politics

NEW: Iran just responded to Trump's bombing raid by approving the closure of the Strait of Hormuz — a chokepoint where 1/5 of the world's oil flows

$BTC and $ETH are now tanking, stocks are likely to fall 📉

Here's why closing the Strait could become an economic disaster 🧵

The Strait of Hormuz provides the only sea passage from the Persian Gulf to the open ocean.

More than just passage for 1/5 of the world's oil, it also accounts for about 30% of the world's liquified natural gas supply

Closing the Strait will have massive economic repercussions

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Mainly, when the US is still reeling from a trade war and persistent inflation, an energy shock is the last thing the economy needs

The immediate effects would be higher prices.

Second order effects mean delayed interest rate cuts from the Fed, and slower growth as a result

President Trump has recently floated the idea of firing Fed Chair Jay Powell again — something most agree he doesn't have authority to do. (Removing Powell might actually trigger more market panic anyways)

Either way, Iran's response is likely to cause lasting economic damage

Highly unlikely Could Iran actually shut down the Strait of Hormuz?

Highly unlikely Could Iran actually shut down the Strait of Hormuz?

https://www.perplexity.ai/search/iran-s-parliament-approves-clo-mFZmHiIFTgObgv8NI01yTg