Bonds are prized for offering stability in an asset‑allocation strategy, providing an offset to the higher risk in stocks, particularly during periods of market stress. But since the Iran war began, fixed‑income securities have had a rough ride as markets struggle to assess whether the conflict’s main threat is higher inflation, slower growth (if not recession), or some mix of both.
Iran War May Widen 10-Year Yield’s Market Premium vs. Fair Value
The inflation-driven spike in the market premium for the US 10-year yield in 2022-2023 has been gradually reversing over the last several years. But in the wake of the turmoil in the Middle East, which has raised energy costs and inflation, the pre-war calculus may be set for an attitude adjustment.
Book Bits: 11 April 2026
● Planet Money: A Guide to the Economic Forces That Shape Your Life
Alex Mayyasi
Interview with author via WVPB radio
Q: Give me the 30 second version. What is the economy? Why should I care about it?
A: I mean, first I have to give my favorite joke is that economists say economics is what economists do, because there is this way that it’s a little bit nebulous, and that’s what we’re referring to. But I think one answer is that the economy is humanity’s greatest invention. The economy is all of us pursuing our interests and values, training with each other, interacting with each other, working together. Sometimes when we don’t even know it and we just find it absolutely fascinating to try to better understand and learn how it works and share that with other people.
Momentum Factor Leads as Wall Street Bets on a Fragile Ceasefire
The tentative ceasefire between the US and Iran is holding as both governments prepare to meet for high‑stakes talks in Pakistan. The foundation for a peace deal may be wobbly, but the stock market is cheering: the S&P 500 Index closed on Thursday (Apr. 9) at its highest level in five weeks. Equity factors have also rallied, though results vary widely, with momentum posting the strongest gain based on a set of ETFs.
Q1 GDP Poised for Rebound as Fragile Ceasefire Clouds Outlook
US economic activity is still expected to rebound in the upcoming first-quarter GDP report scheduled for Apr. 30, but recovery from Q4’s stall-speed increase may face stronger headwinds in Q2 as the effects from the war with Iran reverberate in the months ahead.
US–Iran Ceasefire Takes Hold, as Fragile Peace Looms
The two-week ceasefire announced by the US and Iran on Tuesday is welcome news, but deciding if the threat of war has truly passed will take time. The peace may be fragile, but markets are already cheering this morning. The true test will unfold over the coming weeks. Here are some of the indicators I’ll be watching for determining if the worst has passed.
Fed Walks a Policy Tightrope as Iran Conflict Clouds the Outlook
The Federal Reserve is steering through one of the most challenging policy environments in years as the war with Iran destabilizes global energy markets and raises uncertainty about inflation and economic activity. The spike in geopolitical volatility leaves policymakers navigating an exceptionally narrow path: tightening too aggressively risks tipping the economy into recession, while easing too soon could reignite inflation. For the near term, the least worst option is to sit tight and leave rates unchanged until the incoming data start to make a strong case for changing the monetary policy bias.
Prolonged Stress Test Lurks for Global Markets as War Continues
Global markets are entering a sixth week of stress testing as the war with Iran continues with no immediate resolution in sight. The main risk factor remains the closure, or near‑closure, of the Strait of Hormuz, a strategic chokepoint through which roughly one‑fifth of global oil and liquefied natural gas flowed before the conflict began on Feb. 28.
Book Bits: 04 April 2026
● Recession: The Real Reasons Economies Shrink and What to Do About It
Tyler Goodspeed
Interview with author via CNBC
Q: You say recessions are unforecastable. What does that mean? There are a lot of people who try to predict them.
A: In a nutshell, it means recessions are about shocks, and they are shocks we can neither fully anticipate nor effectively hedge against. We have tools to predict recessions, like the yield curve. But when you actually test these tools on the historical record, there are a lot of false positives and false negatives. I’ll admit, I still look at the yield curve just to take a look. I’m not a believer in astrology, but I still take a peek at my horoscope now and then.
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Total Return Forecasts: Major Asset Classes | 2 April 2026
The war with Iran started over a month ago, and could run for several more weeks, according to President Trump’s address to the nation last night. The short-term effects for markets have already been substantial, and more turbulence is potentially brewing for the near-term outlook. But even a month of war has yet to meaningfully change long-term expected returns for the major asset classes overall.