I'll keep this short. As I have been writing for the past year, those American policymakers (and I include here both Bush, Paulsen, Obama, Geitner and Bernanke) who think the solution to foreign oil addiction is financial tom-foolery are locked into a failed strategy and need to read this article by Robert Fisk in the Independent.
Please read my previous instablog post, "The Big Picture", (which SA decided not to publish for whatever reason, but which predicted Tuesday's market action) for more on this issue. Not only are Americans addicted to foreign oil, but we'll soon have a currency with which is so weak we won't even be able to purchase oil (at any price). Meanwhile, we sit on an abundance of natural gas and have readily available proven natural gas vehicle technology. As Boone Pickens said on CNBC yesterday morning, this country must be stupid.
What can Americans who see this coming do? Buy gold and/or pull a Jim Rogers and move your family out of the country.
Making matters worse, at this point I think the U.S. is planning to scale back in Afghanistan and attack Iran. Who knows what yet another oil war will do to the currency and gold markets, but I think I know what will happen to the oil market.
What a mess! American energy, foreign, fiscal, and monetary policies have been, and are still, simply a disaster. But it all starts with energy policy. American refusal to acknowledge its foreign oil addiction (and the resulting economic, environmental, and national security issues) and make the transition to natural gas transportation, has led to wrong-headed foreign, fiscal, and monetary policies which are coming home to roost now that emerging economies are vying for those same strategic oil reserves. The above referenced article isn't surprising. The real question is: what took them so long?
The solution to America's problem: a strategic, long-term, comprehensive energy policy.