Prof G Markets: "The Iran War Risk Markets Are Ignoring"
Date: March 9, 2026
Podcast Hosts: Scott Galloway ("Prof G") and Ed Elson
Podcast Network: Vox Media Podcast Network
Episode Overview
This episode explores two major subjects:
- Market response to the recent US/Israeli military strikes on Iran and why markets seem to be largely ignoring the war’s risks.
- Anthropic's stand against the Pentagon regarding AI tech contracts, the company’s subsequent market momentum, and contrasting leadership styles in tech, especially compared to OpenAI's Sam Altman.
Through their signature mix of incisive financial analysis, banter, and sharp commentary, Scott and Ed discuss what the market’s muted reaction reveals (and doesn’t reveal) about geopolitical risks, investor psychology, and broader global power dynamics.
Key Discussion Points & Insights
1. Markets and the Iran War: Why So Calm?
Initial Market Impact
- Military escalation: US and Israel launched major strikes on Iran, taking out Ayatollah Mane A, top officials, and damaging key infrastructure. (07:00)
- Market reactions:
- S&P 500 fell only slightly; 10-year Treasury yields rose modestly.
- Crude oil surged to an 18-month high.
- Ed: "If you are looking to the markets to tell you something about the future, it would be that the future of this conflict will probably be somewhat contained... the stock market's reaction basically flat since this happened." (07:53)
- Travel/luxury stocks: Airlines, cruise lines, LVMH notably down. Korean Kospi index saw a sharp one-day drop due to energy price fears.
Market Psychology & Historic Patterns
- Scott: "The markets are immoral... there's nothing like getting truth from someone than asking them where they're actually investing." (10:10)
- Markets see it as ring-fenced: Traditionally, stocks suffer in the short term during wars, but often recover robustly within a year ("three quarters of conflicts since WWII, a year after, stocks ended up in the green." – Ed at 12:13).
- Ed's skepticism: "Part of me wants to think this is a big deal... but the markets are not reflecting that... I am struck by investors' general consensus that none of these [worst-case scenarios] is going to happen." (15:00)
What the Market Might Be Missing
- Downside risks not priced in:
- Further destabilization/regime change in Iran ("not an unlikely scenario" – Ed at 13:00).
- Potential for broader regional chaos, energy disruptions, cyberattacks, refugee crisis feeding European populism.
- Ed: "My mind is whirring with all of the what-ifs... and I feel like no one is honestly contending with those potentially bad outcomes." (24:30)
- Scott: "The biggest danger to the markets is not the actual action in Iran. It's another data point that we are now that rogue nation." (19:45)
US Legitimacy, Leadership & Dollar Weakness
- Scott: America is perceived as the "rogue nation" now, undermining trust in dollar-based systems. "India and Canada just struck a trade deal... settling trade in non-dollar currencies." (18:30)
- Dangerous precedent: No Congressional approval, lack of allied support, and mixed public support for the war signal global instability and potential long-term underperformance for US markets.
Notable Quotes:
- Scott (10:10): "The markets are immoral. There's nothing like getting truth from someone than asking them where they're actually investing."
- Ed (12:13): "JP Morgan found S&P returns are actually the same on average during peacetime and following conflict. Recent history would tell us that this is strangely not that impactful on markets."
- Scott (19:45): "The biggest danger to the markets is not the actual action in Iran. It's another data point that we are now that rogue nation."
- Ed (21:42): "What I don't understand is why there seems to be this blind faith and trust in [Trump's] ability to handle this competently."
Big Picture Risks vs. Market Optimism
- Scott points out that markets can be wrong, citing regime changes historically leading to more, not less, instability.
- Both emphasize the unpredictability ("the enemy gets a voice," 29:26) and the possibility of broader fallout, but note the market's apparent faith in containment.
2. Anthropic vs. OpenAI: Tech Ethics Goes Mainstream
Context: Pentagon & AI Contracts
- Anthropic (maker of Claude AI): Rejected a $200 million deal with the Pentagon, refusing to allow its tech to be used for surveillance of US citizens or in autonomous weapons (46:36).
- OpenAI/Sam Altman: Quickly picked up the contract; public backlash followed.
Market Response and the Business of Ethics
- Anthropic's gain:
- Claude hit #1 in the App Store.
- Company’s enterprise market share rose to 32%, overtaking OpenAI.
- ARR jumped from $14B to $19B in two weeks (49:00).
- OpenAI’s loss:
- Uninstall rates in the US surged nearly 300% after the Pentagon deal.
- Scott: "He's the first CEO who said no, and he's absolutely right... There’s an enormous commercial opportunity for the first person who gets off their knees and says, 'F*** you, I’m an American.'" (49:31)
- Ed: "We literally have the data in front of us that getting off your knees, as you say, standing up to the President, literally translated into a $5 billion revenue opportunity." (52:34)
Contrast in Leadership Styles
- Anthropic’s Dario Amodei is lauded for ethics-first leadership, apparently rewarding the company both commercially and in public trust.
- OpenAI’s Sam Altman suffers a reputational hit, especially following a widely criticized comment on AI vs. humans.
Memorable Quote:
- Scott (49:31): "He’s the hero we were waiting for... someone took advantage of the biggest commercial opportunity of the last six months—to stand up and say, you know what, being an American means we get to operate by the rule of law but we also get to make these decisions."
3. Sam Altman’s "Nihilism" and Public Perception
The Controversial Altman Quote
- Clip (54:30): Altman argues that it’s fair to compare AI training energy expenditure to the human process: "It also takes a lot of energy to train a human. It takes like 20 years of life and all of the food you eat during that time before you get smart..."
- Scott’s reaction: "We had a bit of a looking glass into Sam Altman’s soul and he's a fucking nihilist... That, he even thinks that way, feels...frightening." (55:16)
- Ed: "He does not have an understanding of purpose... what existence and humanity is actually all about. I think that quote said it all." (59:33)
- Trend: Americans who "dislike" Altman doubled over the last year (52:34).
Notable Quote:
- Scott (55:16): "The whole point of humanity or being a parent is that you make these investments because that's where you give in to purpose."
4. Predictions, Bets, and Closing Thoughts
Oil Market Outlook
- Scott: "Oil in a year from now will be less expensive than it was at the beginning of this conflict or war." (29:26, 42:18)
- Ed: Agrees, but with "very low" conviction; sees lots of uncertainty (42:27).
- Both agree: markets betting on containment, but with major X-factor risks.
Broader Market Implications
- Scott: Predicts weakening US dollar and underperformance in US markets due to lost global trust (19:45).
- More CEOs likely to emulate Anthropic’s resistance to government pressure, demonstrating commercial upside to ethical stands (60:56).
Memorable Quotes & Moments
- Scott (10:10): "The markets are immoral. There's nothing like getting truth from someone than asking them where they're actually investing."
- Ed (12:13): "Recent history would tell us that this is strangely not that impactful on markets."
- Scott (19:45): "The biggest danger to the markets is not the actual action in Iran. It's another data point that we are now that rogue nation."
- Ed (24:30): "My mind is whirring with all of the what-ifs... and I feel like no one is honestly contending with those potentially bad outcomes."
- Scott (49:31): "He’s the hero we were waiting for... someone took advantage of the biggest commercial opportunity of the last six months—to stand up and say, you know what, being an American means we get to operate by the rule of law but we also get to make these decisions."
- Sam Altman (54:30): "It also takes a lot of energy to train a human... it took the very widespread evolution of a hundred billion people that have ever lived…"
- Scott (55:16): "We had a bit of a looking glass into Sam Altman’s soul and he's a fucking nihilist."
- Scott (60:56): "Dario Amodei has taken his company from 14 billion a year in ARR to 19 billion a year in ARR with one simple strategy: no. And that's going to give CEOs the confidence to say no."
Important Timestamps
- 06:05 – Start of Iran war/market analysis segment
- 12:13 – Historical context: markets during past wars
- 19:45 – US as "rogue nation" and dollar trust issues
- 24:30 – Ed's "what-ifs" on market risk
- 29:26 – Discussion of war unpredictability; investment opportunities post-conflict
- 46:36 – Anthropic vs. Pentagon; OpenAI contract aftermath
- 49:31 – Galloway on the business case for speaking out
- 54:30 – Altman's controversial quote; analysis
- 60:56 – Closing predictions; moral courage in business
Summary for New Listeners
This episode is a rich, candid look at how major global events—wars, regime change, and corporate ethics—intersect with markets and investment psychology. Scott and Ed deftly challenge the narrative that markets can foresee everything, raising doubts about investor complacency on geopolitical instability.
The episode transitions to the state of AI, showing how standing for values (in Anthropic’s case, refusing a Pentagon contract) can actually become a competitive advantage in today's market. They end with sharp criticism of OpenAI’s Sam Altman, questioning the future ethos of tech leadership.
If you're interested in the intersection of global risk, market reactions, and technology’s societal impact—all delivered with sharp wit—this episode is essential listening.