---
title: 'Why the economic threat from the gulf is now much worse: prepare for a recession'
source: 'https://youtube.com/watch?v=MrNt_dQU-xk'
video_id: 'MrNt_dQU-xk'
date: 2026-06-29
duration_sec: 1273
---

# Why the economic threat from the gulf is now much worse: prepare for a recession

> Source: [Why the economic threat from the gulf is now much worse: prepare for a recession](https://youtube.com/watch?v=MrNt_dQU-xk)

## Summary

The video argues that the economic consequences of the Iran conflict are more severe than mainstream news reports, focusing on six key impacts that will affect personal finances, jobs, and daily life. The speaker provides a breakdown of the situation, from oil price shocks to the risk of stagflation, and offers practical advice for viewers to protect themselves financially.

### Key Points

- **Six Main Economic Impacts Identified** [0:43] — The speaker has identified six main impacts the Iran war will have on personal finances, starting with the need to understand the background of the conflict.
- **Background: US-Israel Strike on Iran** [1:18] — On February 28th, the US and Israel launched 'Operation Epic Fury', a coordinated strike on Iran targeting military sites, nuclear facilities, and senior leadership. Iran retaliated with missiles and drones.
- **Iran Closed the Strait of Hormuz on March 2** [1:46] — Iran's closure of the Strait of Hormuz, a chokepoint for 20% of the world's oil, caused oil prices to nearly double from ~$61 a barrel to over $118 by the end of March.
- **Ceasefire Announced but Situation Murky** [2:25] — Trump announced a two-week ceasefire, causing oil prices to drop and markets to rally, but the situation remains uncertain. The US Navy still warns vessels to avoid the waterway due to sea mine threats.
- **Impact 1: Higher Energy and Food Prices** [3:39] — The first impact is rising energy bills, food prices, and transport costs. Oil is an 'invisible ingredient' in almost everything. The speaker advises against making big financial commitments based on assumptions that prices will drop.
- **Impact 2: Job Insecurity and Layoffs** [6:13] — Businesses face rising costs and reduced consumer spending, leading to cuts in overtime, hiring freezes, and layoffs. The hiring rate is similar to the 2008 financial crisis. Advice includes becoming harder to replace and starting an online side hustle.
- **Impact 3: Government Limited Tools to Help** [8:51] — Central banks cannot easily cut interest rates due to rising inflation, and printing money is risky given the national debt ($39 trillion). The speaker advises not to wait for government intervention as the playbook has changed.
- **Impact 4: Risk of Stagflation** [11:40] — Stagflation (high prices + weak economy) is a textbook setup. Moody's AI model predicts a recession with near certainty. The speaker suggests diversifying away from cash and growth stocks into real assets.
- **Impact 5: Weakening US Dollar** [15:08] — The US is trapped between three harmful options: raising interest rates (crashes stocks), printing money (fuels inflation), or stepping back from Iran (questions dollar dominance). Foreign central banks are reducing holdings of US Treasuries and buying more gold.
- **Impact 6: Disproportionate Impact on Low-Income** [18:30] — Low-income households spend nearly 33% of income on food vs 13% for middle-income. Government subsidies often end up as profits for large corporations rather than helping consumers. The speaker emphasizes taking personal responsibility for income.

### Conclusion

The video warns that the economic impacts of the Iran conflict are ongoing and severe, urging viewers to prepare for a recessionary environment with rising prices, job insecurity, and limited government support. The key is to take personal financial responsibility, diversify assets, and develop in-demand skills.

## Transcript

Believe it or not,
the next economic shock
has already started
and the news isn't telling
you the full story.
I'm talking about the Iran war
and the economic chain reaction
it's already triggering,
because even if the situation
appears to be calming down,
the real financial consequences
haven't hit the average person yet.
This is gonna hit your finances hard
and most people won't see it
coming until it's too late.
That's why today I thought
it was important to explain
what's actually going on,
break down the direct impacts on you,
and give you my thoughts on
how you can protect yourself
from the storm.
I'm prioritizing getting
this video out fast,
so don't expect the editing
to be as slick as usual.
It's far more important
for you to hear all
this information sooner
rather than later
so you can take action quickly.
Trust me, if you watch one video today,
make it this one.
Right, so I've identified six main impacts
the Iran war will have on your finances,
but for those to make sense,
we need to talk about...
Have you ever noticed that
every headline right now
seems to contradict the last one?
It's almost like the mainstream media
is purposely trying to
keep everyone confused
so that we don't connect
all the information
that actually matters.
That's why I'm gonna give you a rundown
of everything you need to
know about the Iran war
in the shortest time possible
before we get into the direct impacts
on you and your finances.
So on February 28th,
the US and Israel launched
a coordinated strike on Iran
code-named operation Epic Fury,
firing nearly 900
strikes in just 12 hours,
targeting military sites,
nuclear facilities,
and senior leadership.
And as you can probably imagine,
Iran didn't just sit there and take it,
they fired back immediately,
sending missiles and
drones to Israel, US bases,
and allies across the Middle East.
But the move that really
shook the global economy
came on March 2nd
when Iran closed the Strait of Hormuz.
Now, if you don't know what
the Strait of Hormuz is,
picture it like this.
Imagine there's a single
stretch of motorway
that 20% of the world's
oil has to travel through
every single day with no alternative
and someone just parked a
lorry sideways across it.
Well, in this analogy, Iran is the lorry
and the effects on everyday
people have been much bigger
than most people realize.
Within weeks, oil went
from around $61 a barrel
at the start of the year to
over 118 by the end of March,
that's nearly doubling just three months
and the biggest rise in nearly 40 years.
And then just as everyone
started to panic,
Trump announced a two-week ceasefire.
Oil prices dropped, markets rallied,
and people breathed a huge sigh of relief.
It felt like the reset button
had finally been pressed,
except nobody can agree if it actually was
because even now the
situation stays murky.
Both sides have declared the strait open,
but they can't even
agree on what open means,
who is really in control,
or how long it lasts.
And even the US Navy is
still warning vessels
to avoid the waterway entirely
because the sea mine threat
is not fully understood.
So, is it open?
Technically maybe
but practically, the world isn't sure.
And that uncertainty alone
is enough to keep the damage going,
because no matter what happens next,
the shockwave is already on its way.
The damage has been done,
and that's what I wanna
talk to you about today,
not the politics or the military tactics,
I'm really not interested in that,
what I'm interested in is
what this actually means
for your money, your job,
and your day-to-day life
over the next 6 to 12 months.
Because there are six
impacts unfolding right now
that I think every single
person needs to understand.
Let's get into them.
(lively music)
The biggest lie people
are being told right now
is that the situation is cooling off
when financially it's
just getting started.
Yes, the fighting might be calming down,
but that doesn't mean your
energy bill, food prices,
and transport costs will also go down,
that's not how this kind of shock works.
Think of it like food poisoning.
The moment you stop eating a dodgy prawn,
it doesn't mean you suddenly feel fine,
the poison is already in your system
and it takes time to work its way through
before you feel the full effects.
That's exactly what's
happening to prices right now.
But Mark, aren't you
being a bit over the top?
This is just about oil prices, right?
Well, yes, it's about oil prices,
but no, I'm not being over the top
because oil affects so much
more than you first think,
it's the invisible ingredient
in almost everything you buy.
Think about your last grocery shop.
Every single item on
those shelves was grown,
processed, packaged, and
driven to that supermarket,
and every step of that
process costs money.
And the moment oil gets more expensive,
the steps get more expensive too
until it finally lands on your receipt.
Energy prices have already
risen double digits this year,
and I'm genuinely concerned
it could go a lot higher
over the next three to six months
as a shock works its
way through the system.
That means higher energy
bills, more expensive food,
and pricier transport
costs for everyday people.
So what can you actually do about it?
Well, the most important
thing to do right now
is be very careful about making
big financial commitments
based on the assumption
that things are about to get cheaper,
because realistically,
your monthly expenses are
probably gonna keep going up
before they come down.
If you are thinking about
signing a new lease,
taking on debt, or making a big purchase,
just pause for a moment and
save a bit of extra money
to give yourself some breathing room.
That's also why it's
essential to stay informed
because a lot of what's
happening right now is complex,
fast moving, and easy to misunderstand,
which means most people
will go through it blindly.
The ones who take the
time to understand it
will definitely make better
decisions with their money.
And that's exactly why I started
a new YouTube channel recently
called Mark Tilbury Economics
where I break down the biggest things
happening in the economy
and explain what they actually
mean for you and your money.
So definitely consider subscribing
if you wanna stay up date
with the stuff that actually matters.
I'll leave a link in the description
for those that are serious
about growing their wealth.
I actually think this is
more important than ever,
which is exactly why the second
impact worries me so much
because it hits your paycheck.
(lively music)
If you are not where you
wanna be financially,
this next part is gonna be hard to hear
because your income might not
be as secure as you think.
You see, when your bills go up
and spending goes down,
naturally, something in
the economy has to give,
which could result in you losing your job
right at the worst possible moment.
And if you think your job is secure,
let me tell you why it might
not be as safe as you think.
You see, when energy prices
spike like they have,
businesses get hit from
two directions at once.
On one side, their costs go up,
like transport,
manufacturing, electricity,
things like that,
and on the other side,
people start spending less
because their bills are going up too.
It's like a sandwich being squeezed
from both sides at the same time,
and when this happens,
businesses have to make decisions fast.
It usually starts small
like cutting overtime
and freezing hiring,
but as the crisis continues,
it'll almost certainly lead to layoffs.
And look, I'm not saying
this to scare you,
I'm saying this because the
warning signs were already there
before the oil shock even hit.
Job growth has been slowing down,
companies have been quietly pulling back,
and the last time the hiring rate
was sustained at this level
was during the financial
crisis of 2008 and 2009.
If you have a job right now,
you're probably safe,
at least for the meantime,
but my concern is that when you layer
an energy shock like this
on top of an already struggling market,
everything accelerates.
Historically, when
something like this happens,
energy spikes, businesses get squeezed,
hiring slows, and people get fired,
it's like a chain reaction.
It's pretty worrying stuff,
but luckily there are
a few things you can do
to protect yourself.
First, don't assume your
income is guaranteed.
Even if your job feels solid right now,
this is the kind of environment
where things can change quickly.
Second, if you're employed,
focus on becoming harder to replace.
That can mean picking
up extra responsibility,
improving your skill set,
or just making sure you are
someone your company needs,
not just someone they have.
Third, start an online side
hustle that has the potential
to make you at least $10,000 per month.
I know this might sound
like quite a hard task,
especially if you're
working a full-time job.
However, you can learn an online skill
in 20 hours of focused work
and be better than 90% of
people at that specific thing.
I'm running a free online
live event very soon
where I talk you through
what skills to master,
how to package it as a service
and send it to businesses so
you can make $10,000 a month.
If you wanna join me,
I'll leave a link in the
description so you can sign up.
And fourth, don't sit around
waiting for the government to step in,
which leads me to the third impact.
(dramatic music)
If you don't wanna be like everyone else,
then you've gotta assuming someone
or something is gonna fix this for you.
You see, if you've been through
a financial crisis before,
whether it was 2008 or the pandemic,
you probably remember
thinking at some point,
okay, this is bad,
but surely the government
are gonna do something,
and they did.
Interest rates got cut, money was printed,
stimulus checks got sent,
and things stabilized fairly quickly.
It wasn't pretty, but
there was a safety net,
and most importantly, it held strong.
But this time around,
I'm worried that that safety
net has a massive hole in it.
You see, in a normal crisis,
the first thing central banks usually do
is cut interest rates.
If you don't know what that means,
a simple way to think about it
is the price of borrowing money.
When rates are low,
borrowing becomes cheaper,
so businesses take out
loans to invest and grow,
people apply for mortgages,
money flows from left to right,
and the economy keeps going.
So when something goes wrong,
central banks cut rates to
make money cheaper to borrow,
which gets the economy moving again.
It's actually the most
common tool they use
and it normally works a treat.
But the problem right now is
you can't exactly cut rates
when inflation is rising
because cutting rates pumps
more money into the economy
and more money chasing
the same amount of goods
pushes prices up even further.
And because oil just had its biggest spike
in nearly 40 years,
inflation is rising.
So if you can't cut rates,
why not just print more money
like we did in the pandemic?
Well, the US is currently
sitting on $39 trillion
in national debt,
and the interest payments alone
come to about $88 billion a month.
That's roughly a trillion
dollars a year just in interest,
not funding hospitals,
schools, or infrastructure,
just interest.
To put that into context
because I know throwing
around trillions and billions
can feel a bit alien,
for every dollar the
government collects in taxes,
19 cents of it now goes straight
to paying interest on debt.
Think of it like someone who's maxed out
every credit card they own
and is already struggling
to make the minimum payments every month.
Would you tell that person
to just borrow more?
Of course you wouldn't,
and that's the position
the US is in right now.
Every option they have to fix the crisis
could cause a domino
effect somewhere else.
So what does this mean for you?
Well, I suggest not waiting around
for the government to make things easier.
This isn't 2008 or the pandemic
and the playbook has completely changed.
To clarify, I'm not saying it's impossible
for the government to step in and help,
but the usual interventions
just don't make as much
sense as they used to.
Now, when you put all three
of these impacts together,
rising prices, a weakening job market,
and a government with limited tools,
you start to get a scenario
that economists actually have a name for,
and that leads me to impact four.
(lively music)
Imagine it's a random Tuesday morning
and you've just found out
that your job is at risk.
Then on the same day,
an energy bill comes through your door
and it's gone up by 30%.
That's not just bad
luck, that's stagflation,
and it's one of the
nastiest economic situations
a country can find itself in,
when prices are high,
but the economy is weak,
because the tools that fix one problem
directly make the other one worse.
Most people have heard
the word stagflation
being thrown around,
but I don't think many fully
understand what it means,
so let's break it down.
This might get a bit complicated,
but I promise it'll all make sense soon,
so just stick with me.
In a normal recession,
which has happened loads
of times in the past,
the economy shrinks, people lose jobs,
and spending jobs,
but at the same time,
prices tend to come down too
as a result of the decrease in spending.
Stagflation, on the other
hand, is like the evil twin,
the economy slows down
and prices keep rising at the same time.
So your income is under threat,
but the cost of living
just keeps climbing.
Now, the tools that fix inflation,
which is typically raising interest rates,
make the recession worse.
And the tools that fix a recession,
typically cutting rates
and printing money,
make inflation worse.
It's kind of like being
stuck in quicksand,
the more you struggle,
the deeper you sink.
It's pretty crazy, right?
But let me bring it back to
you watching this right now.
US inflation just jumped to 3.3% up
from 2.4% the month before.
And Goldman Sachs has cut
their GDP growth forecast
down to 2.1.
So put simply,
prices are rising while
the economy is slowing,
which is a textbook setup
for stagflation territory.
Don't get me wrong,
I'm not saying this
will definitely happen,
but there's some interesting
data I keep coming back to
that I'd like to share with you.
There's a company called Moody's
and they've built an AI model
that's been tested against
80 years of economic data
to predict recessions.
Every single time this model has crossed
the 50% probability threshold,
a recession has followed within 12 months,
not just a few times,
every single time.
And right now that
model is sitting at 49%,
one percentage point away from a threshold
that's never been wrong.
And the worst part,
that 49% reading was calculated
before the Iran war even started.
The last time the world
dealt with proper stagflation
was the 1970s
and it lasted an entire decade.
That's 10 years of high
prices, weak growth,
and shrinking standards of
living for everyday people.
So how do you position yourself here?
Well, the key thing to understand
is that during stagflation,
cash loses value
because inflation is eaten away at it,
but risky growth investments can also fall
because the economy is shrinking.
The people who survived the
1970s best were the ones
who own things that held
their value when prices rose,
basically, real assets that people need
regardless of what the economy is doing.
I'm not saying to go out and
buy a farm or a barrel of oil,
but if your entire financial
life is sitting in cash savings
or growth stocks,
this might be the moment to
think about diversification
rather than just riding it out.
Now, one of the ways governments
typically try to escape stagflation
is by weakening their own currency,
and that brings us to an impact
that could affect every single
one of us in a very real way.
Right now, every dollar
in your bank account,
every pension payment you are expecting,
and every investment you
own is only as strong
as a system holding it up,
and as things stand,
some very large players
are starting to question that system.
The US dollar is what's known
as the world's reserve currency,
which sounds complicated,
but all it basically means
is when countries around the
world trade with each other,
they mostly use dollars,
and when governments want
to safely store wealth,
they do it in dollars.
Think of USD like the
language of global finance.
Every country speaks their
own language at home,
but when they need to do
business with each other,
they all speak the same language,
and that language is the dollar,
which is incredibly powerful for America,
but also very important
for the rest of the world.
And due to the war in Iran
plus the state of the economy,
the US is trapped between three options
and none of them are good for the dollar.
Option one is to keep
raising interest rates
to control inflation,
which would eventually bring prices down,
but in the process, likely
crash the stock market,
make borrowing more expensive,
and push the economy
into a deep recession.
Option two is to print
money to keep things afloat,
but printing money into an
already inflating economy
could send inflation into double digits,
which would eat away at
working-class people's savings.
Option three is to declare
the ceasefire a win
and step back from the Iran situation.
But if the US can't reopen a
critical global shipping lane
that the world's oil depends on,
other countries will start asking
a very uncomfortable question.
Is the US as strong as it used to be?
And do we even need the dollar anymore?
And that question is already being asked.
You see, countries don't
just hold piles of cash
and instead they store
a lot of their money
in something called US Treasuries.
If you've never heard that word before,
think of it like this.
It's basically a country
putting its savings
into a special American bank account,
and the US government then uses that money
and pays them interest on it.
For decades, it's been seen
as one of the safest places
in the world to store money,
but that seems like it might be changing
because some countries
have started pulling
their savings out.
Foreign central bank
holdings of US Treasuries
just hit their lowest level since 2012.
And instead of putting the money back in,
they're moving it somewhere else, gold.
And this is where it
gets quite interesting
because gold now makes up 24%
of central bank reserves worldwide,
while US Treasuries only make up 21%.
That's a complete reversal of
what we were seeing in 2015
when treasuries were 33%
and gold was just 9%.
Now, I'm not saying the
dollar is collapse tomorrow,
but it is worth asking,
if the smartest
and most powerful money
managers in the world
are reducing their dollar exposure,
should you at least be
thinking about doing the same?
I'm not talking about panic selling
or making any dramatic moves,
but just asking whether your savings
and investments are too
concentrated in one currency
or one type of asset,
because every single one
of those three options
available to the US weakens the dollar
in one way or another.
And a weaker dollar means
your money buys less
wherever you are in the world,
which is why people often use the term,
when America sneezes,
the world catches a cold.
And that brings me on to the final impact.
(dramatic music)
Let me ask you something,
when your grocery bill went up recently,
how did it feel?
For some people watching this,
it was annoying,
maybe a bit jarring,
but overall, just something
you noticed and absorbed.
And for others, it raised questions like,
can we still take the
kids out this weekend?
That gap between annoying
and life-changing
is exactly what I wanna talk about,
because an economic crisis
doesn't land the same way
for everyone,
in fact, it's not even close.
I wanna be upfront here,
this isn't a political point,
and I'm not approaching this
from any particular ideological angle,
I just wanna walk you through the numbers
because the story they
tell is quite damning.
If you are on a lower income,
energy and food don't just take up
a bigger chunk of your budget,
they completely dominate it.
Research shows that low-income households
spend almost 33% of their
income on food alone
compared to about 13% for
middle-income households.
So when oil doubles and food prices jump,
someone earning a high
salary notices it, sure,
but someone on a lower
income fills it in a way
that changes their daily life.
It's the difference
between checking the price
of petrol out of interest
and wondering if you can
afford to drive to work.
Now, the obvious response is
that governments should step in
with subsidies and price
caps to protect people,
but here's what actually
happens when they do that.
During the Ukraine energy crisis,
95 of the world's biggest
food and energy corporations
made $306 billion in unexpected
profits in a single year,
and 84% of that went
straight to shareholders.
Think about what's
actually happening there.
The government takes money from taxes
and uses it to cap what
people pay for energy.
Meanwhile, the energy companies
keep charging full price
to the government and
pocketing the difference.
The money meant to protect ordinary people
ends up flowing to the people
who already own the energy.
It's like filling a bucket
with a massive hole in the bottom.
You're pouring as much in as you can,
but the water's going somewhere
you never intended it to.
It's the same pattern over and over.
During the recovery of the
2008 financial meltdown,
the top 1% of US earners
captured 95% of all income gains
during that period.
The reality is the middle class
are being squeezed out of existence
and nobody is coming to save you,
that's why you need to take responsibility
for your own income,
especially in times like this.
So please take advantage
of all the videos I've got on my channel
because those that level
up their skill sets
and financial knowledge
will come out of this storm
stronger and richer than ever before.
If you wanna know why I'm changing
how I invest my money because of AI,
then I'm gonna leave that
video right up there.
But don't click on it just yet,
make sure to subscribe if you
wanna grow your wealth, okay?
I'll see you over there.