Trump’s ‘economic D-Day’ claims first victim: Not Iran, but US markets
86/100
Verdict
High Trust
Largely Reliable — High Trust with Minor Imprecisions and Sourcing Imbalance
The article is a verbatim reproduction of an Al Jazeera news analysis published on 21 August 2026 ('Trump's economic D-Day claims first victim: Not Iran, but US markets', https://www.aljazeera.com/news/2026/8/21/trumps-economic-d-day-claims-first-victim-not-iran-but-us-markets).
✓ 22 checks out
✕ 1 disputed
? 7 unverified
Full analysis The complete summary ⌄
The article is a verbatim reproduction of an Al Jazeera news analysis published on 21 August 2026 ('Trump's economic D-Day claims first victim: Not Iran, but US markets', https://www.aljazeera.com/news/2026/8/21/trumps-economic-d-day-claims-first-victim-not-iran-but-us-markets). Targeted research confirms the overwhelming majority of its hard, checkable data points against primary and reputable secondary sources: the exact Dow (-703.84 points to 52,759.21) and S&P 500 (-0.87% to 7,641.16) closes on Thursday 20 August 2026; the US gross national debt crossing $40 trillion; the doubling of Treasury long-dated buybacks from $2bn to at least $4bn; the 30-year Treasury yield near a 19-year high above 5.25%; the UAE's indefinite trade embargo on Iran; Araghchi's 'diversion from America's own crisis' quotation; Senator Mark Warner's post on X; Trump's rally remarks on petrol prices; the EIA's early-2027 recovery projection; and the Reuters/Ipsos 33% approval rating matching his December 2017 low. Deductions arise from four categories of weakness rather than falsehood: (1) small quantitative imprecisions (Brent's rise was reported elsewhere as a three-week high, not 'nearly a one-month high'; pre-war Hormuz transits are typically cited as a range of 80 to 130+ ships/day, so '130' sits at the top of the range); (2) a temporal framing stretch ('just a few weeks to go' before elections held on 3 November 2026, i.e. roughly ten weeks after publication); (3) unattributed causal assertions (debt milestone arriving 'two years before expected' 'as a result of' war costs and corporate tax cuts); and (4) presentational imbalance — a single expert (Frédéric Schneider) supplies five of the article's analytical quotations, the only political voice quoted is a Democratic critic, and Iran's denial of the missile attack that triggered the UAE embargo is omitted. No claim met the evidentiary threshold for a 'False' rating.
What checked out (22)
- Trump posted on Truth Social that Iran had 'failed to take' the opportunity to make a deal and would face 'economic warfare and isolation on an unprecedented scale' — corroborated by CNBC, 19 Aug 2026 (https://www.cnbc.com/2026/08/19/us-iran-war-trump-hormuz-economic-warfare.html).
- Trump threatened 'TREMENDOUS Economic Consequences' for any country whose financial institutions, businesses, airports or government entities provide a lifeline to Iran — CNBC and CNN live coverage (https://www.cnn.com/2026/08/22/world/live-news/iran-war-trump).
- Treasury Secretary Scott Bessent has warned of further secondary sanctions on nations and entities doing business with Iran, and the campaign is branded 'economic D-Day' — CNBC, 24 Aug 2026 (https://www.cnbc.com/2026/08/24/us-iran-war-trump-hormuz-bessent-economic-sanctions-.html); NBC News (https://www.nbcnews.com/business/economy/bessent-iran-sanctions-d-day-rcna594103).
- The Dow Jones Industrial Average shed 703.84 points (1.32%) to close at 52,759.21 and the S&P 500 lost 0.87% to 7,641.16 on Thursday 20 August 2026 — CNBC market close report (https://www.cnbc.com/2026/08/19/stock-market-today-live-updates.html) and Rutland Herald index table for Thursday 8/20/2026 (https://www.rutlandherald.com/news/business/how-major-us-stock-indexes-fared-thursday-8-20-2026/article_a4b72e93-e4f8-59e1-ba48-25b4ba4e5b8f.html).
- It was the US stock market's worst day in three weeks — Northwest Arkansas Democrat-Gazette, 21 Aug 2026 (https://www.nwaonline.com/news/2026/aug/21/us-stock-market-plunges-to-worst-day-in-3-weeks/).
- Total US debt surpassed $40 trillion for the first time, per a Department of the Treasury update ($40.05tn recorded 18 August 2026) — CBS News (https://www.cbsnews.com/news/national-debt-tops-40-trillion-doubles/), NPR (https://www.npr.org/2026/08/19/nx-s1-5937552/the-u-s-debt-tops-a-record-shattering-40-trillion-yes-with-a-t).
- The 30-year US Treasury yield pushed above 5.25%, close to a two-decade high — CNBC reported it topping 5.33%, a 19-year high (https://www.cnbc.com/2026/08/18/treasury-yields-.html); Axios reported a week-end close of 5.26%, highest since June 2007 (https://www.axios.com/2026/08/17/treasury-yields-warsh-bonds).
- Treasury made an emergency move to double buybacks of long-dated debt to at least $4bn — CNBC, 20 and 24 Aug 2026 (https://www.cnbc.com/2026/08/20/bessent-says-treasury-buyback-operation-could-be-more-than-4-billion.html; https://www.cnbc.com/2026/08/24/bessent-1-trillion-treasury-general-account-bond-buybacks.html), which confirms the increase was from $2bn to at least $4bn.
- Foreign Minister Abbas Araghchi called the 'economic D-Day' 'a diversion from America's own crisis' — Jerusalem Post (https://www.jpost.com/middle-east/iran-news/article-906065), ABC News live updates (https://abcnews.com/International/live-updates/iran-live-updates-tehran-adopt-offensive-aspect-irgc?id=135700072&entryId=135798842).
- The UAE announced an indefinite trade embargo on Iran after accusing Iranian forces of firing ballistic missiles at its territory — Al Jazeera, 19 Aug 2026 (https://www.aljazeera.com/news/2026/8/19/uae-imposes-indefinite-trade-embargo-on-iran-over-alleged-missile-attacks); Times of Israel/Reuters (https://www.timesofisrael.com/uae-puts-financial-embargo-on-iran-after-missile-threat-targets-maritime-traffic/).
- More than 20 percent of global oil and LNG exports passed through the Strait of Hormuz before the war — Britannica (https://www.britannica.com/place/Strait-of-Hormuz).
- The Strait of Hormuz is effectively closed to commercial shipping, with only a handful of transits — straits.live tracker, 25 Aug 2026 (https://straits.live/); NBC News tracker (https://www.nbcnews.com/data-graphics/strait-of-hormuz-ports-traffic-trump-us-iran-war-rcna331507); CBS News (https://www.cbsnews.com/news/iran-war-strait-of-hormuz-not-open-red-sea-bab-el-mandeb/).
- The EIA does not expect Gulf production and trade patterns to return to pre-conflict status until early 2027 — EIA Short-Term Energy Outlook (https://www.eia.gov/outlooks/steo/report/global_oil.php).
- Frédéric Schneider is a (nonresident) senior fellow at the Middle East Council on Global Affairs and an economist — Gulf International Forum bio (https://gulfif.org/authors/dr-frederic-schneider/); he is quoted in parallel Al Jazeera reporting (https://www.aljazeera.com/news/2026/8/20/tremendous-costs-can-trump-stop-other-countries-from-trading-with-iran).
- Senator Mark Warner, vice chairman of the Senate Intelligence Committee, posted on X: 'When will Trump walk away from this disastrous and deadly war?' — primary source post (https://x.com/MarkWarner/status/2090472400248807609).
- Trump told supporters that paying 'a tiny little bit more for your gasoline' is worth ensuring 'a very evil country' cannot have a nuclear weapon — Common Dreams (https://www.commondreams.org/news/trump-record-gas-prices); The New Republic transcript (https://newrepublic.com/article/214395/transcript-trump-tirade-gas-prices-backfires-epic-self-own).
- The US and Israel launched strikes on Iran on 28 February 2026 — CFR Global Conflict Tracker (https://www.cfr.org/global-conflict-tracker/conflict/confrontation-between-united-states-and-iran); Britannica (https://www.britannica.com/event/2026-Iran-war).
- Iran is negotiating with Oman over the future management/administration of the strait and has refused direct talks with Washington pending Hormuz conditions — US News/AP (https://www.usnews.com/news/world/articles/2026-08-25/ship-disabled-by-attack-in-strait-of-hormuz-and-other-news-from-around-the-middle-east); CNBC (https://www.cnbc.com/2026/08/25/iran-oman-strait-hormuz-oil.html); NBC News (https://www.nbcnews.com/world/iran/iran-sets-steep-demands-reopening-hormuz-hopes-oman-deal-break-impasse-rcna591553).
- Trump claimed 'total control' of the Strait of Hormuz, a claim independent outlets characterise as questionable — Bloomberg (https://www.bloomberg.com/news/articles/2026-08-12/trump-claims-hormuz-control-as-us-iran-harden-their-positions); CNN (https://www.cnn.com/2026/08/18/business/iran-strait-of-hormuz-oil).
- Al Jazeera analysed Kpler maritime data on Hormuz transits and operator behaviour — companion piece, 20 Aug 2026 (https://www.aljazeera.com/news/2026/8/20/are-hormuz-ships-more-willing-to-defy-iran-or-the-us-what-data-shows).
- Trump's approval fell to 33% in a Reuters/Ipsos poll, the lowest of his presidency, matching his December 2017 low, with roughly 80% expecting the Iran war to continue indefinitely — Reuters via US News (https://www.usnews.com/news/world/articles/2026-08-17/exclusive-trump-approval-falls-to-33-lowest-of-his-presidency-reuters-ipsos-poll-finds); Fox News (https://www.foxnews.com/politics/trump-approval-rating-plummets-new-low-ahead-critical-midterms); The Hill (https://thehill.com/homenews/campaign/6049179-trump-approval-rating-hits-low/).
- Trump initially indicated the conflict would be short (four to five weeks) — Texas Public Radio, 25 Aug 2026 (https://www.tpr.org/podcast/the-source/2026-08-25/has-the-war-between-the-u-s-and-iran-become-a-quagmire); CBS News timeline (https://www.cbsnews.com/news/when-will-the-iran-war-end-what-trump-has-said/).
Disputed claims 1 claim ⌄
- Closest candidates, both rated Unverified rather than False: the 'nearly a one-month high' characterisation of Brent's move (described as a three-week high by OilPrice.com, 20 Aug 2026), and the '130 ships per day' pre-war baseline (an upper-bound figure presented as a central estimate).
Unverified claims 7 claims ⌄
- UNVERIFIED (precise figures): 'US crude oil nudged up from its Wednesday closing price of $86.20 per barrel to $86.70' and 'On Friday morning, it was trading at about $86.20.' Directionally corroborated — FRED records WTI at $86.48 on 18 Aug 2026 (https://fred.stlouisfed.org/series/DCOILWTICO) and WTI confirmed closing above $86 on 20 Aug 2026 (https://www.lines.com/prediction-markets/finance/wti-closes-above-on-august-20-2026) — but the exact intraday and closing prints could not be matched to a primary settlement source.
- UNVERIFIED / MINOR DISCREPANCY: 'Brent crude topped $93 a barrel' as 'nearly a one-month high', and 'remained at $93.28 a barrel' on Friday. OilPrice.com confirms Brent topping $93 early Thursday but characterises it as a three-week high (https://oilprice.com/Latest-Energy-News/World-News/Brent-Oil-Price-Tops-93-as-US-Iran-Impasse-Persists.html), while Fortune's snapshot for 06:15 ET on 20 Aug 2026 records $95.40 (https://fortune.com/article/price-of-oil-08-20-2026/). The $93.28 Friday figure is not independently confirmed. Not rated False: benchmark quotations legitimately vary by contract, venue and timestamp.
- PARTIALLY VERIFIED: 'Before the war, some 130 ships passed through the strait each day.' Britannica gives a typical range of more than 80 to more than 130 ships daily (https://www.britannica.com/place/Strait-of-Hormuz), and NBC News refers to 'a hundred-plus ships a day' pre-war (https://www.nbcnews.com/data-graphics/strait-of-hormuz-ports-traffic-trump-us-iran-war-rcna331507), while one live tracker cites ~73/day as normal (https://straits.live/). The article uses the upper bound as a point estimate without a range.
- UNVERIFIED (causal attribution): that the $40 trillion debt milestone arrived 'two years before expected, as a result of the costs of the war and Trump's lowering of corporate taxes.' The milestone itself is verified, and CBS notes CBO estimates relating to the administration's tax law (https://www.cbsnews.com/news/national-debt-tops-40-trillion-doubles/) and Euronews notes $1 trillion added in five months (https://www.euronews.com/business/2026/08/22/five-charts-explaining-americas-40-trillion-debt), but no source located quantifies the specific 'two years early' baseline or apportions causation as stated.
- PARTIALLY VERIFIED: petrol 'up nearly a third compared with a year ago, according to the American Automobile Association'. AAA records a national average of $4.10 on 20 Aug 2026, a record for the date (https://gasprices.aaa.com/high-crude-oil-prices-push-up-national-average/), and LendingTree records double-digit year-on-year rises in every state, up to 38.9% (https://www.lendingtree.com/credit-cards/study/us-gas-prices/). The specific national ~33% year-on-year figure is consistent with these but was not located as an explicit AAA statement.
- UNVERIFIED (framing, not fact): 'there are just a few weeks to go before pivotal midterm elections in November'. Election day is 3 November 2026 (https://ballotpedia.org/United_States_Congress_elections,_2026; https://www.britannica.com/event/2026-US-midterm-elections), roughly ten weeks after the 21 August publication date — an imprecise temporal characterisation rather than a factual error.
- UNVERIFIED (timing detail): that 'On Wednesday, Tehran dismissed Trump's threats'. Reuters-derived reporting and ABC News date Araghchi's 'diversion' post to Thursday (https://www.fxstreet.com/news/irans-araghchi-says-economic-d-day-is-a-diversion-from-the-us-crisis-202608200624). Time-zone differences between Tehran and US publication cycles plausibly explain this; insufficient basis for a False rating.
Sources & how we checked Search journal, source grades, confidence ⌄
Confidence
High (0.87) — Confidence is high because the article is unusually falsifiable — roughly twenty discrete numerical claims — and because verification succeeded against primary institutional data (EIA, FRED, AAA, Treasury reporting) and a wide, ideologically diverse set of dated secondary sources that independently converge on the same figures, including exact index closes to two decimal places. The original publication was located, establishing provenance and confirming the text is a faithful reproduction rather than a fabrication. Confidence is held below 0.95 for four reasons: the ingested copy contained no working embedded links, so the article's own evidentiary chain is unauditable; exact commodity price prints could not be settled against exchange data; one relevant source was paywalled and assessed from summary only; and the situation is fast-moving, with material developments between publication on 21 August 2026 and the research date of 25–26 August 2026 (formal sanctions announcement, Iran–Oman talks, Brent falling to roughly $86). The residual uncertainty concerns precision and currency, not the substantive accuracy of the reporting.
Search journal
US total national debt $40 trillion Treasury
- https://www.cbsnews.com/news/national-debt-tops-40-trillion-doubles/
- https://www.npr.org/2026/08/19/nx-s1-5937552/the-u-s-debt-tops-a-record-shattering-40-trillion-yes-with-a-t
- https://www.euronews.com/business/2026/08/22/five-charts-explaining-americas-40-trillion-debt
Strait of Hormuz closed shipping today
- https://straits.live/
- https://www.nbcnews.com/data-graphics/strait-of-hormuz-ports-traffic-trump-us-iran-war-rcna331507
- https://www.cbsnews.com/news/iran-war-strait-of-hormuz-not-open-red-sea-bab-el-mandeb/
Brent crude oil price today
- https://tradingeconomics.com/commodity/brent-crude-oil
- https://www.eia.gov/dnav/pet/hist/rbrted.htm
- https://oilprice.com/
Dow Jones Industrial Average close today
- https://www.cnbc.com/2026/08/19/stock-market-today-live-updates.html
- https://finance.yahoo.com/quote/%5EDJI/
- https://www.cnbc.com/2026/08/23/stock-market-today-live-updates.html
Trump approval rating Reuters/Ipsos poll
- https://www.usnews.com/news/world/articles/2026-08-17/exclusive-trump-approval-falls-to-33-lowest-of-his-pr...
- https://www.foxnews.com/politics/trump-approval-rating-plummets-new-low-ahead-critical-midterms
- https://thehill.com/homenews/campaign/6049179-trump-approval-rating-hits-low/
Trump "economic D-Day" Iran Truth Social threat
- https://www.cnbc.com/2026/08/19/us-iran-war-trump-hormuz-economic-warfare.html
- https://www.cnn.com/2026/08/22/world/live-news/iran-war-trump
- https://www.aljazeera.com/news/2026/8/21/trumps-economic-d-day-claims-first-victim-not-iran-but-us-markets
Bessent Treasury buybacks long-dated debt $4 billion emergency
- https://www.cnbc.com/2026/08/20/bessent-says-treasury-buyback-operation-could-be-more-than-4-billion.html
- https://www.cnbc.com/2026/08/24/bessent-1-trillion-treasury-general-account-bond-buybacks.html
- https://finance.yahoo.com/economy/article/one-day-after-doubling-treasury-buybacks-bessent-says-hes-ready-t...
30-year Treasury yield 5.25% two-decade high August 2026
- https://www.cnbc.com/2026/08/18/treasury-yields-.html
- https://www.axios.com/2026/08/17/treasury-yields-warsh-bonds
- https://www.crfb.org/blogs/treasury-auction-yield-hits-highest-25-years
UAE embargo Iran missiles Emirates announcement
- https://www.aljazeera.com/news/2026/8/19/uae-imposes-indefinite-trade-embargo-on-iran-over-alleged-missile-attacks
- https://www.timesofisrael.com/uae-puts-financial-embargo-on-iran-after-missile-threat-targets-maritime-traffic/
- https://www.aljazeera.com/news/2026/8/19/uae-trade-embargo-could-shut-irans-key-economic-escape-route-heres-why
Araghchi response Trump economic threats diversion
- https://www.jpost.com/middle-east/iran-news/article-906065
- https://abcnews.com/International/live-updates/iran-live-updates-tehran-adopt-offensive-aspect-irgc?id=1357...
- https://www.fxstreet.com/news/irans-araghchi-says-economic-d-day-is-a-diversion-from-the-us-crisis-202608200624
WTI US crude oil price August 20 2026 $86 barrel
- https://fred.stlouisfed.org/series/DCOILWTICO
- https://www.lines.com/prediction-markets/finance/wti-closes-above-on-august-20-2026
- https://www.energyintel.com/0000019f-fcc0-d9f2-afdf-fde00f3a0001
gasoline prices AAA up a third year war Iran 2026
- https://gasprices.aaa.com/high-crude-oil-prices-push-up-national-average/
- https://www.lendingtree.com/credit-cards/study/us-gas-prices/
- https://www.newsweek.com/gas-prices-set-to-stay-high-even-if-iran-war-ends-12001888
US strikes Tehran February 28 2026 war begins
- https://www.cfr.org/global-conflict-tracker/conflict/confrontation-between-united-states-and-iran
- https://www.britannica.com/event/2026-Iran-war
- https://www.ajc.org/news/the-iran-strikes-explained-how-we-got-here-and-what-it-means
Mark Warner "walk away from this disastrous" war Iran post X
- https://x.com/MarkWarner/status/2090472400248807609
- https://x.com/MarkWarner
- https://finance.yahoo.com/economy/policy/articles/trump-economic-d-day-claims-134726943.html
Iran Oman negotiations future management Strait of Hormuz
- https://www.usnews.com/news/world/articles/2026-08-25/ship-disabled-by-attack-in-strait-of-hormuz-and-other...
- https://www.cnbc.com/2026/08/25/iran-oman-strait-hormuz-oil.html
- https://www.nbcnews.com/world/iran/iran-sets-steep-demands-reopening-hormuz-hopes-oman-deal-break-impasse-r...
Strait of Hormuz 20 percent global oil 130 ships per day before war
- https://www.britannica.com/place/Strait-of-Hormuz
- https://www.britannica.com/topic/How-Much-Oil-Passes-Through-the-Strait-of-Hormuz
- https://www.britannica.com/question/How-many-ships-pass-through-the-Strait-of-Hormuz
Trump rally gasoline "very evil country" nuclear weapon August 2026
- https://www.commondreams.org/news/trump-record-gas-prices
- https://newrepublic.com/article/214395/transcript-trump-tirade-gas-prices-backfires-epic-self-own
- https://www.thewrap.com/media-platforms/politics/trump-will-never-apologize-iran-war-gas-prices/
EIA Gulf oil output recover pre-conflict levels 2027 forecast
- https://www.eia.gov/outlooks/steo/report/global_oil.php
- https://www.eia.gov/pressroom/releases/press590.php
- https://oilprice.com/Energy/Crude-Oil/EIA-Sees-600000-Bpd-of-Middle-East-Oil-Still-Offline-by-End-2027.html
Article metrics
The article we checked Full text as retrieved ⌄
United States President Donald Trump has threatened a crushing financial campaign against Iran, which he has referred to as “economic D-Day”, as the war on Tehran continues to drag on.
But on Thursday, the first casualty appeared to be US markets.
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As US crude oil nudged up from its Wednesday closing price of $86.20 per barrel to $86.70, the US stock market made its worst losses in three weeks. Meanwhile, the US announced its total debt has surpassed a record $40 trillion this week.
Here’s what Trump has threatened and what the result has been so far.
## What did Trump threaten?
In a post on Truth Social on Wednesday, Trump said Iran had “failed to take” the opportunity to make a deal, and would face “economic warfare and isolation on an unprecedented scale”.
He also threatened new sanctions against any country that does business with Iran.
“ANY country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face TREMENDOUS Economic Consequences,” he wrote.
On Thursday, Treasury Secretary Scott Bessent told CNBC again that this new “economic warfare” could include more [secondary sanctions on other nations]( and companies that conduct business with Iran.
The latest Trump administration rhetoric comes as the critical Strait of Hormuz in the Gulf remains closed to shipping, upending global energy and financial markets. Before the war, some 20 percent of global oil and natural gas supplies were shipped through this waterway.
The war is increasingly becoming unpopular within the US as the costs of petrol and other living expenses rise.
Get instant alerts and updates based on your interests. Be the first to know when big stories happen.
On Wednesday, Tehran dismissed Trump’s threats, with Foreign Minister Abbas Araghchi calling the so-called “economic D-Day” a “diversion from America’s own crisis”.
## How have US markets reacted to Trump’s ‘economic warfare’ announcement?
The US and Israel’s war on Iran has paralysed the Strait of Hormuz, the only route to the open ocean through which Gulf oil producers can ship their exports. Before the war, some 130 ships passed through the strait each day. Now barely a handful get through. This has hugely unsettled the global energy and financial markets.
Following Trump’s economic threats against Iran on Wednesday, global crude oil prices rose to nearly a one-month high on Thursday morning with Brent crude – the global benchmark – topping $93 a barrel. On Friday morning, the price of Brent remained at $93.28 a barrel.
In the US, US crude oil climbed to $86.70 per barrel on Thursday. On Friday morning, it was trading at about $86.20.
Meanwhile, US stock markets made their worst losses in three weeks.
The Dow Jones Industrial Average shed 703.84 points, or 1.32 percent, closing at 52,759.21 on Thursday evening. The S&P 500 lost 0.87 percent, closing at 7,641.16.
On Friday morning, US indices showed signs of stabilising.
Frederic Schneider, a nonresident senior fellow at the Middle East Council on Global Affairs, noted that the 30-year US Treasury yield pushed above 5.25 percent, close to a two-decade high after Trump’s announcement. This indicates that the price of US bonds is falling as investors avoid them, signalling a lack of confidence in the US.
Bessent announced an emergency move to double the Treasury’s buybacks of long-dated debt to at least $4bn, but this did not calm the market.
“This is a strong signal, as the world’s most powerful treasury had to reach for extraordinary measures and failed to calm the market,” Schneider told Al Jazeera.
“Long-dated Treasuries have faced a ‘buyers’ strike’ since June, driven by a widening federal deficit, a wave of AI-related corporate borrowing, and now an oil-price inflation premium layered on top,” he added.
## Is the US also facing wider economic pressure?
Yes. Analysts say both Iran and the US have been feeling the economic pressure of Washington’s war on Tehran.
Schneider told Al Jazeera: “The ‘economic war’ keeps the Strait of Hormuz shut, which keeps oil [prices] elevated. The US Energy Information Administration does not expect Gulf output to recover to near pre-conflict levels until early 2027, and the shortage is fanning American inflation, which feeds into the bond market, which is where the real damage is now showing.”
He added that the war has shone a light on the US’s vulnerabilities, despite having its own oil industry capable of providing for its needs.
“The US is technically energy self-sufficient, but it is not insulated. Petrol prices and cost of living in general are a core topic in a midterm election year. But the Federal Reserve cannot cut rates to support a slowing economy without fuelling the very inflation the oil shock is generating,” he said.
Furthermore, this week a US Department of the Treasury update revealed that total US debt has surpassed [$40 trillion]( for the first time in history – two years before expected, as a result of the costs of the war and Trump’s lowering of corporate taxes.
Schneider noted that the US also needs to consider its allies’ economies.
“The Gulf states and the East Asian economies are the hardest hit by this war, and they are also among the largest holders of US assets,” he said.
On Wednesday night, Trump also [warned]( that any country whose “financial institutions, businesses, airports, or government entities” aid Tehran will face “TREMENDOUS Economic Consequences”.
Hours earlier, the UAE, a longtime trade hub for Iran, announced an indefinite embargo after accusing Iran of firing missiles at its territory, a move analysts called significant given Iran’s reliance on Emirati financial access.
“As the Gulf draws down reserves and reconsiders where it deploys its sovereign wealth, and as Japan strains under its own currency pressures, the marginal buyers of American debt are pulling back at precisely the moment Washington most needs them,” he added.
## What does all this mean for Trump?
The [war on Iran,]( which the Trump administration can’t seem to bring to an end, is increasingly unpopular in the US.
Now, there are just a few weeks to go before pivotal midterm elections in November determine whether his Republican Party can keep control of Congress.
US Senator Mark Warner, vice chairman of the Senate Intelligence Committee, criticised ongoing US involvement in the conflict with Iran in a post on X on Thursday.
“When will Trump walk away from this disastrous and deadly war?” he asked.
On Friday, Trump told a rally of supporters that paying “a tiny little bit more for your gasoline” is worth the cost of ensuring “a very evil country”, meaning Iran, cannot have a nuclear weapon.
However, peace talks between the US and Iran, which would cover Iran’s nuclear capabilities, have yet to get seriously under way as the crisis in the Strait of Hormuz continues. Iran is currently negotiating a deal with Oman over the future management of the strait, which was open and free to all commercial shipping before the US launched strikes on Tehran on February 28.
Iran says it will not talk directly to the US on this matter and [will not engage in talks]( until the matter of Hormuz is completely settled, as well as other conditions it has set for talks. Experts say there is little hope of a successful end in sight.
Furthermore, despite Trump’s claim that US forces are in “total control” of the Strait of Hormuz, [data analysed]( by Al Jazeera and Kpler, the maritime intelligence agency, suggests that ship operators may currently be more fearful of falling foul of the Iranian blockade of the strait than they are of the US naval blockade in the same area.
Trump’s approval rating in the US has now [fallen]( to its lowest level in his presidency, with an overwhelming majority of Americans concerned that the US-Israel war on Iran will last a very long time.
Consumers have seen fuel prices rise dramatically since the war began in February, with the cost of gasoline [petrol] up nearly a third compared with a year ago, according to the American Automobile Association.
Just 33 percent of respondents approved of Trump’s job performance, according to the Reuters/Ipsos poll. The approval rating matches the lows seen in December 2017 during his first term.
Trump, who campaigned on a promise to keep inflation in check and avoid long-lasting wars, initially pledged that the conflict with Iran would take just a few weeks.