One of the most interesting things that I have seen over the past year has been the run up in oil prices. In September last year, oil was at just under $70/barrel. Until prices suddenly took a dive the past two weeks, oil was within sneezing distance of $150/barrel. There were people who projected $200/barrel or greater as something that was inevitable. While I don't want to declare victory over these chumps yet, I'm getting closer to saying I told you so. While $200/barrel isn't unreasonable, it is unlikely. Of course, if it happens in the next hundred years, I fully expect people to claim that they said it first. The problem is that they were treating oil demand as so inelastic it was practically a giffen good. The first problem with this was data showing that people were driving less and/or buying more economical cars. Second was the drive to increase our reliance on alternate energy sources (nuclear, wind, solar, hydro, etc). Third was the political push to actually open some new areas to oil exploration here at home. With these forces gathering (and picking up steam with every dollar increase at the pump), you had to see that there was a bubble there. The first sign of the bubble was the panic buying. You heard that Angola had a little instability or that the front fell off of a tanker? It's time to bid it up some more. The second was the classic volcano pattern. Things were stable...stable...stable, then it took off like a rocket. When the real estate bubble popped, you'd think that would have warned people of the same thing happening in commodities. Instead, they piled in more.