Iran

Within twenty-four hours, the two central banks that matter most for Japanese equity investors held their policy rates steady. The Bank of Japan kept its overnight call rate at 0.75 per cent. The Federal Reserve kept its federal funds rate at 3.50–3.75 per cent. Both decisions were expected. Neither was the story. The story is in the dissents — and in what they reveal about the diverging trajectories of the world’s two largest bond markets, the unwinding of the yen carry trade, and why TOPIX, and Japanese financial stocks in particular, are positioned to outperform global indices through the turbulence ahead. ...

On Monday, financial containment appeared to be winning. The Nikkei rallied 2.88%. Oil, which had touched $119 on Brent, collapsed to the high $80s after Trump told CBS News that the war was “very complete, pretty much”. By Wednesday the IEA had announced the largest coordinated oil reserve release in its history: 400 million barrels from 32 member nations. The US contributed 172 million barrels from the SPR. Japan committed 80 million barrels, its first solo reserve release since 1978. Bessent unsanctioned Russian crude stranded on the water, creating additional supply at the stroke of a pen. G7 energy ministers convened in Paris. Trump declared victory. ...

Ten days ago, Brent crude was $66. On Monday it touched $119.50 before settling around $93. The Nikkei 225 fell 5.2% on Monday. USD/JPY hit 159.14, one tick from what traders regard as the Ministry of Finance intervention threshold. The UST 10-year yield briefly breached 4.21% before pulling back to 4.13%. And yet the financial system did not crack. This article examines what Scott Bessent spent to keep it that way, what it reveals about the yen’s role in a crisis, and why his binding constraint — the 10-year yield — is tighter now than it was before the first missile was launched. ...

This is a follow-up to The Hidden Overall Commander of Operation Epic Fury May Have Been the Treasury Secretary. That piece argued that the economic logic of the operation pointed to Scott Bessent as the architect of its financial constraints. One week later, the framework still holds. But the scenario it depended on is under severe strain. The original thesis rested on a single pivot point: the Strait of Hormuz would reopen quickly, Iranian oil infrastructure — deliberately preserved — would become the basis of a deal, and oil prices would fall far enough to solve five of Bessent’s problems simultaneously. ...

On the night of February 28, 2026, Vice President JD Vance monitored Operation Epic Fury from the White House Situation Room. According to WBUR/AP reporting, he was joined by Secretary of Energy Chris Wright, Director of National Intelligence Tulsi Gabbard, and one person whose presence might seem unusual in a military operation: Treasury Secretary Scott Bessent. Defence Secretary Pete Hegseth called the operation “the most lethal, most complex, and most-precision aerial operation in history.” But I find myself wondering: was this operation designed by the military, or shaped by someone who thinks in bond yields, oil futures, and capital flows? ...