At 1:15 a.m. ET on Sunday morning, the U.S. and Israel launched their opening strike on Iran as Ayatollah Ali Khamenei met with his inner circle. More than 1,000 targets have already been hit.
And with it begins the execution of the “grand bargain” struck between the US and Saudi Arabia.
This morning, timed with the East Coast commute, Air Force General Dan Caine, Chairman of the Joint Chiefs of Staff, gave a press conference on Operation Epic Fury.
The official objective is to destroy Iran’s nuclear and ballistic-missile capability, damage its navy, and break the machinery behind its proxy network of terrorists. Hamas, Hezbollah and the Houthis are among them.
Epic Fury’s top brass says the operation could last four to five weeks and warned that “the big wave” still lies ahead.
You may recall, on February 18, 2026, when carrier groups and cargo flights were piling into the Gulf, we described the details we believe is a grand bargain between President Trump and Saudi Crown Prince Mohammed bin Salman.
Washington provides steel, tech and strategy. Riyadh will continue the 50-year deal to back the US dollar with oil.
First Venezuela’s Maduro… now Iran’s Khomani.
In two engagements, the U.S. military (in conjunction with Israel) has practiced what John Robb, Grey Swan contributor and adviser to the Joint Chiefs on ‘netwar’, calls “Kinetic Decapitation.”
(More on Robb’s analysis below. He’ll also be joining us for Grey Swan Live! this week.)
Saudi Arabia will get a seat at the AI-powered global economy in the bargain, too.
Since February 18, Nvidia, Microsoft and Amazon and Musk’s xAI have all agreed to build, are currently building, or have recently opened data centers in Saudi Arabia as part of the kingdom’s Vision 2030, which aims to make the nation a global AI hub.
The weekend’s Epic Fury made the grand bargain easier to see.
For now, the market appears to have already anticipated the military action. Other than some squirrely price action in oil because of the Strait of Hormuz, you wouldn’t know from the indices much of anything happened over the weekend.
Ras Laffan, Ras Tanura and the Price of Disorder
Qatar halted LNG production at Ras Laffan after Iranian attacks. Saudi Arabia shut the 550,000-barrel-per-day Ras Tanura refinery as a precaution after intercepting drones and containing a debris fire.
Tankers backed up near Hormuz. War-risk coverage started to disappear. Oil traded above $82 a barrel, and European gas prices surged.
That is where this war touches the rest of the world: not first in speeches, but in terminals, shipping lanes and the insurance market.
The global economy still runs through pipes, ports and chokepoints.
The Gulf remains the hinge between old energy and new industry.
Data centers need power. AI needs a stable infrastructure. The dollar system still prefers secure shipping lanes and orderly settlement.
Washington wants the Gulf calm enough to keep that architecture standing while the next layer of digital finance gets argued over in committee rooms and bank lobbies. Riyadh wants security, leverage and a larger chair at the table when the AI buildout starts choosing permanent winners.
MBS Is Buying a Seat in the Machine Room
Mohammed bin Salman’s White House visit concluded on November 18, 2025. The deal discussed centered on defense, AI, civilian nuclear cooperation and a deeper strategic partnership.
Reuters reported then that Trump intended to approve F-35 sales to the kingdom and that the two sides were preparing agreements covering defense, civil nuclear energy and major Saudi investment in U.S. AI infrastructure.
Saudi Arabia is no longer content to collect oil rent and send polite delegations to conferences. The kingdom’s 2030 vision includes computing power, data-center scale and global recognition of their strategic relevance.
If you’ve been following along, the grand bargain also increases the critical importance of passing the Clarity Act and putting the US dollar, and global reliance on U.S. Treasurys, at the forefront of innovation in the digital asset space; the future of the global AI economy.
In the Dollar 2.0 scenario, the petrodollar does not retire because a senator discovers stablecoins and a lobbyist drafts a memo.
In a very direct way, Epic Fury adds urgency to the debate between the banking cartel and the innovators on the front line of the digital asset evolution… the companies that sit in our Dollar 2.0 portfolio.
Until Washington settles the regulatory battle impeding the passage of the Clarity Act in the Senate, energy security and military strategy remain the heavy timbers holding up the barn… the old frame still carries the load.
Kinetic Decapitation and the New Style of War
“If U.S. intelligence can identify one room in Tehran holding the Ayatollah and dozens of senior officials,” observed our friend James Kunstler this morning, “it can probably identify missile-launch sites too.”
Kunslter’s larger point is that once Iran’s command and control begins to fray, retaliation becomes ragged, local, and theatrical.
That may overstate the speed of collapse. It captures the character of the effort. Regimes can remain dangerous after they stop looking competent.
The Revolutionary Guard can still swat at tankers, refineries and weak points around the Gulf. We’ve already seen dozens of reports of missiles and drones lashing out from Iran at soft targets in Syria, Iraq, Kuwait, the Emirates, Bahrain and in Saudi Arabia itself.
Grey Swan’s John Robb’s term for this is “networked systems disruption.”
The phrase sounds clinical until it reaches real infrastructure. But the logic is simple enough.
In modern war, rhythm is often the first casualty. You do not need to occupy a state to cripple it. You hit the node: the command center, the port, the telecom relay, the refinery, the leadership meeting, the insurance confidence behind the shipping lane.
The strike of Epic Fury, Reuters reported, was timed to nail a meeting of Khamenei’s and his top aides.
Following that, Robb’s analysis deserves attention.
Once one defensive method proves effective, it travels. Cheap drones, AI-assisted targeting, and wider surveillance lower the cost of breaking systems.
In other words, the Strait of Hormuz does not need to be formally closed for the damage to begin. Commercial traffic only has to become risky enough that the men writing policies in London decide they would rather not bother.
In a tight energy market, partial disruption can do the work of a blockade. Oil spiked nearly 10% at the open of trading on Monday morning. Sustained, uncoordinated attacks could see additional price volatility in the oil price and shipping rates.
If the “big wave” of Epic Fury is still weeks away, any price volatility is on a “wait and see” basis.
Washington’s Fuzzy Math, An Addendum
Pentagon officials have already told Congress there was no intelligence showing Iran was preparing to attack U.S. forces first. That’s, of course, irrelevant to the strategic mission of Epic Fury. Or, the grand bargain.
The usual suspects in Congress are already complaining that Trump has acted illegally. He must appeal to Congress to activate the nation’s war power… Otherwise, how will they get a chance to vote ‘no’? The public sales pitch is always cleaner than the private file.
In Washington, that habit and legislative debate cycle predates most of the buildings. The arithmetic underneath it is all too familiar. With apologies to Hemingway: Inflation taxes the currency. War taxes the future. Both enrich the connected. Both leave a bill tucked under the plate.
Gold Keeps Receiving the Guests the Dollar Offends
The dollar remains the dominant reserve currency, but gold keeps moving up the seating chart.
The final elements of Basel III – often called Basel 3.1 or the “endgame” – were originally scheduled for implementation on January 1, 2023, but were delayed. Most jurisdictions are now implementing them between 2023 and July of 2025.
The agreement makes gold as liquid an asset as the US Dollar or US Treasuries. As of September 2025, approximately 80% of member jurisdictions have implemented the revised credit, operational, and output floor standards needed to accumulate and house gold.
Global gold purchases by central banks have risen along with Basel III’s acceptance.
Last month, we showed that gold had overtaken the euro as the second-largest reserve asset in central bank portfolios. Reuters also recently reported that central banks now hold roughly 36,000 tons of gold after three straight years of purchases above 1,000 tons annually.
The accumulation of gold has driven the spot price up accordingly.
The bull market in gold matters this morning because military assets are in motion and Gulf energy markets have been rattled… Saudi Arabia’s strategic capital in the region is climbing, and the global reserve architecture for central banks – dollars and gold — is being hedged around the edges.
In the Grey Swan Trading Fraternity, one open trade on a gold mining company is almost at triple-digit returns. “We don’t want to chase gold now that’s it’s moving higher, and oil prices are susceptible to headline changes,” notes portfolio Director Andrew Packer. “But other commodities are looking attractive right now given geopolitical events.”
These are connected moves. Energy, security, capital, and trust run through the same circuit. Epic Fury puts all the grand bargain and Trump’s Great Reset strategy in full view of the day’s headline news.
Keep One Eye on the Horizon
The March 2 picture is clearer than when we introduced the grand bargain a month ago.
The Saudi security and AI alignment with Washington looks real. But Iran can still raise the price of disorder while taking heavy blows for now.
Modern conflict is looking more like selective paralysis than old-style occupation. The dollar still runs the table, but gold keeps finding its way deeper into the room. Those are the pressure points this morning.
For now, the useful thing is to watch the flows: oil through Hormuz, gas out of Qatar, Saudi capital into AI, and gold into central-bank vaults. That is enough to work with for one Monday.
Oh, and pass the damn Clarity Act.
~ Addison
P.S. Thank you if you joined us on Friday for a special Grey Swan Live! from inside the Rarcoa Vault in Chicago.
Owner Wayde Mills gave us a display and tour of coins never on view for the public. And showed us behind the scenes how rare coins as an asset class offer a unique way to protect your wealth – and they carry the added value of rarity, mint, condition and historical significance.
Wayde Milas gave us nearly two hours of time to explore some of the great coins of history, some new products that Rarcoa is developing, and a special opportunity for Grey Swan members: a 2025 Eagle Privy Silver Eagle graded NGC MS70 — from the first group of 50,000 pristine minted coins — which he offered to Grey Swan members at a wholesale discount.
