Fear of an war-driven inflation shock is overruling everything else in markets right now

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• Market fallout from the Iran has been as expected, with one key exception.
• A sell-off in ultra-safe Treasury bonds shows that inflation worries are overruling everything else right now.
• If the Middle East sees prolonged disruptions, limited oil supply could lead to an inflation shock.

Up to this point, the market fallout from the Iran war has mostly gone as expected.

Oil spiked as much as 17% across two days as tanker...