At 7:04 this morning, President Trump said the U.S. and Iran had been having “productive discussions” to end the war, and within minutes the S&P 500 surged.
Roughly $2 trillion in market value appeared almost instantly on the belief that tensions might be easing.
Then, just as quickly, it all fell apart when Iran announced that there had been no talks. In fact, they said they hadn’t had any contact with Washington at all.
(And now I’m thinking of the old adage about the first liar not standing a chance.)
But I digress…
With Iran’s denial, the market reversed, and about $1 trillion in value disappeared as fast as it had been added.
In less than an hour, roughly $3 trillion swung back and forth.
It’s important to understand what actually happened in that hour. No factories appeared. No new goods were produced. No additional value came into existence and then vanished.
What actually changed was something far more fragile: people’s expectations. Prices adjusted in real time to what people believed the future might look like—and then adjusted again when that belief turned out to be wrong.
But even though nothing “real” actually happened, it had a real impact on the real lives of a lot of people.
Most Americans have lived their entire lives at a comfortable distance from war. We don’t hear sirens in the night; we don’t send our kids to school wondering if they’ll come home again; we don’t rebuild homes from rubble. For generations, war has been something that happens somewhere else—”over there”.
It’s something we watch on TV, analyze from our couches, or even lend our support to—all without ever experiencing its immediate physical consequences.
Over time, that distance has created a kind of illusion. It makes war feel abstract, manageable even, like something that can be debated and even endorsed without it ever really touching our lives in any meaningful way.
But what this morning exposed is how incomplete that picture—and how fragile the illusion of safety—really is.
No, bombs aren’t falling on American cities. But the consequences of war don’t stay neatly contained to the battlefield. They ripple outward through energy markets, supply chains, taxes, debt, and inflation. They move directly through the financial system that millions of Americans depend on for their future.
Our retirement accounts, our investments, our savings—they can’t actually be separated from global conflict. They’re tied to a complex web of expectations about stability, trade, production, and risk, and when those expectations shift, even briefly, the value of those assets moves with them.
That means you can wake up, go about your morning, and in the span of an hour watch years of disciplined saving rise or fall—not because anything real has actually changed, but because the story people are telling themselves about the future has changed.
If you zoom out a little farther, you find that the problem runs much deeper than just short-term market volatility.
Swings like these are a surface-level symptom of a much larger reality: war doesn’t just create uncertainty, it systematically redirects resources. It pulls capital, labor, and production away from serving consumers and pushes them instead toward serving political ends. It’s financed through debt, sustained through taxation, and usually accompanied by the kind of monetary expansion that quietly erodes purchasing power over time.
Those are costs most people don’t see directly, but they feel them all the same. They manifest in higher prices, in slower growth, and in opportunities that never materialize because resources were used elsewhere.
For most of human history, the cost of war was immediate and visible. Today, for many Americans, it’s easily ignored. But that doesn’t mean it’s not still very much there. Now it shows up as instability, as distorted incentives, as numbers on a screen that suddenly don’t look the way they did yesterday. It may not be as visceral, but it is no less real.
This is why it matters how we think about war in the first place. It isn’t a strategy game, and it isn’t something that can be supported casually under the assumption that the consequences will always remain far away. In a connected world, they can’t.
And that’s exactly why it’s so important that our kids understand not just the history of wars, but the economics behind them. They need to understand how incentives shape decisions, how information can be incomplete or purposely manipulated, and how the actions of a few can ripple outward and affect millions who have no dog in a fight.
We’ve spent more than a decade creating books and curriculum that teach kids the truth about the way the world around them works. From award-winning economics curriculum to books that teach about how governments use fear to manipulate their populations, and guides to the world’s most dangerous modern villains and worst ideas, we offer a plethora of resources to help parents teach vital lessons that their kids won’t learn in school.
Because if they don’t learn these things at home from parents who care about actually preparing them for the world they’re inheriting, they’ll grow up believing the same thing too many people believe now: that war is something you can support from a distance without ever paying the price for.
This morning is a good reminder of why that isn’t true.
We may not hear the bombs, but that doesn’t mean we’re not feeling the impact.
— Connor
