The US equity market will ultimately be backstopped by the Treasury and the Fed through money printing and the creation of a sovereign wealth fund that directly buys US companies, because monetizing the debt and supporting equities is the only way out of the structural debt, populism, and financialization problems. This will drive massive asset inflation and support equity prices.
The US government's ability to control domestic oil prices (WTI) while global Brent prices rise due to geopolitical tensions and Strait of Hormuz disruption will cause the Brent-WTI spread to widen significantly, making the spread trade an easy directional play.
The US government's ability to control domestic oil prices (WTI) while global Brent prices rise due to geopolitical tensions and Strait of Hormuz disruption will cause the Brent-WTI spread to widen significantly, making the spread trade an easy directional play.