Bob Elliott
· Nonconsensus
· March 18, 2026 at 10:30
· ⏱ 3 min read
| Read on Substack ↗
Summary
The author observes that since the start of the Iran War, US markets have been pricing in no negative growth impact from the sharp increase in oil prices. This is peculiar, as oil shocks historically create a drag on real spending and a surge in inflation, making for a challenging macroeconomic environment.
•US markets are pricing in no growth drag from the recent spike in oil prices.
•Market pricing even suggests the potential for marginally stronger growth.
•Historically, oil shocks are challenging for the economy, dragging on real spending and increasing inflation.