Iran War Will Cost Every Household $50,000

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**SPEAKER_2** (1:31)
Or at adobe.com/do that with Acrobat.

**Ed Elson** (1:35)
Today's number, 4.5.
That's how many gallons of alcohol the average Romanian male drinks each year. That's roughly 70% more than the average American, but it's 70% less than Cash Patel.

**SPEAKER_2** (1:53)
Money markets mad.

**SPEAKER_1** (1:54)
If money is evil, then that building is hell.

**Ed Elson** (2:03)
Welcome to Prof G Markets. I'm Ed Elson. It is April 21st. Let's check in on yesterday's market vitals.
The major indices fell as relations between Iran and the US remained strained ahead of the ceasefire deadline. Oil prices rose, but still remained below $100 a barrel. Shares of Fermi, the AI data center company that we predicted back in October would implode, plunged 20% after several top executives, including the CEO, resigned. And finally, Apple stock dropped roughly 1% after hours on news that Tim Cook is stepping down in September. He will be replaced by Senior Vice President of Hardware Engineering, John Ternes.
Okay, what's happening? The US Iran ceasefire expires tomorrow and tensions are mounting. Both countries' delegations are headed to Pakistan to engage in talks ahead of the deadline. President Trump said it's quote, highly unlikely that the ceasefire would be extended if a deal was not reached before Wednesday. He also said the US would continue to blockade the Strait of Hormuz until a deal is signed. And the meeting follows an active weekend of fighting. On Friday, Iran announced it would reopen the Strait of Hormuz after Israel and Hezbollah agreed to a ceasefire, stocks soared to record highs on that news. However, Tehran reversed course after the US refused to lift its own blockade. Then on Sunday, the US Navy fired on an Iranian cargo ship, and Iran threatened retaliation. Oil prices rose yesterday and stocks slipped. So, here to give us the update on the war and what it means for us and for the economy. We're speaking with everyone's favorite, our favorite, Justin Wolfers, Professor of Economics and Public Policy at the University of Michigan. So, Justin, the ceasefire might end tomorrow. That's at least the deadline.
I mean, there's a lot to get into, but I guess my first question is, does that even matter? Because this weekend, we heard from Trump that Iran violated the ceasefire, Iran said that we violated the ceasefire. We saw this news where we actually did fire. I don't know, Iranian, an Iranian cargo ship. So I just can't tell if this is even meaningful at all. What do you make of it? Does this change things for you?

**Justin Wolfers** (4:34)
Yeah. I think none of us can make anything of anything. So I want the audience to feel really good about themselves if they feel lightly confused right now. Now there's a reason we've always felt lightly confused about the Middle East, which is it's a long way away. If you miss a day in the news cycle, 17 things happen. Some of the words and the places are very long. It's not central to our lives. Many of us lose track of many Middle East stories. In fact, I've been trying very hard to keep track and not let anything go by. Still I'm confused because we have one extra layer that we don't normally have, which is we have no idea what the truth is.
I'm not being funny.
There was a time when someone said the following is a red line, you would understand it to be a red line. There was a time when someone said these are the conditions, you understood it to be the conditions. There was a time when someone said we've reached an agreement, you would understand that they'd reached an agreement.