Mea Culpa

Well, I was wrong about the Iran War and Strait of Hormuz closure. I wasn't wrong about the war happening, I wasn't wrong about the strait being closed. I was one of the very few who predicted that in advance against a chorus of "that can never happens." No, I was wrong about the economic outcomes, which sort of defeats the entire point. Here's a comparison of QQQ against a few different (this should work in a war) benchmarks - the largest energy stock ETF, an agriculture ETF, and a gold miner ETF.

QQQ is up 20%. Grains and Energy stocks are flat. GDX is down 25%.

Here's QQQ against my 2 largest energy positions.

In fact, among the large sectors, energy has been the worst performer over the past 3 months...

If we look at the latest EIA report, we can see the estimated shut ins for the basically 4 months that Hormuz has been closed and we can surmise that the world lost ~1.3B barrels in crude oil production, which is approximately the reduction estimate for total liquids inventories.

These inventory reductions are forecast to continue, but the reason everyone is bearish on oil now is because they see a glut developing in the aftermath.

Not a return to higher levels of inventories than we had pre conflict, not even a return to the pre conflict estimates when crude was trading not much lower than it is now. And yet somehow this has created an overwhelming flood of bearish prognostications.

Regardless, I concede defeat. I would be significantly wealthier now if I had sold everything that thematically seemed like it should work on the first week of the Iran war (oil, chemicals, agriculture) and just bought tech stocks.

I was wrong, and I am sorry if you followed me into these bets. The Nasdaq is opening up ~2% this morning to compound on the past 3 months. I have given up an extraordinary amount of money, and about half of my gains for the year.