In this episode, we shift the focus from oil headlines to the force quietly driving everything underneath: interest rates. Four weeks into the Iran conflict, markets remain locked on energy, but as Michael explains, it’s the surge in rates that’s doing the real damage. With the 10-year yield climbing, mortgage rates rising, and rate cuts rapidly priced out, financial conditions are tightening fast.
We break down the powerful link between oil and rates, why this supply-driven inflation shock is reigniting volatility. Michael also explains why tin he post-2022 regime investors are hyper-focused on inflation and rate risk. With stocks and bonds increasingly moving together, traditional diversification is breaking down.
Finally, we explore what history tells us about markets during inflation shocks, why oil spikes often precede economic slowdowns, and whether the recent resilience in economic data can last.
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