It is Deja Vu All Over Again in the Energy Markets

There's been quite a bit of news on whether the government will tap the Strategic Petroleum Reserve (SPR) to combat rising gasoline prices.

I get the feeling I've been here before.

In fact, I wrote about this very topic just three weeks ago. And sure enough, we had conflicting reports on the subject yesterday.

But despite what my wife Marina may think, I don't cause events in the oil markets merely by writing or talking about them.

She remains convinced that when I go on television and discuss higher oil and gas prices, my words provide energy firms the green light to raise them.

The reality is that I just know how politicians think (and panic) when it comes to the energy markets. So please, refrain from shooting the messenger.

Yesterday we also witnessed mixed messages from both politicians and the market.

Crude oil prices initially dove more than $3 per barrel in both London and New York when the story broke that there was a joint U.S.-U.K. agreement to release volume from each country's strategic reserves.

Later in the afternoon, prices shot back up quickly in New York (by that time the market had closed in London) following a White House denial that any such deal was in the works.

Still nobody inside the Beltway is claiming the idea is now off the table.

Was yesterday a trial balloon? Some junior staff member with an itchy dialing finger?

A hasty press release?

All are certainly possibilities.

But the confusion created in the aftermath of the "leak" hides one very simple, inconvenient truth.

There are few, if any, genuine options to offset rising gasoline prices.

Everything we need to do will take a few years to work out.

And it should. But you and I need to continue this conversation.

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Bank Stress Tests and the All-Clear-to-Rally Signal

Earlier this week I repeated that I've been cautiously bullish (too cautious, I also said) since October.

I also told you I was optimistic that all the major indexes would break through the important psychological, headline, and large-round-number resistance levels they started flirting with two weeks ago.

Boy, was that an understatement.

On Tuesday, markets blew the lid off of any impediments in their way.

In fact, the price action was so fast and furious you'd have thought the Federal Reserve said something about keeping interest rates low, or maybe that some good news about bank stress tests had leaked out.

And to think, only one week earlier, markets had a steep fall from grace on account of Fed Chairman Ben Bernanke not saying anything about another round of quantitative easing.

What a difference a week makes.

In case you missed the psychology of the market, it went like this…

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What Someone Needs to Ask the Presidential Candidates

Kent is in Europe this week, advising on oil supply concerns in cash-strapped nations.

And it's getting serious over there.

As he noted on Fox Business last week, Greece imports nearly 30% of its oil from Iran, and the country needs fuel in order to keep its economy moving in these uncertain times.

I don't think our leaders or media say this enough, but energy is the catalyst of economic growth and human progression. And a lack of reliable fuel sources will only make this teetering European economy even more susceptible to its ongoing debt woes.

The last 100 years of prosperity in the U.S. was not driven by abstract ideals like the "American spirit."

Cheap, efficient energy sources fueled our growing global economy. They were an underlying driver of a population boom and expansion across the continent. Without them, we wouldn't have our highways, sprawling suburbs, or supporting infrastructure that has made this country so unique.

But the days of cheap oil are fading fast. Production costs are rising as we shift toward unconventional oil fields and tight gas formations for our sources.

So, once again, we're looking to alternative forms of energy.

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You Asked, He Answered: Shah Gilani on China, Ben Bernanke, the Fed and Much More...

Thanks for flooding my email inbox. I asked for it… Let's start off with some comments and questions about Ben Bernanke and the Fed…. Q: I see no distinguishable difference in the relationship that government has with the Fed/Banking Systemand some individual getting involved with a ruthless loan shark. ~ James M. A: The Fed […]

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Geithner and Summers Protect Free Market Mantle Against Regulatory Reform

Two key members of President Barack Obama’s economic team were part of a group of financial heavyweights that in the late 1990s helped to kill regulatory reform that might have limited the impact of the 2008 financial meltdown.  Now, as the administration’s primary proponents of free markets, they are again subverting efforts to tightly regulate […]

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Three Ways to Avoid Another Credit-Default-Swap Crisis

Former U.S. Federal Reserve Chairman Paul Volcker and Bank of England (BOE) Governor Mervyn King think that banks that are considered “too big to fail” should be broken up. The House Financial Services Committee is drafting a bill that will make banks pay for other banks’ bankruptcies. Others have suggested reviving the Glass-Steagall Act – […]

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A Money Morning Interview: The Future of Energy

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Five Ways to Outsmart 31,179 Other Investors

Back in mid-June, more than 75% of the investors responding to a CNNMoney poll said they were planning to buy stocks – many of them aggressively. Of the 41,572 people polled, it now looks like those 31,179 bullish investors kept their word. The Standard & Poor's 500 Index has zoomed 15% since those investors were […]

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The Two Reasons it's Time to Short U.S. Stocks

The stock market is up 51% from its March 9 lows. The leading economic indicators have turned sharply positive, showing gains for each of the last four months. Manufacturing is on the rebound. And banks are promising to pay record bonuses, as their earnings have rebounded. With this recent rush of upbeat economic news, it's […]

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Gold Aims to Retest Record Highs After Breaking Through the $1,000 Mark

Is gold ready to break out? Gold broke through the psychologically important $1,000-an-ounce level for the first time in 18 months yesterday (Tuesday) as the U.S. dollar slumped against key foreign currencies, exacerbating investor fears that loose fiscal and monetary policies will spur inflation as the U.S. economy recovers. The thinly traded September futures contract […]

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