Nothing makes conservatives queasier than regulation, especially of financial markets. But oil’s meteoric rise from $50 in January 2007 to almost $139 on Friday calls for drastic measures that might solve this crisis without a measure as drastic as the gas tax Charles Krauthammer proposed on Friday.
In the past, energy price appreciations of last week’s magnitude have typically been caused by supply disruptions — like the 1973 OPEC embargo, or the 4 million barrels per day in lost production that followed the Islamic Revolution in Iran in 1979, which restricted international oil supplies for several years and caused a spike in prices.
“Writing a book is an adventure. To begin with it is a toy and an amusement. Then it becomes a mistress, then it becomes a master, then it becomes a tyrant. The last phase is that just as you are about to be reconciled to your servitude, you kill the monster and fling him to the public.” -Winston Churchill-
Monday, June 09, 2008
More On the Commodity Bubble
I am dubious as to his solutions, but another writer backs up my thesis that we are in the middle of another asset bubble.