Ten31 Timestamp: Cui Bono?

**Marty Bent** (0:00)
Mr. Arnold, welcome back to the show. A little weak hiatus there for very good reasons, but we're back. And a lot has happened over the last two weeks, sir. A lot has happened since I woke up this morning.

**John Arnold** (0:12)
Yeah, no kidding.

**Marty Bent** (0:14)
Sending out true social posts, markets moving pretty aggressively this morning. But let's take a step back and put ourselves in your mindset, in your writer's seat. You titled the newsletter, the timestamp this week, Cui Bono. Who benefits from all this? What's happening here? Yeah.

**John Arnold** (0:31)
I mean, it's a question that's very much on my mind and I hope the minds of others over the last few weeks. When you've got things like the snip-snap Michael Scott approach to foreign policy and how to handle what's going on in the Persian Gulf, it's helpful to just step back and try to frame it as who's actually benefiting from the different ways that things are playing out of that could play out.
I wrote about that, tried to reason through a little bit of that in the timestamp this week, standing on the shoulders of people who are much smarter than me and much better informed. I know we can get into that, but as just a table setting comment, it really feels like the news are this week was response to, like, it feels very much if you're scrolling the timeline, if you're watching the clips on Meet the Press or someone off Fox News, your options for processing all this are basically like, you know, rah rah, we're going to destroy the most evil regime in the world, and we can't let Iran have a nuclear weapon, and you're, what, are you not a patriot if you don't want that to happen? You got that. And then you've got Trump is a complete moron, and he alone is guiding every element of foreign policy and every decision that's being made, and he has no plan, he's going to get us all killed, and it's World War III, and so, you know, sell everything, and there's no hope and no strategy at all going into this. Those... And China is going to win everything as a result. You know, the world... The US will destroy its position in the world, and the China will, you know, take its place. And so, there's kind of like the Mark Levin approach and like the Ray Dalio approach, and that's like basically all we have been given by the mainstream press. And I feel like there's a lot more nuance at play, which I don't pretend to be smart enough to fully reason through entirely, but that's what I was trying to maybe think through a little bit, you know, the newsletter this week.

**Marty Bent** (2:16)
Yeah. No, I recorded with Tom Luongo late Friday night, so I think that's a little bit more in the middle. He's got a very specific theory that we're not going to dive into here if you want to listen to that and get a TFTC and get it, but I think Fog of War. And I've consistently had to remind myself of this over the last three, four weeks is try not to make any shoot from the hip decisions or react too emotionally to the headlines, the pundit talking points or the true social posts that come out because we're truly in the fog of war. And speaking of true social, I think just to make sure we're staying on at the task of the show, which is topical news, to fill you all in on how we're reading this. I mean, we have true social posts from Saturday and then early this morning. Many people are calling this a taco and an attempt to basically suppress interest rate yields and the price of oil so that markets don't go to haywire. But essentially going into the weekend, Trump said that Iran had 48 hours to open the strait or there would be some massive hits on their power infrastructure. And then early this morning, Trump came out and said there was productive talks both directly and indirectly with the Iranian regime over the weekend. A market scream, Bitcoin screamed above 71,000. It's still holding over that level. Right now, oil fell below, WTI fell below $90 a barrel. And then Iran came out rather quickly and said, hey, these talks did not happen. So what is your reading on this?

**John Arnold** (3:55)
Yeah. I mean, my only reading is that there is no reading, right? Like I let off with this because the fog of war is exactly the right way to think about it. And like you'll see people on both sides of that kind of general bifurcation that laid out. It's like, you know, when Trump says something that's totally credible and should be completely believed. And when Iran says something, they're just lying. Or when China comments on something, they're just lying or trying to manipulate or using propaganda tactics or whatever. And there are other people who think the exact opposite, right? Like anything Iran says is totally correct and accurate. And they're the ones telling the truth. And Trump has just made everything up. And I think we should all just be in the mode of everyone is, if you're part of my French bullshitting right now, it is totally to everyone's advantage in all elements of this conflict to create as much uncertainty and obfuscation as possible. So that should, to your point on asterisks, leave just like, leave everyone with a lot of humility on what's actually happening. And yeah, I guess I would just say, let's try to be equally skeptical of the various posts and the mere words coming out of all the different sides of this conflict. But that, you know, so that just frames everything up. The one thing that I, is maybe less, maybe a good place to dig into like the meat of the newsletter, is actually like a more objective data point, is just the spread between WTI and Brent, Brent Crude. You mentioned WTI went below 90 I haven't checked Brent this morning, so I don't know where exactly the spread is shaking out today as of Trump's semi-taco or not taco, depending on how you think about it. But to me, this was kind of the story of the week, as it relates to trying to parse through what's going on and what the actual goals are and constraints are. This pretty remarkable move, which may or may not be sustained, but I think everyone got a good reminder last week that it's easy to forget in times of relative tranquility and especially like world is flat globalization, but oil is not like a globally homogenous market. It commands different prices in different places for different grades and different benchmarks. There are people again who are way smarter and more in the weeds on all the nuances of the global oil market than you or I. But this is just a good summary chart to show that violent reminder that we got. WTI is a US-based benchmark mostly for consumption here domestically. Brent is mostly a benchmark for Europe, Middle East, and Asia.