03/02/2012 07:46 am ET Updated Mar 02, 2012

Oil Price Panic: Seven And A Half Things To Know

Thing One: Let's All Panic About Oil: The oil market is as jittery as Rick Santorum in a sex toy shop. Case in point: Yesterday a sketchy "news" report flashed around the Interwebs that an oil pipeline in Saudi Arabia's restive Eastern Province had exploded. The oil market did not wait to find out if this was true. It promptly jumped on a chair and started shrieking and did not stop until long after Saudi Arabia denied the report. Crude oil prices surged to more than $110 a barrel in New York, and Brent crude oil prices in London jumped to a gasp-inducing $128 a barrel, the highest since their record of $147.50 back in 2008, writes the Financial Times.

By the logic of the drill-baby-drill crowd, higher oil prices should not be happening, or should not matter. The U.S. is fracking and drilling its way to a glorious energy independence, where we can put flammable drinking water in our gas tanks and drink cheap oil instead. U.S. oil imports fell to a 12-year low last year, the FT writes, thanks to all this fracking and drilling. And yet! Gasoline prices are on their way to $4, maybe $5 a gallon. Why? Because we cannot frack and drill enough to avoid seismic upheavals in the global oil market, like anxiety in the Middle East and rising demand in emerging markets. Even bringing that ballyhooed Keystone pipeline down from Canada won't help -- in fact, it may hurt for a while, writes my former softball teammate Jonathan Alter at Bloomberg View.

Meanwhile, there's also reason to cheer soaring oil prices: Maybe that will help us use less of the stuff. As it is, our carbon emissions have oceans acidifying at the fastest pace in 300 million years, Bloomberg writes, meaning my children might be some of the last humans to see coral reefs with their own eyes. If they're lucky, and the whole food chain doesn't collapse. As Charlton Heston once put it, God damn you all to hell.

Thing Two: Let's Also Panic About China: OMG, everybody, China is diversifying its foreign-currency reserves. That means it might be buying fewer U.S. Treasury bonds, which means that U.S. interest rates might some day skyrocket, which means that we might some day all have to live out of our rusting cars for a few decades. That's the fear beneath a front-page Wall Street Journal story today, but even the story doesn't seem to really believe the hype. China is still buying dollars -- it's just buying other currencies, too, a rational investment decision. And we don't even truly know what the heck China is buying because it's also buying dollars via proxies in London, Hong Kong and the Caribbean. Meanwhile, Japan is buying so much Treasury debt that it more than makes up for any slowdown in China's purchases. The U.S. government's borrowing costs are the lowest in decades. The idea of a Chinese Treasury-buying strike is an ancient fear in markets, and in the media. The WSJ story points out we've been afraid of China not buying our debt for three years now. It always gets people excited. And yet it continues to not really happen.

Thing Three: Take This Dow And Shove It: Speaking of buying strikes, individual investors continue to resolutely not care about the Dow Jones Industrial Average being back at 13,000 or the fact that the Nasdaq Composite index is about to hit 3,000 for the first time since the tech bubble popped more than a decade ago. Joe Light writes in the Wall Street Journal: "According to mutual-fund flow tracker EPFR Global, individual investors have pulled $8.3 billion out of U.S. stock funds since the beginning of the year and sunk almost $10.6 billion into bond funds." This despite near-daily admonitions from Warren Buffett and an endless army of stock-market cheerleaders on the TV insisting they're throwing their money away on bonds and missing out on the opportunity of a lifetime. People may be missing out, but can you blame them after everything that's happened in the past 12 years?

Thing Four: No Data For You! AT&T and other wireless operators are putting the brakes on unlimited data usage to spare what they say are overtaxed networks, writes Brian Chen of the New York Times. You can still get the data on your miraculous little handheld device, but you're going to have to wait for it a little bit, unless you want to pay more. This has led to grumbling from some heavy data users, in a classic example of what's known as a "first-world problem."

Thing Five: More Waiting In Greece: Euro-zone leaders have decided to delay giving Greece about half its latest wad of cash while it waits for Greece to enact its latest wad of economy-crushing austerity measures, the Financial Times writes. In other signs all is perfectly well in Europe, Barclays copped to borrowing more than 8 billion euros in the ECB's latest free-cash party, and banks parked a record amount of cash overnight at the ECB. Everything's just fine! And European stocks are higher.

Thing Six: The Wide-Ish Net Of Justice: A Justice Department inquiry into the slicing, dicing and bundling of mortgages into securities appears to be wider in scope than another SEC inquiry into the same thing, Reuters reports. The DOJ inquiry covers more years of activity and includes Fannie and Freddie mortgages, which the SEC's inquiry did not. Of course, these are civil, not criminal inquiries. You wouldn't expect anybody to go to jail over this stuff, would you?

Thing Seven: Geithner's Wife Can't Believe You People: Tim Geithner, in an op-ed in the Wall Street Journal, says his wife can't believe it when she hears bankers whining about financial reforms, because she had to field their panicky phone calls in the middle of the night just a few short years ago.

Thing Seven And A Half: Obama Versus BS: President Obama sat down with ESPN/'s Bill Simmons to talk about the important things in life: Basketball, his favorite character on "The Wire," his early role in the Jeremy Lin phenomenon, the stress of throwing out the first pitch at a baseball game, and also basketball.