Israel v. Iran gets strangely polite, the US House remains largely pointless
Commodities look good, though...
Reports are that an Israeli response to Iran’s direct, but slow-motion bombardment over the weekend will happen – but it is likely going to be limited in scope and target Iranian assets outside the country. And Tel Aviv has plenty to choose from. The Israeli government was at pains to explain to its Arab neighbors that their security would not be threatened. This will leave Iran’s domestic terrorism headache in the hands of ISIS-K, who have also claimed responsibility for the concert hall attack in Moscow.
An Israeli attack on Iran’s foreign assets, sadly, is pretty much a return to normal for both countries in the tit-for-tat violence they call co-existence. US sanctions on Iran are coming, per Treasury Secretary Yellen, but we’ve already hollowed out that option. On cue, Hezbollah launched an attack in northern Israel that wounded at least 14 Israeli soldiers. As standard foreign policy, it’s lively as hell, but generally seems to generally hold – until it doesn’t.
Two men have been arrested in Germany – one of the largest suppliers of military aid to Ukraine - for planning to sabotage arms manufacturing facilities at Moscow’s direction. Russia continued its bombardment of Ukraine, killing at least 16 people in the Northern city of Chernihiv. For his part, on Monday Vlodymyr Zelensky made a direct appeal to the US Congress for aid to get off its ass. More words to that affect.
House Speaker Mike Johnson said that he would… sort of. Johnson has been trying to peel apart the issues of aid to Ukraine, Israel and Taiwan into different bills to avoid the far-right (opposing aid to Ukraine) and the far-left (opposing aid to Israel) from forming an unholy alliance to sink a unified bill. A combined aid package of $95bn was passed by the Senate, which is opposed to separate bills. Johnson promised a vote on Saturday, while his own party chews on throwing him out of office to select a fourth speaker this year.
Which would explain why the stock market’s “fear gauge” is way up, according to people who say that sort of thing. With the aforementioned Russia hammering Ukraine as it prepares for an offensive push this summer, and Israel v. Iran half-heartedly aiming for their awful version of normal, it does look like it’s going to be a hairy ride. Best bet is to generally hold tight and have a drink as higher-for-longer rates looks likely too. Bonds will stay strong if your money wants to come in out of the rain.
As for commodities, fossil fuels and energy plays look good if for no other reason than there are a high-strung matches around all that gas – it’s hard to think that the prices are coming down anytime soon. Supplies are good, but so it the potential for disruption. Since new sanctions on Russia were introduced on 13 April, the price of base metals have jumped on the London Metals Exchange (LME): Aluminum up and Nickel are both up, along with Copper, which has gained 15% this year. All Russia metals are banned from LME warehouses which as of last month’s made up 91% of the aluminum in LME warehouses.
The Ukraine Equation: Framed so that a Congressman can understand.
Richard Murff is the founder of 4717 Insights. For more on the world, how it got here and a stiff drink, head to the 4717. Murff is the author of Pothole of the Gods: On Holy War, Fake News & other Ill-Advised Ideas, Drunk as Lords, and the upcoming World War III Has Started… Dress Accordingly.