THE FUSE IS LIT: Trump STUNS world by latest Iran military call

Hinzugefügt: 2026-05-19

[00:00:02]President Trump puts Iran strikes on ice, but the fuse is still lit.

[00:00:06]Meanwhile, the earning sugar rush on Wall Street may be over as optimism collides with geopolitical reality.

[00:00:13]Welcome to the Big Money Show. I'm Taylor Riggs along with my co-host Egg McDow, Lasses, Jackie D'Angelus, and Fox News uh Fox Business senior correspondent Charlie Gasprino will be joining us shortly. So, President Trump revealed that a major US military strike on Iran planned for today was called off after a lastminute appeal from the leaders of Saudi Arabia, Qatar, and the UAE. Their message, give diplomacy one more chance.

[00:00:42]>> I put it off for a little while, hopefully maybe forever, but possibly for a little while because we've had uh very big discussions with Iran and we'll see what they amount to. I was asked by Saudi Arabia, Qatar, UAE, and some others if we could put it off for two or three days, a short period of time because they think that they are getting very close to making a deal.

[00:01:07]>> But the president said if talks collapse, the US military is ready to launch a fullscale assault on Iran at a moment's notice. The White House still betting that Operation Economic Fury, a naval blockade that has diverted dozens of ships since April, can force Iran to the table. Wall Street today not so sure. I want to end on Wall Street and then I want to circle back um on Iran with you, Jackie. But first up, Dean, special treat. Top of the A block chart of the day. Let's do it. uh combination uh G7 bond yields are at the highest since I think it's 2004 or 2007. So we are back up a combination of all of these. The 10-year now approaching 5%.

[00:01:54]I'm you know I think my question is maybe E all of the above but A inflation B persistent large government deficits three end of central bank QE or D investors now bracing higher term premiums amidst deglobalization and and again inflation premiums that are rising. So I'm kind of wondering if that's all related again back to Iran the equity markets. Definitely.

[00:02:24]>> So the term premium that you started seeing at the start of the Iran war and I promise everybody I will try to keep this short that at this this is the onetwo punch of higher inflation and more borrowing from the Iran war. And the question is uh how quickly do those two concerns dissipate if at all once this conflict is over. So the higher term premium in essence investors demanding more compensation to hold duration that was what drove longerterm interest rates a little bit higher at the very beginning of the war. It's like more supply is coming. uh the debt deficits will worsen because of the spending overseas or so we're going to demand uh more to hold these longerterm bonds that already started and so the supply expectations started going up and then energy prices were going up, inflation expectations were rising but what and Stephanie Palmboy I was talking about this yesterday um emailed me and said, "I have a slightly different take on long rates based on when the deficits were worsening. It's definitely a factor."

[00:03:46]That's been the case from the moment we went into Iran and President Trump immediately asked for another, you know, four $1.5 trillion in defense spending for a annual budget. But the long end has blown out yields to the upside because it's being driven by the outlook for the deficit because there has evaporated the chance that the Federal Reserve will cut interest rates. And that is important because so much of our borrowing, onethird of our debt is being rolled over um annually on the short end. So the of the publicly held debt.

[00:04:29]So the Federal Reserve controls those borrowing costs. If the Fed's not if the Fed's on hold at a bare minimum and is not going to cut, what that does is it worsens the fiscal picture. It worsens the interest expense. And so it becomes this cycle of short rates staying higher or rising. the long end selling off harder and then tighter policy doesn't restore fiscal credibility. It worsens it through the interest expense and then you investors demand more and more term premium to hold the long end. Does this sell off end? I don't know. But not today. You've got like 14-year high on the 10-year Treasury right here. And everybody feels it because of mortgage rates.

[00:05:24]>> Yeah, Jackie. And I think so I come to you on trying to fold this into where we stand on Iran. Um if a 30-year borrowing cost goes to 6%, last time that happened was in 2000 and you think about if investors are looking at this as high inflation. You with the president who again called off another military strike trying to give diplomacy a chance. But I'm wondering if this is a market that is waiting and said, "I thought we did give diplomacy a chance a couple times.

[00:05:53]We keep calling off strikes. We keep keep hoping for the economic blockade.

[00:05:58]We keep hoping that the storage tanks will be full as long as they're not shipping oil on the rail over to China.

[00:06:04]And yet, the longer this goes on, and you've said duration, the long this is a market that's figuring out, well, now what? Now what? And so, I'm hoping you can help us answer that question.

[00:06:15]>> Yeah. I mean, the now what isn't great.

[00:06:17]So, I have a note written here that I want to read to you because I just want you to be proud of me for a moment.

[00:06:21]30-year 5.2% highest since 2007 19-y year highation.

[00:06:29]Round of applause.

[00:06:30]>> Now, tell us you read that in a research note and that would like win it all for >> I didn't. Um, but so that's what you know sort of my headline is today as well and it's gas prices and it's going into the holiday weekend and oil prices and the fact that we still don't have a resolution here. Um I generally stand behind the president and the administration and the decisions that they make. But I am wondering what happened after the China summit.

[00:06:53]Everybody kind of said we gave Iran enough chances to come to the table in earnest and and to do a you know a good faith negotiation which they were not doing and yet the president pulled back for some reason. Now, just before and I believe it was like in the transition of the 10:00 to the 11:00 hour, the president was standing um at the White House and he was talking to reporters um actually in front of his ballroom renovation answering questions about that, but many other things as well. And Iran was part of the conversation and and he says that he is at the ready. He could make a decision um and and that something could potentially be imminent.

[00:07:28]So, I mean, I'm waiting to see what happens here, but this does have to end because Memorial Day is coming. People are going to start to hit the road. The weather is getting nicer. They're going to start to barbecue. And this is when the creeping higher inflation at the supermarket and at the pump makes an impact. And what will happen is the longer that this goes with the duration as you head into the peak of the summer driving season, those prices will not go down overnight. They will not go down over the night. They will go down even with a shorter term resolution to this conflict, but it will take some time.

[00:07:58]And I imagine you won't see substantially lower prices until the fall or even the dead of winter. Now, that's after the midterms. That's a little bit late for this. So, something has to give here. Um, I understand the mission. I'm behind it. I want to see complete regime change in this country, but let's get on with it.

[00:08:15]>> Um, I do this for you. I'm scared.

[00:08:18]>> Blue. Nope. Don't worry. Not a chart of the day. Just another headline note. Um, oil fuges for December 2026 are reaching new intraday high. So, I think long term this is a market that thinks that this isn't going to be easily resolved. The good news though, and Jackie pointed out um those Trump comments when he was talking about China, they um the president said that President Xi has promised me that he's not sending any weapons to Iran. I take him at his word.

[00:08:45]I appreciate it. We had a good time in China. So, at least for now, if we take China at their word, they're not helping Iran. But it's this waiting game for economic fury to play out. And then how do you see wrap that into how the equity mark, you know, okay, we've been down for three straight days, but we're still close to record. So, sort of how do you reconcile the short term versus the long-term picture?

[00:09:05]>> I think it's a big bowl of spaghetti that's hard to unwind, right? I think Jackie is right. Duration always mattered here. You pointed it out. It's funny. I was looking at the oil futures chart as you were saying it. We now have an eight handle out to February and March of 2027. So, >> wait, so does that mean I win the bet?

[00:09:20]Remember, what was our bet?

[00:09:21]>> The temperature is 90. So, I don't know if we get a if we get a pullback and settlement this weekend, we might win.

[00:09:26]We bet that oil prices where they would match the temperature in New York. What month? May or June? I think you were July.

[00:09:33]>> But we digress to pull it all together.

[00:09:36]I think there's two things. It's a double whammy. There's wellfounded inflation fears because oil is now staying pushed up higher prices out and and Dan just shared a master class in understanding the term premium that investors are demanding now. So those two things are coming together and it's going to be a pressure point for the markets. I think the markets haven't collapsed yet for one reason and one reason only. Earnings have been unbelievably strong. Six quarters in a row of double digit growth. But that's the equivalent of how long can the consumer and these corporations hold the the bag for the markets and for the government. And I don't know that they can do that indefinitely.

[00:10:10]>> Can I add a China comment? Yeah. You've also got this summit with Shei going, I'm sorry, Putin going over to see Shei.

[00:10:16]This is after President Trump obviously had his summit last week. And I there's some concern for me there because it reminds me that some of these comments that are being made about Iran to the president potentially from a nation that has made promises before that it hasn't kept and it doesn't follow through with who now is is meeting um with another kind of evil world leader. And and I'm wondering what those conversations are going to be about and Putin possibly in my mind begging him and saying, "Don't buy oil from the United States. Buy more oil oil from us." Um and and kind of throwing a wrench in things. So, you know, I understand that everybody can talk to whoever they want to talk to, but the timing on this to me is a little odd. And you know, we don't trust China.

[00:10:56]I never trust them. So, I see something like this and I take it all with a grain of salt.