Atlanta, GA
March 22, 2026
In early March 2020, despite a wave of restrictions around the world, Americans kept living as if nothing would change. By the middle of the month, everything did.
Similar cognitive dissonance seems to be happening now. The Iran War is among the most calamitous blunders the U.S. government has ever made, launched by the same president who orchestrated “Warp Speed” and green-lighted lockdowns.
The ramifications are more wide-ranging and significant than most people think. Yet most remain oblivious. They won’t be for long.
Lockdown Redux?
With the Strait of Hormuz sealed and energy infrastructure being obliterated, sources of fuel and fertilizer aren’t merely being disrupted; they’re being destroyed.
When Iran retaliated against US and Israeli attacks by striking the largest liquified natural gas facility on earth, it wiped out almost 20% of Qatar’s LNG supplies. This eliminates almost 13 million tons for up to five years. Yet like Wile E Coyote floating off the cliff, markets have yet to look down.
Food and energy shortages are imminent. In many places, they’re already here. As are plans to “protect” us from them.
On Friday, the International Energy Agency published an ominously titled paper called “Sheltering from Oil Shocks”, which prescribes constraints on freedom of movement. Some measures are already being implemented.
South Korea and Japan are rationing fuel. Thailand is “suggesting” people work from home to save energy. Australia is advising avoidance of “non-essential” journeys (where’ve we heard that description before?).
The U.S. Agriculture Secretary announced that one in four American farmers lacks fertilizer for spring planting. Yet if they’re going to plant, they need to do it now. Will they? Can they?
Other ideas percolating in bureaucratic brains include compulsory “car-sharing”, reduced driving speeds, restricted air travel, and rotating plate schemes to limit road access to alternating days.
If there’s any place you need to go, it’s probably best to get there soon. Jet fuel is already in short supply, with Europe and Asia particularly vulnerable.
But America isn’t immune from these self-inflicted shocks. United Airlines announced it’s cutting 5% of its flights. Meanwhile, Marin Katusa reports from the farm front:
“About half the nitrogen applied to U.S. corn goes in during spring planting.
A vessel loaded in the Persian Gulf today takes 30 days to reach a U.S. port, and another 3 to 4 weeks to reach interior farm markets.
The American Farm Bureau Federation sent an urgent letter to the White House on March 9th. Their message was direct: fertilizer is stranded in the Middle East during the most critical window of the agricultural calendar.
Agriculture Secretary Brooke Rollins confirmed publicly that roughly 25% of American farmers have not yet secured their fertilizer for this spring.
The choice facing those farmers is ugly. They can reduce nitrogen application, switch from corn (which needs heavy nitrogen) to soybeans.
Or, absorb the cost and bet on crop prices recovering. None of those options are good.”
Whichever ones are chosen will almost certainly lead to higher prices.
Fuel and food aren’t the only essentials subject to shortage. Pharmaceuticals can also dwindle. Almost half the ingredients in generic drugs are made in India, which imports about 40% of its crude thru the Persian Gulf.
Not anymore.
Trapped oil can’t feed refineries that produce naphtha used in petrochemical crackers that make the intermediates in India’s pharmaceutical plants. These facilities produce the active pharmaceutical ingredients shipped to manufacturers in the U.S., Europe, and Asia. Industry consensus is that about four to six weeks of inventory exists, after which shortages start.
As usual, the President of the United States is making things worse. A day after claiming the Strait of Hormuz was essentially irrelevant to the US and that those who use it should clean up his mess, he announces he’ll commit more war crimes if Iran doesn’t relent:
Iran responded by promising to reciprocate. It’s as if the goal of this war was to destroy the resources that sustain civilization.
Alpha Strategy
Upheaval is in the wind. Best to brace for something more than a breeze. At the very least, it’s time to trim the sails.
Events are causing widespread restrictions, severe shortages, and crippling price increases. Will they come to the US? I don’t know. But it’s better to prepare than predict, and precaution is prudent. Some steps are simple.
Aside from a few precious metals miners and some oil, gas, and shipping stocks, we’ve shed most equities. This seems like a good time to get out of the way. Last week’s forced liquidation offers an opportunity to add to our gold at a better price. And it’s reasonable to compile cash to buy bargains when the market tanks.
But practical measures are even better. Keep the gas tank full and extra essentials on hand… particularly items that won’t perish and will be used anyway. Toilet paper, trash bags, aluminum foil, shaving supplies, tools, toothbrushes, combs, light bulbs (we bought boxes of incandescent bulbs almost twenty years ago when the government decided we’d no longer be allowed to buy them. We still have them and haven’t purchased a bulb since).
Food is an obvious investment, particularly durable items like canned goods, grains, jerky, legumes, dried fruits, coffee, tea, peas, pasta, and bottled water. Most of these last at least a year. Load up, store based on expiration date, and then replenish and rotate as they’re consumed.
Most of these things will fetch more dollars in the future than they do now, and they may be life-savers if conditions get dire. Best to stock up, hope no emergency arises, and welcome inflation as a tax-free return on investment.
Forty-five years ago, during the last great stagflation, John Pugsley wrote The Alpha Strategy, which applied this approach for the type conditions we’re entering today. Saving the type consumables discussed above was the second pillar of his three pronged strategy.
The first was to invest in “production”, by which he meant knowledge and tools that enhance competence in marketable (and perhaps survival) skills. Building, cooking, fighting, shooting, speaking another language. These abilities are not only practical, they’re personally rewarding and spiritually satisfying.
After investing in supplies and ourselves, the third step is to secure savings in hard assets. This can include copper, ammo, wood, wine, or real estate. But precious metals are probably best.
Buy gold. Be happy.
JD
PS - While we’re still able to travel, here are some ideas where you might want to go:
Fewer pharmaceuticals is good and if there is a return to small scale farming also good. But yes, tough times.
There many a thing that I do not know the answer to. This one thing about the war , is it by design or is this a figment of My imagination? No food and that leaves many a person to "depend" on the government.