I have to agree. Trump and his minions having three more years in office are more of a risk to the world economy than a mostly air war that pasts a few weeks. Though we will see. Still a lot of unknowns..
The main global economic risk associated with the renewed war against Iran is an energy price spike. (Regional problems are very easy to see.) I discussed energy price spikes in Section 5.4 of Interest Rate Cycles: An Introduction. A very short-term spike would not matter that much, rather the risks are of an extended period of a reduction in energy exports from the region. Once again, political risks emanating from an erratic American executive overwhelms traditional econometric business cycle analysis.
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