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Four months ago, I paid just under $3 for a gallon of gas. Yesterday, I paid $4.39. The Strait of Hormuz disruption has triggered what the IEA is calling the largest oil supply shock in the history of the global oil market, and its effects are now embedded in bond yields, earnings estimates, and inflation expectations across every asset class. You already know the macro picture. What I want to address is the decision — and the opportunity — in front of you right now.
Every major geopolitical shock produces the same behavioral pattern: volatility spikes, anxiety follows, and investors move toward cash. It feels like prudence. The data says otherwise.
LPL Research’s analysis of 20 major military conflicts since WWII shows the S&P 500 recovered in 19 of those 20 cases within 28 days of the initial shock. Hartford Funds puts the probability of the index being higher one year after a geopolitical event at roughly 70%. The one historical exception, 1973, is worth taking seriously — because it rhymes with today: a sustained energy supply shock feeding into an already-inflationary environment.
That scenario isn’t off the table. But acting as if it’s inevitable means accepting the cost of being wrong in the more likely scenario.
Since February 28, 2026, rising inflation and a resilient jobs market have pushed 10-Year Treasury yields to the +4.5% range — and current market pricing reflects a 98% probability of another interest rate hike on the horizon. New jobs are being created, which sounds positive. But in an inflationary economy, that data gives the Fed cover to raise rates further.
Here’s what that means for bond investors: long-duration bonds lose value as rates rise. If you’re holding long-term fixed income and haven’t revisited your strategy since rates started climbing, you may already be behind.
If your business involves marine transportation, logistics, or any product line tied to oil, gas, or chemical byproducts, the Hormuz disruption isn’t just a headline — it’s a direct hit to your cost structure.
This is exactly the kind of environment where hedging strategies and pricing adjustments can make or break a year. At Rigby Financial Group, we work with business owners to:
• Mitigate costs tied to fuel and commodity pricing
• Revisit and strengthen current pricing strategies
• Implement hedging approaches to insulate margins from energy volatility
• Navigate current life events with a proactive, forward-looking financial plan
The Middle East conflict has ripple effects beyond energy. Geopolitical instability — particularly tensions involving Taiwan, a critical hub for semiconductor manufacturing — is raising legitimate questions about chip supply chains. GPU manufacturers like NVIDIA and others sourcing components from Asian foundries face real exposure if conflict escalates.
For businesses that depend on chips, electronics, or technology hardware — or for investors with exposure to the sector — the question worth asking right now is: should you be adding to inventory or repositioning holdings ahead of potential supply constraints?
Do you know a business owner in tech, manufacturing, facing strategy questions surrounding semiconductor inventory? Connect them with Rigby Financial Group. We’re actively helping clients think through these and other strategic inventory decisions.
Rather than reacting to the headline, use this moment to pressure-test your position across four areas:
Liquidity and time horizon. If you have a near-term liquidity event — a business sale, a distribution, a transition — this environment requires a different posture than a 10-year hold. That conversation should be happening now, not after prices move.
Inflation exposure. Persistent energy disruption is the mechanism through which this becomes a 1973-style event. Real assets, TIPS, and equities with genuine pricing power are better positioned than long-duration fixed income and cash in low-yield accounts.
Concentration risk. For business owners, the business is often the largest and least-liquid asset on the balance sheet. A volatile market is a useful reminder that personal financial independence shouldn’t be entirely contingent on a single exit.
Bond positioning. In a rising-rate environment, the wrong bond allocation costs you money. Short-duration is generally more appropriate right now — but the right answer depends on your situation. Call us and we’ll help with fixed income asset evaluation.
Markets move faster than plans can be built. Our job — and what we’re doing actively with clients right now — is to cut through the noise, stress-test portfolios against realistic scenarios, and make sure your strategy is doing what it was designed to do. If it’s not, we’d rather identify that today than in hindsight.
Just like we did for clients during COVID — helping navigate PPP loans, tax credits, and a flood of confusing guidance — we’re here to turn complexity into clarity.
Contact Rigby Financial Group for a free, no-obligation consultation. We’ll invest our time into you.
Until next time – Peace,
Principal, CPA/PFS
The information provided in this blog is for general informational and educational purposes only and is not intended to constitute, and should not be relied upon as, financial, accounting, tax, or legal advice. Cash flow forecasting and financial planning involve inherit risks and uncertainties, and results may vary significantly based on a variety of factors. By reading this blog, you acknowledge and agree to this disclaimer.
We hope you enjoy this edition of The Prosperity Briefing. If you have any questions or would like to schedule a consultation, feel free to email us or use the form below. If you found this helpful we encourage you to share it with a colleague or business owner who may benefit as well.
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