Oil prices are no longer the biggest threat to the market.

It is increasingly clear that the bond market will determine how long President Trump can continue to escalate pressure in his conflict with Iran.

The 10-year bond yield has risen approximately 45 basis points since the conflict began on February 28.

This aligns with the sharp spike seen around "Liberation Day" in April 2025.

When the 10-year bond yield spiked above 4.50% in April 2025, President Trump began suggesting the possibility of a tariff "pause."

And, once the 10-year bond yield exceeded 4.60%, President Trump officially implemented a 90-day pause on retaliatory tariffs on April 9, 2025.

With the 10-year bond yield currently at 4.40%, we believe the range from 4.50% to 4.60% will again be the "final limit."

The U.S. economy cannot sustain a 10-year bond yield at 5%.