Iran Hits Tankers In The Strait, Oil Rips To $106, State Farm Gets Hammered By California, And Palantir Prints A Record Quarter

Yesterday I told you the emerging-markets tape was the most important thing on the page. Today the most important thing on the page is geopolitical: U.S. forces sank Iranian attack boats inside the Strait of Hormuz, and Tehran retaliated by hitting tankers. WTI jumped from $101.94 to $106.42 in a session. Brent — the global benchmark — is now at $114.44, up nearly 6% on the day. Energy is back in the driver's seat, and our portfolio is positioned for it. I want to walk through what just happened, what changed in the model book, and a Personal Journal piece that has nothing to do with markets but everything to do with how legacy wealth gets deployed.

1. Iran-U.S. fighting just escalated inside the Strait of Hormuz

Here is what we know. American forces sank Iranian attack boats in a bid to keep Strait of Hormuz passage open. Tehran responded by hitting tankers in the same waters. Roughly 20 million barrels per day of crude oil — about a fifth of the world's supply — transits that strait. Even a temporary disruption, and we are now seeing physical disruption, sends Brent above $115 fast.

President Trump is publicly threading a needle: he wants a negotiated end and does not want to bomb deeper, but Iran's Monday provocations leave him "little choice." Markets are pricing more disruption, not less. Stocks fell across the board, the Dow gave up 557 points, and the 10-year yield punched through 4.44% on a defensive-asset bid plus inflation worry from oil.

What we're doing in the book today: reinforcing the energy and defense overweights we already had on. Specifically:

• Reinforce ExxonMobil (XOM), Chevron (CVX), ConocoPhillips (COP), Occidental (OXY) — all already in the 250k and 500k models. Bump each by 1% if there is room.
• Reinforce Lockheed Martin (LMT), RTX (RTX), General Dynamics (GD), Huntington Ingalls (HII) — the existing defense overweight. The Pentagon doesn't un-spend during an active escalation.
• Add Schlumberger (SLB) at 2% — oilfield services. We've been watching this for two months. With Brent at $114, the upstream re-investment cycle is back on.
• Reinforce GLD (gold ETF) to 5% from 3% in the conservative tier — gold is up nearly 1.8% today, and a Hormuz shock is exactly what gold is for.

2. State Farm is facing the biggest insurance penalty since the LA wildfires

California regulators filed a major enforcement action against State Farm for unlawfully delaying, denying, and underpaying home insurance claims from Los Angeles wildfire survivors. The state sampled 220 claims and found unlawful behavior in roughly half of them. The penalty bid is in the millions and could go higher.

State Farm is mutual, not publicly traded — you cannot buy or short it directly. But the read-through is enormous for the rest of California property insurance. Allstate (ALL), Progressive (PGR), Travelers (TRV), Chubb (CB), and AIG (AIG) all sit in the secondary market for California homeowners. The State Farm penalty signals two things: regulators are tightening enforcement, and existing policyholders are about to demand better treatment from the next carrier they call.

What we're doing: watching ALL and TRV for entry. Both have been disciplined about California exposure. Reinforcing CB (Chubb) to 2% in the dividend model — CB is the cleanest play here, with the highest-quality book. We have a full breakdown on our new specialty page: State Farm's Wildfire Reckoning — And What It Means For Your Homeowners Premium.

If you are a California homeowner reading this and you have an open wildfire claim with State Farm: don't wait. Document everything. Get a public adjuster involved. We have a one-page intake we can send you.

3. Palantir, Cerebras, and the AI-defense thesis

Palantir (PLTR) reported a record-revenue and record-profit quarter, driven by U.S. military demand and corporate software sales. Stock is up 3% after-hours. This validates exactly what we wrote about Friday in the Pentagon's eight-vendor AI announcement: defense AI is now a permanent budget line, not a research project.

Separately, Cerebras Systems priced its IPO at the high end of the $115–$125 range, raising $3.5B. This is a wafer-scale AI chip company and the third-largest U.S. tech IPO of 2026. We are watching, not buying, the IPO — the lockup expires in November, and we want to see two quarters of post-IPO numbers before we touch it. The company will trade as "CRBS."

Reinforce PLTR to 3% in the 100k/250k models. Watch CRBS.

4. Factory orders +1.5% — the economy is not rolling over

March factory orders printed +1.5% versus the +0.5% expectation. Even excluding transportation, orders were up +1.6%. This is not a recessionary print. It is the third consecutive monthly upside surprise on capex-related data. The AI buildout is real, and it is now showing up in real industrial activity.

This is part of why we have Vertiv (VRT) and Eaton (ETN) overweight in the data-center power thesis — both reinforced last Friday. Holding both at 4% in the 250k.

5. The Bezos fashion piece is a wealth-leveraging case study

The Wall Street Journal's Personal Journal section ran a feature on Jeff Bezos's fashion transformation. Read at face value, it's a celebrity story: nerd CEO meets style-savvy partner, becomes Met Gala fixture. Read closely, it's a textbook case of how ultra-high-net-worth families convert capital into cultural access.

The Bezoses give roughly $500K a year to the Council of Fashion Designers / Vogue Fashion Fund. Amazon took a $475M stake in Saks Global. They co-chair the Met Gala. They sponsor the CFDA Awards. The dollar amounts are tiny relative to the family balance sheet — but the access, the influence, and the seat at the cultural table are enormous.

Why does this matter for the families I work with? Because the same playbook runs at every wealth level. When you give to your alma mater, your church, your child's school, the local hospital — you are deploying capital for influence, network, and legacy. The structure is the same; only the scale is different. We added a full breakdown to the new Estate Planning & Wealth Management Hub, including a section on how to think about charitable structure (DAF vs. private foundation vs. direct giving) for clients who want their giving to be more than a tax line.

Other things on the page

Tijuana sewage is contaminating Coronado. Sounds small. It is not. Coastal property values in the South Bay are getting hammered. Specialty coverage: The Sewage Spill That's Re-pricing Coronado.

Indian-mango black market. Lighter, but a real read on luxury food access — and worth a story for clients who are India-connected.

Morgan Stanley's Budapest junior-banker workaround is under regulatory review. Not investable, but a useful canary on the hollowing-out of entry-level banking.

White House weighing AI-cybersecurity executive order after the Anthropic Mythos episode. Specialty: The AI Oversight Order — What It Means For Your Tech Holdings.

Berkshire named Charlie Shamieh Gen Re chair as the new insurance chief succeeding Ajit Jain. Insurance succession matters. We're watching but not changing positioning.