Suddenly, and with little warning, geopolitical risk is back. With all the thundering force of an underground nuclear explosion, our heads are turned to the globe’s unstable flashpoints once again… Suddenly, and with little warning, geopolitical risk is back.

Not that it ever really left, of course. Preoccupied with a sea of financial troubles, the world had simply put it out of sight and out of mind for a while.

Now, with all the thundering force of an underground nuclear explosion, our heads are turned to the globe’s unstable flashpoints once again…

North Korea: “Look at Me”

In North Korea, the Kim Jong Il Regime has just conducted a fresh nuclear test (and fired three short-range missiles). “World leaders reacted with outrage,” according to CNN, in response to the unlawful test. The U.N. Security Council held a special emergency session to “condemn”

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After the driest January on record, Israel is faced with a huge problem in the form of a multi-year drought.  While fighting wars on multiple fronts and political haranguing, it appears Israel lacks a concrete plan regarding how to address a decreasing water supply in a climate that has not been friendly the past few years.

In fact, at a meeting today, Dr. Yosef Dreizen is expected to tell the “National Investigation Committee Regarding

the Water Crisis in Israel” that there is no plan for water beyond 2010 in Israel.

According to an article in the Jerusalem Post today, Dr. Dreizen said:

“While long-term planning was considered essential, it was never considered practical.  There was never an understanding that after seven years of plenty comes years of drought.” Moreover, he charged, until the transitional plan,  the water

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It came as no surprise to me that both gold got sold off a bit the moment that the gold market opened in the Far East on Monday morning. But it didn’t amount to much, because shortly after 2 p.m. in Hong Kong…1:00 a.m. Monday morning N.Y. time…gold began a slow rise that continued right through the London open. This lasted until the silver fix in London (noon) before selling off about ten bucks. But as soon as floor trading opened on the Comex in New York, the price rose…then spiked to its high of the day…before it was gently capped and then got slowly sold off until the end of Globex trading at 5:15 p.m. Eastern time.

Silver followed a similar route, but it got sold off shortly before the Comex opened…with the selloff continuing until about 8:30 a.m. in New York. From there it rose in fits and starts

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I’ve been pounding the table about an energy crisis for quite some time. As a loyal reader of my Money and Markets column, you might think I’ve been proven right by gasoline soaring over $4 a gallon in 32 states and oil hitting new record highs.

But most of what I’ve been talking about is simply the long-term supply/demand squeeze that will transform our oil-addicted civilization in the future.

It appears, however, that the future is happening now. My fundamental and technical indicators are ALL sounding alarm bells.

Today, I’m going to give you an uncensored, no-holds-barred look at the consequences of the energy crisis. First, let’s talk about why Peak Oil poses such an extreme economic …