{"id":330315,"date":"2026-03-09T19:07:10","date_gmt":"2026-03-09T19:07:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/330315\/"},"modified":"2026-03-09T19:07:10","modified_gmt":"2026-03-09T19:07:10","slug":"stock-market-meltdown-risks-are-surging-due-to-stagflation-ed-yardeni","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/330315\/","title":{"rendered":"Stock Market ‘Meltdown’ Risks Are Surging Due to Stagflation: Ed Yardeni"},"content":{"rendered":"

The oil scenario<\/a> markets have feared is here, and it risks derailing the stock market’s bull run, according to a longtime strategist.<\/p>\n

In a note to clients on Monday, Ed Yardeni, president of Yardeni Research, pointed to the\u00a0spike in oil prices<\/a>\u00a0driven by the war in Iran. He said he believes there is now a higher risk of a stock market “meltdown,” a scenario he’s previously described as similar to the market crash of the early 2000s.<\/p>\n

The sharp rise in crude has also raised the risk of stagflation<\/a>, a scenario in which inflation soars while economic growth slows. It’s a dire combo that is often regarded as the worst-case scenario for the economy. <\/p>\n

Yardeni said he believed the risk of a stock meltdown had increased to 35%, up from 20% previously. That compares to just a 5% chance of a stock “meltup,” a situation where stock prices climb rapidly.<\/p>\n

The US economy also now has a 15% chance of seeing a “Stagflating 1970s Redux,” a repeat of 70s-style stagflation that wasn’t on Yardeni’s radar before.<\/p>\n

“Spiking oil prices<\/a> may precipitate a stock market correction rather than a bear market, but the latter is possible,” Yardeni said. “We can’t rule out a bear market if investors start to anticipate a Stagflating 1970s Redux scenario,” he later added.<\/p>\n

Investors have been fearing the repercussions of higher oil prices<\/a> since the US and Israel first struck Iran, one of the world’s largest crude producers. Given how deeply oil is entrenched in the US economy, the fear is that higher oil prices could raise inflation while hurting demand, resulting in a stagflationary dynamic that could dent growth at a time when it was already slowing down.<\/p>\n

Oil price shocks have typically been associated with recessions<\/a> and bear markets<\/a> in the past, Yardeni noted. He referenced the spike in oil prices after the 1979 Iranian Revolution, which caused US inflation to soar to 14% in 1980 before the economy entered a sharp downturn.<\/p>\n

Hotter inflation also means the Fed has less room to cut interest rates, a major catalyst investors have been relying on to carry the stock market higher.<\/p>\n

“The US economy and stock market are stuck between Iran and a hard place currently,” Yardeni said. “If the oil shock persists, the Fed’s dual mandate would be stuck between the increasing risk of higher inflation and rising unemployment,” he added of the murky outlook for rate cuts going forward.<\/p>\n

Despite increased risks to the downside, Yardeni said his team was still expecting relatively little impact from the war. His firm’s “optimistic view” sees the conflict lasting for several more weeks, during which economic growth and corporate earnings will remain resilient.<\/p>\n

For stocks, he sees a 10% to 15% correction stemming from high oil prices as likely, but pegs a 60% chance the market will continue to see a “Roaring 2020s<\/a>” scenario, with stock prices climbing alongside a boom in productivity.<\/p>\n

The Iran war has soured the broader outlook on Wall Street, which had already been hit by a sharp sell-off in tech stocks to start the year. Beyond $100 a barrel, which crude hit over the weekend, market pros see prices potentially rising to $120 a barrel<\/a>, a situation some have said could be the trigger for a recession.<\/p>\n","protected":false},"excerpt":{"rendered":"The oil scenario markets have feared is here, and it risks derailing the stock market’s bull run, according…\n","protected":false},"author":2,"featured_media":330316,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,184,85,46],"class_list":{"0":"post-330315","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-il","11":"tag-israel"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/330315","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=330315"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/330315\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/330316"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=330315"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=330315"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=330315"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}