Billmon: The Oil Card

Oil hit $78 a barrel today, and Bloomberg News is quoting analysts saying it could soon go to $100. As of this writing, the Dow is down 130 points. The Japanese, with their usual exquisite sense of timing, just raised interest rates for the first time in the professional lives of many Wall Street traders. Retail sales are down, consumer confidence is down. In other words, the financial markets are having another very bad, horrible, no good day -- as is the Cheney administration.

This has political as well as economic significance, I think. Also diplomatic. For the first time since I don't know when -- the early '70s, I guess -- something is standing in the way of the customary U.S. kneejerk support for Israel. The higher gas prices go, and the lower the 401(k) portfolios of the masses drop, the dicier it gets for the GOP in its desperate struggle to stave off an eruption of democracy in our Chamber of People's Deputies (i.e. to preserve its death grip on congressional power.)