It's hard to see how the Iran war ends, says Evercore's Roger Altman

Summary

• Identifies two colliding cross-currents: a fundamentally strong U.S. economy pre-conflict and the unpredictable "wild card" of the Iran war.
• Notes most macro forecasts have baked in a ~30-day conflict duration, explaining limited equity market weakness to date.
• Highlights the critical closure of the Strait of Hormuz, through which 20% of global oil exports pass, and sees it as difficult to reopen militarily or via negotiation.
• Argues the U.S. economy is resilient, being a net oil exporter and with consumer spending on gasoline below 5% of disposable income, limiting direct damage from the conflict.
• Believes if the war ends soon and oil supplies return, the U.S. economy will end the year in good shape with oil ~$70 and gasoline prices only ~$0.25 higher.
• States there is no immediate advice for clients to act differently, as the conflict has not yet reached a point of truly impacting economic conditions; a reassessment would come only if evident damage emerges over 2-3 months.
• On AI: Believes it will be "very transformative" but thinks market focus on what it will destroy (e.g., labor) has gone "a little bit too far" and sees no evidence yet for apocalyptic impacts.
• On Software: References 5 sharp corrections in software stocks over 20 years, with most bouncing back each time, implying current AI-related fears may be overdone.
• On M&A: Says deal-making activity has not yet diminished, as the prevailing expectation remains for a short conflict.