Before the Wars, Before the Virus — Do You Remember What Normal Felt Like?
There was a time — not that long ago — when oil was $60 a barrel and nobody thought twice about it. When the Strait of Hormuz was just a geographic term in a textbook. When the biggest market worry was whether the Fed would cut rates by 25 or 50 basis points. When Bitcoin moved on ETF rumors, not on whether a ceasefire in Islamabad would hold past Tuesday.
That time was January 2026. Three months ago.
Go back a little further. Before the U.S.-Iran war. Before the Strait of Hormuz became the most watched waterway on earth. Before Russia's invasion of Ukraine sent European gas prices into orbit. Before COVID-19 shut down the global economy and rewired every supply chain on the planet. There was a version of the world where geopolitics was background noise — something analysts discussed in footnotes, not something that moved your retirement account by 5% in a single afternoon.
That world is gone. And the sooner investors accept that, the better their portfolios will survive.
Consider where we are right now. The U.S. Navy has deployed 41% of its total fleet to the Middle East — 27 warships including three carrier strike groups led by the USS Abraham Lincoln, the USS Gerald R. Ford, and the USS George H.W. Bush, now en route from the coast of Africa. Stars and Stripes reports over 16,500 Navy and Marine Corps personnel are active in the region. The blockade of Iranian ports, which the Pentagon says is "fully implemented," has halted all maritime trade going to or from Iran within 36 hours of the order. Eight vessels have been stopped and turned back. The WSJ confirmed that over 20 commercial ships transited the strait in the past 24 hours — a recovery from the near-zero traffic of last week, but still a fraction of the pre-war average of 135 ships per day.
Meanwhile, the diplomatic fractures are multiplying. Italy — one of Trump's closest European allies — suspended its defense cooperation agreement with Israel after Israeli strikes killed 357 people in Lebanon during the ceasefire. Over one million European citizens signed a petition demanding the EU cut all cooperation with Israel. Poland's parliament saw a lawmaker unfurl an Israeli flag overlaid with a swastika. Trump publicly attacked Italian Prime Minister Meloni for refusing to support the Iran campaign. Meloni fired back that "strategic allies must have the courage to disagree." And in Washington, Lebanon and Israel held their first direct talks in 33 years, mediated by Secretary Rubio — while Israeli forces simultaneously entered the southern Lebanese city of Bint Jbeil, killing at least 35 people in 24 hours. Hezbollah rejected the talks entirely.
This is not a backdrop that resolves cleanly.
Yet the market acts as if it will. The Nasdaq has risen for 10 consecutive days — its longest streak since 2021. The S&P 500 closed at 6,967, within 0.3% of its all-time high. Bitcoin touched $76,000 on a $650 million short squeeze triggered by softer-than-expected PPI data. Goldman Sachs posted a record quarter. JPMorgan beat estimates across the board. WTI has pulled back from $104 to $91. Everything suggests the worst is over.
But the market has a pattern of pricing in peace before peace actually arrives. It did it in February 2022, when European equities rallied the week before Russia invaded Ukraine. It did it in late 2019, when stocks hit record highs just as COVID-19 was spreading unseen through Wuhan. The market is an optimism machine — it discounts the best-case scenario by default and only reprices when forced to.
Right now, the best-case scenario has a six-day shelf life. The ceasefire expires April 21. Turkey is mediating, but neither the U.S. nor Iran has committed to a second round of talks. Polymarket gives only a 26% chance the truce holds through that date. If it collapses, oil retests $104-$110. If Israel's Lebanon campaign escalates, NATO's fractures widen further. If the PPI softness proves temporary — and with oil still 53% above January levels, it very well might — the Fed's pause turns into a prison.
The timeline of escalation is worth reviewing. In 2019, the global economy was humming. Then COVID hit in early 2020, erasing $16 trillion in global GDP over two years. Recovery had barely stabilized when Russia invaded Ukraine in February 2022, sending Brent crude above $120 and triggering the worst European energy crisis since the 1970s. Interest rates surged worldwide. Inflation peaked at 9.1% in the U.S. By 2024, things were normalizing — inflation fell, rates were expected to drop, oil settled in the $60-$70 range. Then came February 28, 2026, and the U.S.-Iran war. Oil doubled. The Strait of Hormuz closed. Gold topped $4,800. The 10-year yield stuck at 4.3%. And here we are.
Three crises in six years. Each one was "unthinkable" until it happened. Each one was "priced in" until it wasn't.
So what does the investor who misses peace actually do? The same thing we've said in every post on this blog: protect your capital first, grow it second.
Do not take loans to invest. Do not leverage with money you cannot afford to lose. If you are a small investor, your greatest advantage is not speed or information — it is the ability to wait. Institutions cannot sit in cash for six months. You can. A money market fund at 3.5% is not exciting, but it is real, and it does not evaporate when a drone crosses the Strait of Hormuz.
If you are already invested, hold quality positions and let earnings do the lifting. JPMorgan's $5.94 EPS and Goldman's $17.55 are proof that corporate America can generate profits in a war economy. But do not add to positions aggressively at all-time highs with a ceasefire expiration six days away. Dollar-cost average — small, fixed amounts, weekly — and let time do what timing cannot.
The world before COVID, before Ukraine, before Iran — it's not coming back. But the principles that worked in every era still apply: diversify, stay liquid, avoid leverage, and never confuse a 10-day winning streak with safety. The Nasdaq's rally is impressive. The headlines from Hormuz, Beirut, and Rome are a reminder that rallies built on hope require hope to continue.
Peace may come. But your portfolio shouldn't depend on it.
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