Peace proposal failed ! War to break out again? Stock Markets to Crash!

Added: 2026-05-11

[00:00:00]Ladies and gentlemen, President Donald Trump has earlier warned that if Iran does not accept his one-page memorandum of proposal, he's going to strike them.

[00:00:12]Well, guess what? Iran has already rejected it and also counterpropose with a set of demands that they want their heaven and earth away from what Donald Trump wants. So, does it mean that war is going to resume? Let's just watch on as I give you the analysis.

[00:00:30]So, is peace going to slip away again or war is going to return and are we going to have a bad outcome over again for the oil market and the stock market? So, the backdrop of this is that the Iranians have actually gave Donald Trump a counter proposal and Donald Trump was very unhappy about it. So, looks like we have all hoped that there will be a shortcut to this oil crisis, but looks like that's not going to happen. This is likely going to be a protracted long uh energy war. And I think uh this is not going to be good news for the oil market and the and inflation and eventually for the stock market as well. What the financial market has always expected is that this whole conflict will be a short conflict.

[00:01:24]They have hoped that there there'll be some kind of a diplomatic breakthrough.

[00:01:29]But guess what?

[00:01:31]This is not happening. So negotiations are still not having any breakthrough.

[00:01:36]They are still world apart in their demands. And right now drones incident are increasing. Warships are still moving. block it or block it is still there and oil prices is coming up again.

[00:01:48]So Donald Trump has rejected Iran's counter proposal and he called it totally unacceptable. That's largely because the Iranian terms are very difficult to accept. So Iranian wants compensation for war damage. They want sovereign control over the streets of Horos. They want full sanction relief and they want release of frozen asset.

[00:02:10]And most importantly the uranium no no no is still under our control. So as a result it's just uh not able to come to an agreement and the escalation path is likely to happen moving forward. So the Iranians say that we'll never bow and never surrender to the Americans. So the Iranians warn of surprising options if they are being attacked. So threatens a decisive response to any foreign warship that will come. Right now the French and the British warships are reported to be sailing towards Middle East and the Iranians have all right told them don't you dare come forward. So that's something that could potentially escalate the whole situation. So the Iranians are clearly not giving in to foreign pressure, not to Americans, not to any other kind of forces and clearly they are also continue to strike small little attacks on UAE and so on. So this is not a good news. So Prime Minister Netanyahu have basically came out and say that Iran's uranium must be taken out. He made a statement saying that the war cannot end until Iran's enriched uranium stockpile is being removed.

[00:03:34]There is still more work to be done.

[00:03:36]This whole war broke out because of Prime Minister Netanyahu. He basically influenced manipulated Trump to attack Iran and to remove he wants to remove an existential threat from the Iranians because the Iranians have a nuclear power and building towards possibly a nuclear bomb or nuclear missile. He's really very concerned about this and basically he outright say that you know we will not accept an end to this conflict until their uranium is being removed.

[00:04:11]Meanwhile, the streets of Homos continue to be blocked. So there are two blockages. So there's the Iranian blockage and the American blockage as well. So right now nothing gets passed.

[00:04:24]Well, there are there are pockets of of tankers that gets through I suspect because they paid for it. They pay the Iranians and they allow to set sail. Uh so this is something that is still a trickle. Uh I've always said that if money can solve problem let let money be the solution. Uh but unfortunately I think the whole world is taking a position that the streets of Hos is an international waterway. So it cannot be blocked in this way. Meanwhile oil prices are going up again. WTI prices is going up. Brand crude is going up again and the supply disruption is continuing. So we are continuing to see uh things are not moving well. Strangely or surprisingly, the equities remain very calm. The Asian equities still remain strong, especially the Korean one went up really skyhigh.

[00:05:20]And uh I call it a BTJ. Okay, BTJ is a short form for Bai is a Hawin phrase that says everything is okay. So I would just say this. There's a saying by an analyst that says as long as AI booms to hell with Middle East. So they are really pricing in a situation where Middle East whatever happens I think the stock market can handle it as long as we got the AI boom and the AI boom is genuinely strong and serious. I buy that. Now whether that's enough to fully cushion all the negative impact of the Middle East war, I think it's difficult to say. Now the question really is how high oil prices can go. Right now it's trading $90 to $110 or so. It goes up and down. But if there's going to be a standoff, it could go as high as 110 to $120, maybe even to 130 or so. But if there's going to be an escalation, more strike, Donald Trump lose his patience, or the Iranians lost their patience, go all out, then we're going to have a allout war again. Then oil prices will go up a lot. When oil prices go higher and higher, it sets off what I call a stackflation. This is something we all fear. There's an inflation together with a fall in uh economy. So that's causing economic growth to be stagnant. So the combination of two is called stackflation. And as time goes by, this possibility is getting more and more possible and more and more serious. And all central banks are most afraid of speculation because they do not have the right tool to deal with speculation. So, President Donald Trump is set to visit China and meet uh President Cinping and this will be a very very big uh very very big occasion. Now in this meeting of course we should expect Trump to pressure Singping on Iranian oil ties some of the sanctions and possibly tell China please do not support the Iranians and also ask China to be a mediator to deescalate the situation. So I think at this juncture siting Ping would like to signal that he's a neutral person and of course he wants peace to prevail and so on. But I would just uh I would just say that at this juncture uh China needs Iranian oil and to say that to ask Beijing to completely cut off Iranian oil purchases I think is that's going to be very difficult. Fortunately uh China is one of the fastest adopters of alternative energy uh energy usage and also okay they have huge storage of oil so they are not that worried but whether ceing Ping will oblige to President Donald Trump is hard to say.

[00:08:24]Interestingly, this also means that for this few days, it is very unlikely that the Americans will strike the Iranians because you know they don't want to be situation that they have to conduct the war from China. That will be very complicated. So, as long as President Trump is in China, I don't think there will be an outbreak of war after that.

[00:08:48]Hard to say. Well, another interesting phenomena is going to come out is that the inflation numbers throughout the whole world major countries will be will be appearing soon. That means they'll announce all the inflation numbers and we will see how stock market reacts to those inflation numbers. My guess is that inflation will go up. What I'm not sure is go up by how much. If the inflation number shoots up tremendously high then there will be even before the central banks come out with coping mechanism in the monetary policy uh the market will already have a reaction but if the inflation numbers rise marginally then maybe the stock market won't have a negative impact. So we would like to we would like to see uh a inflation numbers there's more there that's rising but not rising so much there is it's a foregone conclusion that that will there be higher inflation of course. Okay it's a foregone conclusion.

[00:09:53]So in closing will war break out again the answer is possibly not in the near future. meaning that from now all the way to the meeting between President Xi Jinping and uh President Trump uh that meeting has to be over soon before they will resume any battle if there's ever an intention of that. So hopefully within this period some breakthroughs might happen and and then you know energy energy prices could then come down again. Well, if it's not, then this thing will just continue to drag. Uh even a no war but no peace situation is going to be bad in the long run. So now whatever the situation may be if the AI boom is so strong and impact then it will the market will probably ignore this oil impact but it cannot ignore forever because if the oil prices keep going up and up and up at some point of time something have to break. So let's just watch on. This is a development.

[00:10:59]They are changing by the hour, by the day. So please hit subscribe so that you not miss any of this outbreak of news and I'll update you in the live stream.

[00:11:09]Thank you and goodbye.