Monday, August 11, 2008

Ben Stein: Why Oil Will Keep Falling

Ben Stein thinks the price of Oil, which has fallen by about 20% in the past month from its high will continue to fall. While I don't get into these debates about short term pricing of securities or commodities (or markets for that matter) I do believe that oil prices in the 140 and above range are not sustainable. I've been pointing out in many blog posts that the price of oil was probably a bubble, but that like most bubbles it can't really be known until it pops and you will not know in advance when it will pop.

Oil may very well rise to 150 or high in the coming months or years, but as I've said before, it is in nobody's interest (including the oil producers) for this to happen. We need oil and there is plenty available and a lot more to be discovered, but as free people we will also find other ways to power our future (which will always include oil).

My advice is to continue to keep your wits and not to panic when oil does surge again.

Scott Dauenhauer, CFP, MSFP, AIF