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POPS Analyst Warns of $200/Barrel Oil* *One barrel of crude oil is 42 gallons (or $4.76 per gallon) In the Cato-at-Liberty blog post "Is There an Oil Price Bubble?" Cato senior fellow Jerry Taylor writes: "The most recent Fed actions to combat the deteriorating state of the macroeconomy added even more fuel to the oil price fire. With market actors increasingly convinced that the Fed is willing to entertain inflation in the course of injecting liquidity into the market, investors are looking for investments to hedge against inflation. And what do you know? Returns on commodities have historically been better during inflationary periods than during non-inflationary periods. Ben Bernanke thus sent another strong infusion of cash into commodity futures -- again, largely into oil and gas futures.
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