Oil

Light crude oil closed today at $60.07. Market analysts and all of the other talking heads on T.V. have been talking about a price ceiling at $60 and how it's this great psychological barrier. Maybe it is, but if you ask me, all this news in neither here nor there. Oil going up or down by a buck means about as much to me as Bernarke telling us that housing is stabilizing and inflation is under control.

Let's look at the big picture. China's demand for oil is growing exponentially at over 10% a year. We have reached maximum world output at around 84 million barrels of oil per day. The actual amount of oil in the earth is past peak, and we are sitting on top of a geopolitical cauldron that could boil over at any second. We are one invasion, bombing, terrorist attack (global or local) from a doubling in the price of oil.

To me, these small changes in the price of oil are pennies on the dollar. This is a large global problem and a great weakness for the U.S.