JBL: Mining the New Black Gold

When you are bad throughout the year, rumor has it that at Christmas you will receive a lump of coal in your stocking. This year, I recommend you be bad because owning coal this Christmas is a good thing. Besides, being bad is more fun anyway.

There has been a terrific bull market in commodities this year, but energy prices have eased considerably since their summer peak. That's due, in part, to things returning to normal after Hurricane Katrina, milder weather, and a seasonally less demanding driving season upon us. Regardless, the pullback in prices has created a good entry point on energy stocks.

Both sides of the aisles in Congress are making sure that lower energy prices are temporary. They can't agree on new refineries, a uniform standard of gasoline, or fuel efficiency standards. This week, Congress browbeat the CEOs of major oil companies in the hopes of distracting our attention from the fact the politicians still have no plan.

Supply and demand for energy has not been addressed, nothing has changed: As a result, energy prices will resume their upward trend.

We are literally in the eye of the storm here; it seems calm, but it's not. We just had a large run-up in energy prices, and now we have seen a pullback. The rest of the storm is coming and the time to buy is during this calm period.

Wind and solar energy plans are dependent upon generous tax breaks to be cost effective. Natural gas has become expensive, even with a recent slide to $11.65 per million British thermal units. Undeniably, the cheapest form of energy is coal and it will increasingly replace natural gas as the preferred source of power for state and local utilities.

The old rub against coal energy was that it was bad for the environment, but technology has also made coal virtually as clean to burn as natural gas. This year, Santa's got a special gift for you: a bag of coal or, if you're really lucky, the following coal stocks.