The Week: Iran, SpaceX, and a Nervous Bond Market
Episode
18 min
Read time
2 min
Topics
Investing, Fundraising & VC, Sales & Revenue
AI-Generated Summary
Key Takeaways
- ✓Bond Market Alarm: Thirty-year Treasury yields reached 5.2% — levels unseen since 2007 — while odds of a Fed rate hike before year-end jumped from under 10% to over 40%. Rising yields increase mortgage, auto loan, and credit card costs simultaneously, signaling broad economic tightening ahead.
- ✓AI Debt Risk: Private credit loans funding AI companies carry floating interest rates, meaning rising yields directly inflate their debt service costs. If CapEx continues outpacing revenue — which most analyses suggest is nearly inevitable — overleveraged AI firms face a compounding cost-revenue squeeze with limited exit options.
- ✓SpaceX Valuation Gap: SpaceX targets a $2 trillion IPO valuation at 106 times sales on revenues below Macy's, while Nvidia trades at under 22 times sales despite growing revenues 85% year-over-year. Scott Galloway predicts SpaceX prices closer to $600 billion within six to twelve months.
- ✓Geopolitical Leverage Deficit: Trump entered Iran negotiations without congressional support, allied coordination, or Hormuz defense mechanisms in place, leaving the US with minimal bargaining power. Meanwhile, the Russia-China strategic alignment — described as the most consequential geopolitical shift of the past decade — continues deepening through energy and military cooperation.
What It Covers
Scott Galloway and Ed Elson analyze three converging crises in late May 2025: the Iran war's economic fallout, the bond market hitting 5.2% thirty-year yields, and SpaceX's contested $2 trillion IPO valuation versus $19 billion in revenue.
Key Questions Answered
- •Bond Market Alarm: Thirty-year Treasury yields reached 5.2% — levels unseen since 2007 — while odds of a Fed rate hike before year-end jumped from under 10% to over 40%. Rising yields increase mortgage, auto loan, and credit card costs simultaneously, signaling broad economic tightening ahead.
- •AI Debt Risk: Private credit loans funding AI companies carry floating interest rates, meaning rising yields directly inflate their debt service costs. If CapEx continues outpacing revenue — which most analyses suggest is nearly inevitable — overleveraged AI firms face a compounding cost-revenue squeeze with limited exit options.
- •SpaceX Valuation Gap: SpaceX targets a $2 trillion IPO valuation at 106 times sales on revenues below Macy's, while Nvidia trades at under 22 times sales despite growing revenues 85% year-over-year. Scott Galloway predicts SpaceX prices closer to $600 billion within six to twelve months.
- •Geopolitical Leverage Deficit: Trump entered Iran negotiations without congressional support, allied coordination, or Hormuz defense mechanisms in place, leaving the US with minimal bargaining power. Meanwhile, the Russia-China strategic alignment — described as the most consequential geopolitical shift of the past decade — continues deepening through energy and military cooperation.
Notable Moment
Gavin Newsom described missing his mother's final days due to political ambition, only reaching her bedside as she died from cancer — then spending thirty minutes afterward saying everything he lacked the courage to say while she was alive.
Episode Transcript
Support for the show comes from Northwest Registered Agent. Your business identity is everything that makes your business legitimate and professional. With Northwest Registered Agent, you don't just form a business. You start a complete foundation built for privacy, credibility, and growth. That includes registered agent service, a business address, operating agreement, domain, website, professional email, phone number, and built in privacy. In other words, your home address, personal email, and phone number stay private. Don't pay hundreds or thousands of dollars for what you can get from Northwest for free. Visit northwestregisteredagent.com/profgfree and start using free resources to build something amazing. Get more with Northwest registered agent at northwestregisteredagent.com/profgfree. Mazda? Once you discover the Mazda c x 90 Mazda? It doesn't take long to get it. With three row seating and safety features like radar cruise control and rear cross traffic alert to carry you and your peace of mind, it will have you saying Mazda. The Mazda CX 90. It's made to move you. Every Mazda SUV offers you an elevated driving experience and refined performance. Discover it at Cutter Mazda of Waipahu. Expedia and visit Scotland. Invite you to come experience the beauty that awaits in Scotland. The sweep of wild coastlines, quiet lochs, and untamed landscapes. Fresh cuisine that feels rooted in the land. Come experience the kind of stillness that stays with you long after you leave. Plan your Scottish escape today at expedia.com/visitscotland. Welcome to the week from PropG Media, where we break down what mattered and what it all means. I'm George Hahn, and it's Friday, May 29. This week, we take a look at why the bond market is panicking and why that panic has been a long time coming. War is pushing up oil prices, oil is feeding inflation fears, and inflation fears are pushing borrowing costs higher. Let's get into it. Let's start where the news started, Iran. Day 88 of the war. On Tuesday's raging moderates, Scott had a fitting analogy for where things stand. Right after when I, I was at Morgan Stanley and I was gonna do a third year, I called the MD at Morgan Stanley who ran the LA office and said, I'm quitting. And I got a backpack, and I, went to Europe. And I was traveling around Europe and I met up. I tracked down this woman who I was just enormously in love with. And we spent about three weeks traveling around Europe, and we were in Vienna and we thought, let's go to Hungary. There is a point here, and I'll get to it in about two hours. I got all the time in the world for a backpacking love story. This is so much better than nuclear dust. This will date me, but I went to the American Express office and cashed traveler's checks. Doing that with my parents. Yeah. And I had one of those fanny belts because we're also worried about having money stolen from the police evil …
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