The uncertain situation in the Middle East poses a potential risk to the US economy

President Trump recently publicly discussed the most important decision he may make during his term, which has attracted widespread attention. The decision involves high-stakes consequences that could affect the US and global economy. Trump told reporters at the White House: "I may take this action, or I may not," which has led to speculation about the potential changes that may result from this decision.

First, one of the major decisions involves whether the United States will participate in Israel's ongoing military strikes on Iran. Israel's goal is to destroy Iran's nuclear facilities in order to prevent it from developing nuclear weapons. Although the initial military action was small in scope, it seems inevitable as the two countries' missile attacks escalate. Just last Thursday, Iran launched an attack on an Israeli hospital, prompting Israel to warn that it would step up its retaliation. If the United States decides to intervene in this conflict, it may further complicate the situation in the Middle East and bring more uncertainty to the US geopolitical and economic prospects.

Second, Iran is not a strong opponent of Israel at present, so the United States' intervention may be militarily decisive. However, the bigger question is what will happen after the conflict? Will the Iranian regime collapse as a result? If the regime changes, what will the new regime look like? These are all serious questions that the United States must face when considering whether to intervene in the Middle East conflict. The lessons of Afghanistan and Iraq are still vivid, making people wonder whether military action alone can solve the problem.

In addition, the current policy of the Trump administration seems to be to weaken support for Israel by dropping "bunker-buster bombs" on Iran's underground nuclear facilities. However, there is still great uncertainty as to whether it can achieve "victory" and prevent Iran from rebuilding its nuclear capabilities. Some comments pointed out that a simple military strike may not be enough to overthrow the Iranian regime. Regime change is the long-term goal of the United States, but this will require more means and may not only rely on air strikes.

At the same time, this major decision of the Trump administration comes at a time when the US economy is facing challenges. The Federal Reserve's recently released economic forecasts show that expectations for US economic growth have been lowered, while inflation expectations have been raised. Jay Bryson, chief economist at Wells Fargo, pointed out: "According to the latest forecast summary, the Federal Open Market Committee expects that the degree of stagflation may be more severe than in March." At present, the tariff risks facing the United States still exist. If the risk of military action by the Trump administration against Iran is added, this will make the economic situation more complicated and may lead to more severe economic consequences.

It is worth noting that the more serious macro risk is the further rise in oil prices. If Iran feels a more direct threat, it is likely to take further retaliatory actions, especially in the Strait of Hormuz, a major global oil transportation route. The closure or blockade of the Strait of Hormuz will cause a major impact on global oil supply, and oil prices are bound to rise further. At present, the benchmark oil price in the United States has exceeded $74.87 per barrel, reaching its highest level since January this year. If oil prices rise further, this will not only push up the overall inflation rate, but may also increase the risk of stagflation and have a profound impact on US monetary policy.

In summary, the major decisions facing the Trump administration will have a profound impact on the situation in the Middle East and the global economy. If the United States intervenes in the conflict between Israel and Iran, it may trigger broader military and economic risks. The United States needs to carefully weigh military actions and economic impacts to avoid repeating the mistakes of Afghanistan and Iraq. The current economic situation is already tense, and the risks of stagflation and rising oil prices are increasing. Policy decisions require more strategic considerations.