2026 has been eventful so far. It started out with a Venezuela “excursion” on January 3rd and ramped up from there. Let's take the temperature on where we are.

You’ve seen the cones below before (here and here).

They track 2026 (through last Friday, April 17th) against statistically credible outcomes based on the last 3 years.

The big add this time is a nifty vertical line on February 28, the day the US-Iran war started.

Let’s start at the end, with the bottom-right panel. Crude oil is meaningfully higher since then. By a lot.

Everything else?

Basically, a “round trip,” as if nothing much happened.

A lot of action. Very little change.

All the while, crude oil – the stuff that the entire global economy runs on – has experienced a massive shock.

They say markets will always surprise you. This market reaction is surprising.

But the market dictates what is. We only get to have opinions.

With that context, let me tell you a story.

On April 9, 1970, Paul McCartney released an interview. It was the first time Paul spoke since John had quietly broken up the Beatles a few months prior. To close the interview, Paul answered this question.

Q: "What are your plans now? A holiday? A musical? A movie? Retirement?"

PAUL: "My only plan is to grow up."

I don't know about you, but it feels to me like that's where we are today.

The post-WWII order appears to be actively vanishing before our eyes.

Economically. Geopolitically. Militarily.

Having witnessed the collapse of the Berlin Wall on TV as a Western European boy, I can't help but be sad about it.

Perfect it was not... But it was nice while we had it.

And yet, we can only accept reality as it is, and "grow up."

Let me quickly spell out the main vectors of change, so we can compare notes.

1. The "below-market-price" global provision of U.S. military services.

I wrote about this topic last year, before and after "Liberation Day."

But here's the short version.

Since the end of the Second World War, "we" (all of us around the globe) had a deal.

The U.S. would protect the world order by providing military services at a discount to its market price (which we could do because of massive technological and operational advantages) in exchange for a global economy that would willingly pay a premium to consume American-based goods and services (including financial services and the use of the U.S. dollar as the global reserve currency).

The US would be "first among equals" on the international stage. Lots of winners and losers, all over town, but that was the deal and it worked reasonably well. We called it Free Trade, which was nice branding.

The rest of the world could use their savings from not having to bear the full weight of defending themselves to do feel-good things, like providing generous social safety nets to their people.

That’s changed. Let’s put some numbers from the French Conseil d'analyse economique (CAE) to it, via Liberation:

That’s 200B Euros of extra annual spending that must come out of somewhere.

Healthcare. Museums. Somewhere.

2. The 20th-century energy "arbitrage."

Here is an even shorter version of the story.

Humans “discovered” fossil fuels and started burning the stuff, thus breaking beyond the barriers of daily existence.

Suddenly, people (and goods) could travel unimaginably long distances.

Workers could commute and work well into the night, in factories and in offices.

Mankind became extraordinarily richer and healthier, and so on.

But we did build the whole human economic machine on oil and gas as a result.

It had problems:

Those two problems could be ignored until they couldn’t.

In a shocking turn of events, there is indeed no free lunch.

The score? Economics: 1. Wishful thinking: 0.

3. The diffuse human knowledge economy.

As oil-powered machines started doing ever more physical work, the “knowledge economy” brought millions of people up the economic ladder.

The knowledge economy was largely human-friendly. The most knowledgeable among us were elevated to the status of experts. The rest of us could play the role of “office glue” (aka managers. See Office Space and The Office.). Everyone contributed. Everyone got paid and received “benefits.”

The rise of AI and its accelerated embrace by corporate America over the last year is telling us this human-friendly arrangement is going to face a renegotiation.

Whether you are an AI optimist or pessimist, it’s hard not to think this could get bumpy.

Here is some data from the BLS to get a sense of magnitude, both in terms of job count and wages flowing through the economy. The short version is that we have millions of middle managers earning billions of dollars in wages. Any “disturbance of The Force” could meaningfully stress the economic machine.

To be clear, current events are prompting us to talk about this now.

But what we are talking about are long-range secular changes, as they say.

I don’t know what happens next.

And that’s true for next week, next month, next year, and even the next decade.

An astute reader told me this week she hadn’t received an email from me for longer than usual.

She is correct.

We were traveling as a family two weeks ago, and I decided that family time deserved priority over writing.

Since the last piece (One Trillion Dollars), we have two new TREUSSARD TALKS conversations out.

If you missed them, here is what to go look for.

My conversation with Erkko Etula.

Believe it or not, we talked about long-short tax-aware strategies (again!) because… well, there is plenty to understand before you can make informed decisions around this stuff.

Erkko built his career at the intersection of academic finance and institutional practice — MIT, Harvard, the Federal Reserve Bank of New York, a decade at Goldman Sachs, and ultimately founding Brooklyn Investment Group.

I liked what Erkko had to say about long-short strategies: three pillars that must coexist.

Risk management. Tax management. The pursuit of pre-tax “return drivers” in the academic sense of factor investing (which is not the same as claiming or expecting predictable outperformance, which you should not).

All of that matters hugely when things like leverage and borrowing are involved. And the tail cannot wag the dog if you don’t like bad surprises.

On the risk side, here is Erkko's framework:

In short, always ask: how does this go badly, and am I still okay if or when it does?

My conversation with Erkko Etula: “Tax-Advantaged Investing, Long-Short Strategies, and the Future of Wealth Management.”

And my conversation with Jim Masturzo.

Jim is Chief Investment Officer at Research Affiliates. He and I were colleagues and Partners there for several years. Jim is bright and speaks as cleanly as he thinks. You’re in for a treat.

We talked about how to think about the impact of “starting conditions” (a.k.a. valuations) on market expectations.

Capital market expectations are not predictions — but they are a disciplined way to anchor around what’s plausible. And to be clear, Jim is not predicting a crash tomorrow. One, he’s not a sensationalist. Second, he was raised on the same intellectual diet as me. One that recognizes that humility is central to a life well lived as an investor.

Jim and I also talked about the debt burden across developed economies, starting with the US.

We talked about the fact that spending cuts don’t seem to win elections and that defaults are catastrophic. In that world, policy can turn to financial repression (aka inflation that reduces the real cost of servicing the debt).

In that world, Jim suggests thinking about things like TIPS, commodities, and other “real” (i.e., inflation resilient) assets, as well as non-U.S.-dollar-denominated claims. And you know what’s fun about that conversation? We recorded it days before the US-Iran war started. It’s aged well (so far), or as they say in academic circles, it’s surviving the out-of-sample test…

My conversation with Jim Masturzo: Debt, Inflation, and the Risky Macro Regime of Fiscal Dominance.

Let’s leave it at this for today. This was a lot. Then again, the world is a lot these days. The best we can do is try to make sense of it together.