Criteria for Assessing the Middle East Situation: An Analysis of the Nature of the Attack on Iran’s Nuclear Facilities

At present, there is no reliable evidence to prove that the United States has completely destroyed Iran’s nuclear facilities. The criterion for determining whether the attack was successful is simple: as long as the United States is still willing to negotiate with Iran, it means the nuclear facilities have not been destroyed. Conversely, considering that Israel has already assassinated most of Iran’s nuclear scientists, if the nuclear facilities were destroyed as well, the U.S. would have absolutely no reason to continue negotiations.

Technical considerations also support this conclusion. To destroy an underground nuclear facility 90 meters deep, two bunker-busting bombs would need to strike the exact same spot at the exact same angle to breach the bunker’s walls and detonate the internal targets. Now, the U.S. has unilaterally declared success without even conducting nuclear leakage tests. At its core, this is simply a political stunt by Trump—following the same playbook as the previous campaign against the Houthis, where even a ceasefire counts as a win; after all, it’s a win either way.

What’s even more interesting is that Iran has likely already moved the core equipment of its nuclear facilities. It’s as if the U.S. gave advance notice of the strike’s time and location, allowing Iran to move its assets accordingly, so that in the end, all three parties could declare victory—the whole thing is nothing more than a well-rehearsed performance. Israel vented its frustration, Iran suffered no losses, and Trump secured campaign material—everyone is satisfied. Now it remains to be seen how Iran responds. If it cooperates by delaying its nuclear program, the matter will be put to rest; if it claims its nuclear facilities are intact, Trump will be left with no face to save and will likely launch a larger-scale strike.

Analysis of the Fed’s June Meeting: Signs of Stagflation Emerge, Uncertainties Surround Rate Cut Expectations

This Fed meeting largely met expectations. The dot plot was generally neutral, but Powell’s remarks leaned hawkish, with two rate cuts projected for the year. Upcoming economic data will be crucial; if inflation rebounds, those two cuts could be reduced to one. This is why we must keep a close eye on the situation in the Middle East—if Trump really makes a major move there, oil prices will rise, inflation will surely follow, and rate cuts will be out of the question.

Judging by the official FOMC data, the signs of stagflation are already quite evident:

  • GDP growth forecast was lowered from 1.7% to 1.4%, indicating a slowdown in economic growth
  • The unemployment rate forecast was raised from 4.4% to 4.5%, signaling a cooling job market
  • PCE inflation forecast was raised from 2.7% to 3.0%, indicating that inflationary pressures are still rising

The latest dot plot shows that internal divisions within the Fed have grown significantly. While views were relatively unified last time, they have now become polarized. Under these circumstances, the Fed will not change its policy lightly; it will have to wait at least three months, with the earliest opportunity to see one faction fully concede coming in September. If inflation continues to rise over the next three months, the doves will have to accept fewer rate cuts; if inflation continues to fall, the hawks will have to abandon their hardline stance.