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- They Closed the Strait Again.
They Closed the Strait Again.
Oil hit $85. Gas is $3.86. The Fed meets in 9 days. And $39.72 trillion in debt means nobody is getting out of this clean.
Dear Reader,
THEY CLOSED IT AGAIN.
The Strait of Hormuz. Closed. For the second time this year. Oil is back at $85 a barrel. Gas jumped to $3.86 a gallon. And the new Fed chairman just told Congress: prices are too high.
Inside today's issue:
- The double bind: The Fed can raise rates and crash the economy, or hold and watch inflation burn. Neither path saves the dollar.
- The $39.72 trillion problem: The national debt just hit a new record. Washington added $8,204 per person in the last 12 months alone.
- Gold at $4,021: Down 28% from January's all-time high. The structural case for owning it has not changed one bit.
- Larry Benedict just released a new presentation on a strategy called "Oil Skimming." It's worth a look.
HERE IS WHAT BLOOMBERG IS NOT MEASURING.
They told you inflation cooled in June. CPI came in at 3.5% year over year. Technically true. But the Strait of Hormuz was partially open in June. It is not open now.
Trump reimposed the U.S. blockade on Iranian shipping last week. Oil futures spiked 9.4% in a single session on July 13. That is the fourth biggest single-day gain of the year for WTI crude. Brent crude added 9.6% that same day.
The Iran War does not have a durable off-ramp. Energy markets know it. The June inflation win is already yesterday's news.
Here is what makes me angry:
1. National debt: $39.72 TRILLION as of July 4, 2026.
2. Up $2.81 TRILLION in the last 12 months.
3. That is $8,204 more per person, per year.
4. Gas: $3.86 per gallon today. Was $2.94 before the Iran War started.
5. Real wage growth: zero. Wages up 3.5%. Prices up 3.5%.
The average American did not get richer this year. They ran in place. On a treadmill the government is speeding up.
Kevin Warsh took over as Fed chairman in May 2026. His first FOMC meeting was June. He held rates at 3.5 to 3.75 percent. But the June minutes showed nine of nineteen policymakers expect a rate hike before year-end. On July 1, speaking at the ECB Forum in Portugal, Warsh said publicly: prices are too high.
The next FOMC meeting is July 29. Nine days from now.
Here is the bind they are in. Raise rates and housing collapses, credit tightens, the economy slows. Hold rates and oil-driven inflation keeps running, the dollar keeps losing ground, hard assets keep rising.
Gold is at $4,021 today. Down 28% from its January peak of $5,595. The mainstream calls it a correction. I have been watching these cycles for 50 years. What they call a correction, I call a discount window that does not stay open long.
Now. About what comes next.
The mainstream will tell you this is complicated. Geopolitical uncertainty. Supply chain disruption. Exogenous inflationary shocks. That is the polite language for: nobody in Washington had a plan when the Hormuz ceasefire collapsed, and they still do not have one.
I am not surprised. I have watched empires overextend since the 1970s. Nixon closed the gold window in 1971. That was the first domino. Every monetary crisis since has been another chapter in the same story.
The Iran War did not cause this inflation. It accelerated something already happening. At $39.72 trillion in debt, growing at $1.3 billion per day, there is no scenario where the dollar holds its value over a decade. None. The math is the math.
Gold at $4,021 is not cheap. But it is cheaper than $5,595. Those are not the same thing. Silver is at $55 right now, down 52% from its January high of $121. The gold-to-silver ratio is near the top of its 50-year historical range. History says silver closes that gap. It always does.
What can you control right now? Not the Strait of Hormuz. Not what Warsh decides on July 29. Not the debt. What you can control: where you keep your savings. What assets you hold. How much of your wealth sits in paper money the government can print more of.
I have been saying this since 1965, when I bought my first silver coins as a teenager. The politicians argue. The bankers hedge. The cycle continues. Precious metals have been money for 5,000 years. That is not changing because a new Fed chairman gives a speech in Portugal.
To your freedom,
Robert Kiyosaki
Author, Rich Dad Poor Dad
P.S. When the market crashed 37% in 2008, our friend Larry Benedict made $95 million for his clients. Now he is sounding the alarm on oil. He warns that high oil prices could strangle the U.S. economy. Yet where others see disaster, Larry sees one of the biggest opportunities in 40 years, and a way for regular folks to profit without owning a single oil stock. Watch the free presentation here.