burn the 2028 presidential election, a Dem congresd will present many more obstacles to tariffs and could probably find a lot of ways to make headlines about quasi-corruption like Trumpcoin.
The demand response to Hormuz, particularly from China, has been profound. It is very unclear if China is making the biggest TACO bet of all or if there really has been such a huge shift away from diesel/unleaded.
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