We’re not used to so many things going wrong at the same time, especially when, as the days go on, they can’t suddenly go right. Moreover, we can’t process something that seems unfathomable — a short war —when the calendar says it’s no longer short. We also can’t adjust to the notion that no matter what we do —as in the United States and the Israelis as allies — we can’t defeat what we thought was a country in Iran with limited war-making abilities. The efforts we have made, the bombings we’ve delivered, and the brazen assassinations the Israelis have wrought, seems to have emboldened the opposition, leaving us to think Iran can create limitless damage. Oh, and the 10-year and 30-year Treasury yields are marching higher — with some, if not all, those gains related to concerns that disruptions to the impossibly complex supply chain beginning in the Gulf will rekindle inflation. Higher rates means the pain from the war has spread from the directly impacted to pretty much everyone. The exception, of course, is the oil companies that get a free ride off the hostilities. Makes you want to own Chevron , ConocoPhillips and Exxon Mobil , plus a couple of robust domestic oil and gas companies and nothing else. It’s a great time to be a hedge fund, an awful time to be a long-only investor, and a truly miserable time to run a charitable trust, hamstrung by no ability to short stocks, limited ability to take quick, evasive action — If I mention a stock on TV, we can’t trade it for 72 hours — and no desire to raise cash beyond the incredibly high 15% level we had last week. US10Y YTD mountain The 10-year Treasury yield in 2026. The war in Iran began Feb. 28, and the spike in yields coincides with that date. Plus, the fluidity of the situation is completely unnerving. Initially, with the killing of Ayatollah Ali Khamenei and other Iranian leaders and the laying to waste of Iran’s missile and drone capacity, a short war seemed on the table. We heard endlessly about how our military took out Iran’s launchers and their missile defenses, leaving the country without its ability to stop our offensive weapons from creating havoc. But then Reuters reported on Friday that the U.S. can only confirm a third of Iran’s missile arsenal has been exhausted, leaving us to believe they have more firepower than we do. By the end of the week, we realized we have a long war ahead that has gotten beyond the grasp of a president who thinks we have fought wars and didn’t mind losing them, and Donald Trump is not one of the presidents who let that happen. That’s for other, less-equipped occupants of the Oval Office. The result: We have gone from the manageable to the unthinkable in four weeks, a quick set of airstrikes to potential boots on the ground that leads to a protracted conflict with no allies. It’s a nightmare that will end like all of the geopolitical encounters where oil goes up roughly 100% in a short time, leaving us with a stock market that has always gone down at least 20%, as JPMorgan Asset Management’s Michael Cembalest highlighted in his recent “Eye on the Market” dispatch . U.S. oil benchmark West Texas Intermediate crude settled Friday at $99.64 a barrel, its highest close since July 20, 2022. Since the start of the war on Feb. 28, WTI is up 48.67%. Normally that would lure us into safe havens, like bonds, consumer staples and utilities. Each, however, has its flaws. You can’t own bonds when you are now pondering the possibility of a rate hike to squash oil-driven inflation. The staples largely have declining earnings power. And the utilities have already run a bunch thanks to the AI buildout, so they are uneven in their advances. Some of the worst stocks, of course, are the once-loved megacaps in the tech world. We went over these extensively at the Monthly Meeting on Friday , but understand they are more caught up in the inflationary undertow than in the earnings-reduction thesis. How to proceed So, what can you do? I think that as long as the S & P Short Range Oscillator is not quite oversold at minus 3.6% and history dictates a 20% market decline is a real possibility if oil keeps climbing, it’s not too late to raise cash. Yes, there is always the possibility that Iran gives up the Strait of Hormuz and stops firing missiles, something that would end the war. But I would argue oil doubling from its pre-war levels is more likely. Once again, for us, though, we are not a hedge fund — something that, when we are in bear market mode, as we are now, makes us feel as helpless and angry as you saw at Friday’s meeting. The difficulty, as I see it, is that we no longer know what causes to war to end. Will Trump really just declare that it’s over without an agreement that Iran scrap its nuclear program? Is simply reopening the Strait of Hormuz to all maritime traffic a victory? Will Iran really roll over and play dead like that, though? I don’t think so. It’s the perfect recipe for further declines. It is so perfect that we find ourselves wishing we could get there. We tire of whatever “Trump put” we may receive. Just get “it” over with, even if we never knew what “it” really meant. We find ourselves in the now asymmetrical position of wanting to head to the exits, albeit somewhat reluctantly, because there is always the possibility of real talks between Washington and Tehran, and perhaps Iran really does want to give in despite its seemingly limitless military capacity. That’s different from the previous narrative, which was something like this: The war will be won soon, rendering it too difficult to get out out of the market and then get back in, so why bother to leave. Remember that? Because of that switch, I detect both an ennui and a palpable dislike of this market. We don’t want to get out and get back in. We just want to get out. There are now plenty of people who think this just isn’t a reprise of Liberation Day tariffs, but rather something far more sinister that will take your gains away because things have gotten so ugly so fast. Tech spotlight There’s a chorus of commentators marveling at the decline in tech, especially within the “Magnificent Seven.” But more nuance is needed. It’s not all of tech or the Mag 7. It’s not the whole data center trade, even as those stocks have managed to cling to their runs. Sure, we’ve seen the red-hot memory and storage names come back to earth a bit , in light of Google’s new compression algorithm for AI models. However, the declines are minimal versus their two-year runs. Those stocks are coming down out of fear. Remember, I always preach that you need to trim stocks experiencing parabolic moves to protect some profits. Really, the worst parts of tech are all hit-and-run AI. Consider the some of the biggest losers in the S & P 500 in 2026. There’s TurboTax parent Intuit , down 37%. That’s all because of a belief that Anthropic’s Claude can do your taxes with ease. As is many a case with an Anthropic product, it’s almost completely untrue. The vast majority of the people in the country need help with their taxes, either through a service like Intuit or the government itself. It would be hilarious to acknowledge how few things Anthropic does better than the human-led status quo right now. The idea that consumer taxes would be one of them is hard to contemplate. Still, Intuit’s stock has indeed been destroyed by Anthropic concerns. One of the terrific things that will make me want to own the stock of Anthropic, if it follows through with reported plans for an IPO, is that it never has to say it is sorry about making all sorts of claims of competence where it has no real competence, like cybersecurity. Another major laggard is Applovin , which went from having no competitors in placing ads across mobile apps to being hurt by actual AI competition. The stock is down 43.4% and, unlike Intuit, it has no real support on the Street, so I suspect it goes lower. Gartner is also a big decliner, dropping 38% so far this year. I regard Gartner, research and advisory firm, as a benchmarker. AI does terrific benchmarking. Enough said there. Workday is down 42%, an exemplar of the carnage in software-as-a-service (SaaS) companies serving the enterprise. I suspect you could replicate Workday’s programs with AI. At least, the sellers sure think that’s true. Brokerage app Robinhood has prime real estate on 2026 loser island. It turns out that no matter how you slice it, Robinhood was, primarily, a crypto trading company. The crypto traders first moved on to gold, and then left the precious metal and went to prediction markets. They can buy back all the stock they want. The move $154 a share last fall was on the back of crypto and, to a lesser extent, options activity. Now this is a $66 stock, down 41.6% year to date. The worst performer in the entire S & P 500 is actually Trade Desk , down a pinch more than Applovin as of Friday’s close. Trade Desk placed ads. They placed them more expensively than competitors Google and increasing Amazon, which now use AI. Incredibly, the SaaS company that is thought to have the best artificial intelligence capabilities is ServiceNow . But that stock is still down 35% year to date. If you go down the loser board a bit further, you’ll see companies that are a little less ruined by AI, but almost all have some component of destruction, real or perceived. But when you get into the meat of the decline, you don’t find tech and you don’t see AI roadkill. You see stocks that are hurt by higher rates or the possibility that we won’t have rate cuts. And it is there that the real bull case can be found by the war ending. The inflation predicament If you go back to before the war, we were having one of those nascent rate rallies that are a must for any portfolio manager to catch. Lots of people thought inflation was on the rise during this period, but the breakdown of the consumer price index (CPI) in January revealed a softer-than-expected increase, with hotter areas clustered around clothes, shelter and food. For clothes, we’re about to annualize the implementation of Liberation Day tariffs. Rents are coming down in many American cities . Food is tough because of meat. The problem is intractable as we have the smallest cattle herd in 75 years . Cattle ranchers are dealing with drought, disease and high feed costs. They won’t come down. In the meantime, we have not been hurt nearly as badly in the U.S. versus other countries when it comes to rising prices for natural gas, which heats the plurality of homes in the country. The data centers have, selectively, raised electricity prices but that tends to be because of poor regulation. The states with the highest rates have utility rate commissions that do not seem to be able to come to grips with how to charge the data center operators. Texas data centers, though, have produce virtually no increases in price. Nevertheless, higher gasoline prices have drowned out any hope of a rate cut among the chattering classes. I think Trump’s Federal Reserve chair nominee, Kevin Warsh, can easily get cuts through, assuming he’s confirmed and takes over for Jerome Powell, whose term ends in May. Right now, bond yields — and the borrowing costs they influence, such as mortgage rates — are going higher because of war-driven inflation concerns. We all recall the way that supply chain problems led to an inflation spike in the Covid-19 pandemic era. It’s easy to imagine why people are concerned again. That is also why it is easy to imagine that rates could come down if the war ends. You get tariff annualization and a return to gasoline normalcy, then you get rate cuts when Warsh comes in. Until then, I think every stock market decline will be exacerbated by the inexorable rise in rates. Not good. It could be counteracted by a weaker employment number, given a slowing economy generally coincides with falling yields as investors seek out safety (bond yields move inversely to prices). Tech companies are laying off people and causing people to be laid off . It could matter. I don’t see employment getting in the way of rate cuts. But gasoline will make it so employment weakness like I expect from this Friday’s nonfarm payrolls report won’t matter. Bottom line As it stands, as long as the war goes on, it’s mighty hard to think of a reason to stay invested in stocks. Too many cross-currents and inputs that make it so stocks could repeat what happens when oil doubles: a 20% decline. We are nowhere near that yet, with the S & P 500 ending Friday roughly 9% below its late January all-time high. But I would expect we would fall that far if WTI crude hits $120 a barrel. We all know, secretly or out loud, that is in the cards. Too much oil is off the market. So, it’s a footrace. If the war isn’t over, I think oil takes us to $120, which then means that stocks will continue to get clocked with the worst ones being those that are actually being hurt by AI or don’t do well when rates go higher, a gigantic cohort. Keep thinking that a double in oil has historically produced a 20% decline in stocks and be mentally prepared for that. But if the war ends, oil immediately plummets, the tariffs get annualized, the CPI steadies itself, the labor market gets weaker still from AI and proactive layoffs by companies that fear higher rates or generative AI, and you might get a real barn-burner rally. The key is the one thing we don’t know: does the president want to win the war, or declare victory on a stalemate? Either way brings a rally. If it’s the former, we will first see 20% down for the S & P. If it’s the latter, you will wish you bought starting next week. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. 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