Going into last weekend, I warned that the war in Iran would be used as a smokescreen to distract from the rapidly deteriorating financial system—particularly the skeletons now tumbling out of the closet in private credit. Within days, the evidence began piling up.
Both BlackRock and Blackstone suspended withdrawals from major private credit vehicles this week as redemption requests surged. Reports also surfaced that Blackstone employees were forced to help provide liquidity to meet existing withdrawal requests before the freeze took effect!
A major warning of just how strained conditions have become inside the private credit ecosystem. None of this inspires confidence in the repeated assurances that there is “no systemic problem.” If anything, it confirms the opposite: the stress in private markets is far deeper than the public narrative suggests.
At the same time, geopolitical tensions have exploded. Oil prices have surged toward $100 per barrel, with many analysts warning that an escalation in the Middle East could quickly push prices over $150 if supply disruptions continue. At those levels, a global recession becomes almost unavoidable.
But here’s the key point: the recession was coming regardless. The war didn’t cause the underlying financial fragility—it merely provides a convenient explanation for it. When the system begins to fracture, the story always shifts. Attention moves away from leverage, liquidity mismatches, and asset bubbles—and toward their pre-planned events.
So what happens next?
In my latest episode, I break down why a catalyzing event may now be necessary to justify the tidal wave of liquidity required to stabilize the system once again. The scale of intervention required will be enormous—so enormous that policymakers may need a crisis big enough to explain it. A moment where suddenly everyone, everywhere, needs a rescue at the same time.
In my view, the most likely candidate is a scenario laid out in a 2021 war game in Israel called Collective Strength. Something I will be exploring in an upcoming article. Until then, enjoy the episode and have a great weekend.
Mike
CONSULTATION WITH MIKE
For more than four years I’ve been guiding clients towards positioning themselves and their families to protect their wealth during the high-risk environment we are now in.
From managing the Great Taking and asset confiscation, to protecting pensions and 401(k)’s — this is where I specialize. I also support people with creating a Plan B, analyzing risk, and preparing to become more self-sufficient.
As such, if you would like personal, one-to-one support to secure your wealth, now is a great time to book. The consultation can be booked via the link below.
