Blain’s Morning Porridge 18th March 2026: What Matters? Energy Security and Defence
“Sometimes it is necessary to lose a battle to win a war”
The last two weeks have been fascinating. Iran increasingly looks a strategic blunder by Trump in the wider global hegemonic struggle between the USA and China. It increases the likelihood of instability, trade and economic disruption and the threat of kinetic conflict. Boy Scout time: Be Prepared.
Apologies for the lack of Morning Porridge y’day and the slightly late comment today. Service will be slow in coming days – I’ve been floored by Man-Flu – the single most destructive force in the Universe. If I could spend the day sleeping it off I would… but the coughing, sneezing and sinusitis keeps me awake. I am turning into a Sleep Zombie, unable to snooze but glued to my screens watching the globe in turmoil…. Or something like that. (I’m wondering how I’ll cope this weekend – the last long ski weekend of the season!)
At times like this remember Blain’s Market Mantra No 2 – “Things are never as bad as we fear, but seldom as good as we hope.”
Strip out the noise. Take a close look at what’s broken and figure out how the shards of the splintered markets will come back together again – they always do. At the macro level, we’re experiencing another energy shock. It means readjustment, recalibration, pain and tribulation, and markets finding new levels. Inflation looks to be nailed on – with massive implications for bond markets, and therefore relative pricing across all risk assets. New supply chain instabilities are inevitable as the world adjusts.
Periods like this are rife with opportunities for traders and nations brave enough to take them. But the current self-inflicted global instability is happening right when leading global long-term chartists predicted it would – and I suggest you check out my chum David Murrin’s writings. He has called it perfectly thus far, predicting how today’s tensions would coincide with the 2K (120 year) cycle of hegemonic change – a period rife with conflict threats as China challenges the USA for global leadership. This is the new reality – global hegemonic change and how that plays out.
My read on how the future develops is simple – two things will be critical in the coming decade: Energy Security and Effective Defence.
The nations that can get these right will likely thrive – able to avoid destabilising conflict through strategic deterrence, and growing economies based upon resilient energy networks enabling tech, commerce and industry. At the moment, that’s a massive ask for Europe – which is decades away from achieving either.
As for the USA? The USA is undoubtedly the strongest Military Power on the planet. But knowing how to use power is the critical factor. As Iran is demonstrating, it’s fine to carry a big stick, but knowing how to use it is the critical thing. Let’s take Sun Tzu’s most simple concept as our text this morning: “The highest form of generalship is subduing the enemy through strategy, psychology and diplomacy rather than direct battle.”
What marks would you give Trump’s showing in Iran? He’s giving a master class in swinging the club into his own face. The rest of the world is either horrified or laughing out loud at the trap he’s walked into because of the lack of clear strategic thinking or objectives. If that sounds harsh or unfair – nope. It’s what’s demonstrably happened.
My MAGA friends in the US tell me he’s winning because the Iranians are firing fewer and fewer missiles and drones – because Air Power is taking out all the launch vehicles. But that does not make the Strait of Hormuz safe. They are less inclined to discuss Trump’s chances in the Midterms just 7 months away.
2 weeks ago, I reminded readers of the Roman Triumvir Crassus. In 53 BC he calculated invading Persia would restore his political lustre. It didn’t. He was slain. As were the 7 legions that accompanied him when he ignored the advice of his local allies and led his force into the desert where they were surrounded by light calvary. The legions formed a defensive square but were weakened by a lack of water and Persian archers, before they were destroyed by the Persian Cataphract heavy cavalry.
History does not necessarily repeat, but it does resonate. This time Trump attacked in support of Israel against the advice of the Gulf States. Then, as now, the alternative to losing was to win by not fighting. Trump attacked, keen to demonstrate his power expecting vindication and a repeat of his Venezuela success.
The USA will not be beaten in the field by Iran, but it is still losing the war that counts – in economics. Its position as Global hegemon is compromised as its credibility is increasingly questioned – which has massive dollar and treasury implications. Over the last two weeks Trump has demonstrated his unparalleled skills in how to not make friends and influence nations. While I am sure the next American President will move heaven, earth and the satellite-sphere to rebuild America’s now broken global alliances – the reality today is the US is now militarily isolated, over-stretched, facing logistical bottlenecks and is fully engaged on a battlefield of its enemy’s choosing – the deserts of Iran.
China, the challenger, hasn’t fired a single bullet. Its sitting, bidding its time, watching America empty its arsenal.
Many folk say watching Trump is like watching a toddler. I disagree. Don’t watch Trump – he is not the cause; he is just a symptom. But be very aware of the tremblors – the little pre-shocks that proceed a potential Earthquake. That’s why listening to the developments at the micro-level is so interesting. Trying to work out how they will tip the balance, and affect markets is critical.
Energy is critical. The financial beneficiaries of the Iran war seem to be rogue states Iran and Russia from rising prices for their illicit oil. There is now talk of Europe reopening energy deals with Russia– which sounds like a ploy to surrender support for Ukraine. Trump claim’s the US is energy independent, but it is not. Its’ much-vaunted nuclear reactor fleet is dependent on Russian Uranium supplies.
Stop me if you see a trend. Russia is supporting Iran drone attacks with tech, supply and targeting. No Sh*T Sherlock to the WSJ for spotting that one. Yet Trump now threatens to abandon Nato and Ukraine. Who is pulling who’s strings here?
Trump’s internal supports are cracking. In times of great crisis great leaders focus on the big picture, while disorganised rabbles focus on the details. Which is why I find the reaction to resignation of a single Trump supporter, Joe Kent, (nope, never heard of him till yesterday), over the attack on Iran to be salutary. For the next few days except to see the MAGA faithless endlessly debate the treachery of the man and whether the Zionist Israeli Kabal have tricked Trump into misinformed unwinnable war.
America politicians are ravening wolves. They will scent weakness. Given the American appetite for conspiracy, fake news and righteous indignation… it will be fascinating watching how this play outs domestically in coming weeks.
Globally – keep an eye on the pulse of markets and invest in defence and energy.
Out of time and off for yet another Lemsip…
Bill Blain
Author of the Morning Porridge
Advisor – Spitfire Strategic Capital
