Gas Cheap Now, But Not for Long

Filling up at the pump is less painful than in the recent past.

I saw gasoline for $1.69 per gallon for Regular (cash) yesterday on Route 1 in New Jersey. It has been a long time since we have seen gasoline that low and the relief to the consumer's wallet is a welcome one indeed. It is tantamount to a tax cut on the citizens or even a pay raise. The bottom line is that it gives people more money to spend on other important things and can even increase household savings rates and encourage on-the-road travel vacationing. The low price of oil and the resultant low price on gasoline and diesel fuel are boons to the economy in many ways.

So why are prices as low as they are? It's because of the extra oil on the market from U.S. oil production which has seen a boom in recent years, due in part to hydraulic fracturing and increased oil drilling on private lands.

But my point with this post is not to talk about why there is so much oil, or the benefits of fracking. There are many articles and blog posts addressing these issues. The point of this particular post is to throw a wet blanket on this low-price enthusiasm.

The price won't be low for long. And the past would be the indicator of future performance.

In 2009, the price of gasoline dropped below $2.00 a gallon for a brief time and then continuously rose back up to $3.50 to $4.00 a gallon for Regular in New Jersey. The chart below shows the price per barrel which the price per gallon of gasoline follows in its movements.

From Infomine.com

The message? Get it while it's hot, because very soon it's going to shoot back up to $3.50 per gallon and probably higher.

What are the causes of oil price movement? Supply, demand, political unrest and government regulation. Right now supply is greater than demand, so the price is lower. But there are so many political hotspots in the world today that any one of these tipping points that tips could cause oil futures to shoot back up to $120 per barrel.

As examples, Russia's designs on Ukraine and its trouble-making around the world have the potential for causing oil prices to rise, and this is a country that wants oil prices to rise back up because so much of their economy and budgetary income is based on the sale of oil and natural gas. So for Russia, instability on the world stage which causes higher fuel prices is exactly what they want and need.

Daesh or ISIS, is militant Islam rampaging through the Middle East and threatening terror everywhere else. They are currently in control of half of Syria and much of Iraq. It won't take much for that particular march of evil to cause an oil price spike. If they were to succeed in taking over Syria or Iraq, or cause mayhem in Saudi Arabia, Jordan or Israel, these are just some scenarios that would be catalysts for crisis leading to an oil price rise.

Al Qaeda, the original Islamic terrorist group is still a very real threat and actively trying to bring terror killings to the next horrific level. There is no restraint as to the kind of murder and destruction that they would like to perform and if they had a weapon of mass destruction they would have no hesitation in using it, as we have seen on 9/11 and in other events. Hamas and Hezbollah are the more localized but just as dangerous militant Islamists of the Middle East. Any of these groups could and would bring economic chaos that could result in sky-high oil prices.

Iran is a country that wants to see Israel and America (the great Satan) destroyed. It is progressing in its efforts to become a nuclear power with Russia's and North Korea's help. It could very soon succeed in its efforts to make a nuclear weapon. If that happens Israel may bomb Iran's nuclear facilities causing a regional war. This would spike oil prices.

The Taliban is still killing people in Afghanistan and Pakistan and seems intent on continuing to cause death and destabilization, also through the spread of terror.

The Communist-led, police-state of China always takes the side of the bad actors on the world stage as shown by its support of Iran, Venezuela, Cuba, North Korea, and Russia. And it is intent on destabilizing Taiwan, threatening the U.S. and Japan, and throwing its weight around the region and the world. And China never seems to lend its growing military might to world security threats that other civilized countries fight against. Their belligerent actions could be the cause of any number of scenarios that could cause an oil price spike.

Even if it isn't a national political action that causes the problem, it could be a crucial break in the supply chain, perhaps a few oil refineries going down, a natural disaster or a massive oil spill like the one in the Gulf of Mexico a few years ago. The anti-hydraulic fracturing movement could also put a political chokehold on oil derived from this process especially if countries regulate against the process as many individual states in the U.S. have done.

So, sorry to be a stick-in-the-mud, but enjoy the lower cost of gas for your car and fill up your fuel oil tank now because inevitably the low price we see now will soon disappear to be replaced again by the signs we are so used to.

Missile Defense Is Insurance Against the Unthinkable

It would take 33 minutes at most for an intercontinental ballistic missile to reach the U.S. from the rogue or enemy state that it is fired from. Think North Korea, Iran, Hamas, Al Qaeda. This well produced and researched one hour video discusses why missile defense is important and the functionality of it in the United States at present. You will be surprised at how far the U.S. has come with missile defense since President Reagan started pushing for it in 1983.

Unfortunately, the current president of the United States has a different agenda than President Reagan did. In 2009, President Obama cancelled the deal the U.S. had with Poland and the Czech Republic to build an interceptor site that would have provided protection of the U.S. and its allies from ballistic missiles. The Polish president called it a betrayal. And now that he's been reelected the U.S. president "can be more flexible" with Mr. Putin of Russia concerning the neutering of allied missile defense. Mr. Obama wants to cut missile defense spending in 2013 in addition to all his other debilitating cuts to military spending.


In recent days, North Korea has been moving intercontinental ballistic rocket segments to its missile launch site in apparent preparation for launch. They have the bomb and are working on the means of delivering it anywhere in the world. Iran has been busy making nuclear fuel, and coordinating with North Korea on its bomb and delivery systems. And recently, Hamas has been raining missiles upon Israel. All of this activity shows the importance of staying vigilant when it comes to missile defense development and implementation and not letting political ideology abrogate the defense of the American people. This defense is Job One of our common government as mandated 226 years ago by the U.S Constitution.

http://33-minutes.com/33-minutes/

President Obama's State of the Union Address - The Egg McMuffin of Speeches

The political stump is where you can hear the real, unadulterated words of President Obama. You hear sound bites of them every day in the news. In the speeches that he gives when traveling the country while fundraising or pushing a particular issue, the president uses Republican bashing, wealth bashing, petulant, blame-everyone-but-himself, fudge-the-numbers, fudge-the-reality language and comes across as little more than a left-wing ideologue.

And then there's last night's State of the Union address. In the televised address to both houses of Congress, President Obama came across as someone who might be willing to cross the aisle to work with the other political party. He and his speechwriters tried to sound more moderate, more reasonable, and more pliable. He spoke well of America and its flag, he spoke well of the military and their successes against bin Laden and in Afghanistan and Iraq. He spoke of liberty and tyranny (!) and of intolerance for Iran's nuclear ambitions. He also spoke almost conservatively when speaking of unfair trade and piracy from countries like China.


Appreciative and appreciated words.

But the president and his speechwriters are liberals and a liberal message can't help but pervade even this attempt at an aisle-crossing speech. He went on to say in the State of the Union address that our relationship with Israel is stronger. It is clearly not. His actions have distanced us from Israel and increased the threat against them from multiple enemies in the region. Egypt, Libya, the Palestinians, Hamas, Syria, Turkey, and Iran are all greater threats to Israel than ever. He said our ties with Europe and Asia are stronger. They are not. He said our ties with South and Central America are stronger. This is true, if the government is left-leaning, or socialist. It is not true of more democratic, or conservative states like Honduras or Colombia.

He said in his speech that our military will be stronger in the years to come, but 500 billion dollars in cuts, a smaller fighting force, and the smallest navy since 1947 counter this statement. All of this in the face of increasing threats around the world. Everything Barack Obama has done since entering office has been aimed at reducing the military's strength (not too mention increasing the size of the budget, and the debt).

In his State of the Union speech, the president (a Democrat) said that he believes what Republican Abraham Lincoln believed: That government should do for the people only what they cannot do better by themselves, and no more. However, his actions for the last three years show just the opposite. He wants government doing any and every thing that people could do better for themselves.

This president once again called for immigration reform so that illegal immigrants can enjoy the benefits of American citizens and not have the worry of being deported hanging over their heads. :`-( I ask again, what kind of country do we live in where our leader wants to sanction the illegal actions of millions of people? Against the will of the majority.

The 44th president also called (yet again) for a tax increase on millionaires. Nothing new there. He and his speech writers know what works with his base, I guess.

He continued on to say that he wants to develop more energy in the U.S. from all sources of energy and even suggested opening up more public lands to drilling. This would be great if it were true, but he has turned down the Keystone XL Pipeline from Canada which would have greatly helped reduce oil imports from the Middle East and has continuously been a thorn in the sides of oil companies that want to drill in the Gulf of Mexico or off the coasts. And despite his failed backing of solar energy company, Solyndra, he wants to double down on that type of investment.

My suggestion to those who listened to President Obama's 2012 State of the Union address (hopefully his last)--Forget everything you've heard, because it's the stump speeches where the truth (and more lies) comes out to play. As Rush Limbaugh likes to say, this is nothing more than a State of the Union Show.

Get a free download of State of the Union addresses. State of the Union Address (1790-2001)


Egg McMuffin is a registered trademark of McDonalds Corporation.

No Official Bin Laden Death Photos - For Now

I agree wholeheartedly with the Obama administration's decision not to release pictures of Osama bin Laden's dead body. The fact that he is shark food at the bottom of the ocean and no longer a source of terrorist activity, murder, mayhem, and jihadist inspiration should be enough satisfaction for those of us in the U.S. and everywhere else in the civilized world who believe that the U.S. government wouldn't lie about THIS. In fact, they could not lie about it because the truth would leak out eventually. And for those that seriously want proof, I am sure they can approach the White House for the DNA evidence and other evidence, which some press outlets like 60 Minutes, The New York Times, or The National Enquirer will likely do. Besides, photographic evidence is almost worthless these days with the easy digital photo manipulation of photographs that goes on.

Already a horrible, fake, dead Osama is floating around on Facebook and probably scaring some kids whose newsfeed it shows up in because some friend or family member commented on it. The fake is really gruesome as I am sure the original is.

What would be the good reason to release the pictures? To assure our enemies the Islamic Jihadist terrorists, the Taliban, Hamas, Hezbolla, and Ahmadinejad that we are not lying, Osama really is dead? Will that suddenly convert them to our side? No. We don't even need to think for a second about releasing it for their sakes. Should we release it for the sakes of the people of Afghanistan who may be on the fence about whether to support the U.S./Afghan government or the Taliban? Maybe, if it will convince the leaders and the citizens of Afghanistan that the main source of funds to the Taliban in the past is out of the picture and that they can side with the forces of good, then it may be a useful tool in ending the hostilities in that country.

As far as skeptical governments, the U.S. can work directly with any of these and show them directly all evidence it has, including the photographic evidence. But this is the problem.

Unfortunately, the way the world works today, information can't be kept secret for long if there is a desire for it. Think wikileaks. At some point the real photo will leak out, by someone within the government, or someone who the government shows the evidence to, then the U.S. government will feign anger at the leak, but then admit that the photo or photos are authentic.

It is just a matter of time before evidence or photos of Osama bin Laden's death leak from the sieve that is the U.S. government, so unfortunately, the arguments for or against releasing them are really a moot point.

Middle East on the Verge of Disaster in the Wake of Flotillas

Four Kassam rockets have landed in Israel setting off warning sirens days after Israel's Defense Forces boarded a ship which was attempting to break Israel's blockade intended to stop weapons from getting to the Gaza strip and the militant Hamas and Islamic Jihad. No one was injured in the recent rocket attacks, according to the Jerusalem Post.

But more rockets! This is exactly why Israel instituted a blockade, and why they should continue to enforce it. Because they don't want  Jew-hating Jihadists shooting rockets into their cities.

Prime Minister Netenyahu said that "the boat was no Love Boat", and even if it were a Love Boat it should and would have been stopped. Except that no one would have been hurt or killed on either side in that case.

Still the flotillas keep coming, testing Israel's resolve and today Iran is even offering to provide military escort to the flotillas, a move that could start a war between Iran and Israel.

Turkey's Prime Minister is doing a lot of huffing and puffing about Israel, and calling for UN investigations, when it is Turkey that should be investigated for its role in assisting the breaking of a legal naval blockade of another state.

President Obama and secretary of state Clinton should show some support (i.e., political backbone) of Israel instead of always throwing the besieged state under the bus. Middle East peace is on the precipice right now and one poorly placed foot is going to result in an ugly regional war.