Dagen McDowell filled in for Neil Cavuto this week. Dagen was joined by Jim Rogers, president of JimRogers.com; Ben Stein, economist; Mike Norman, founder of Economic Contrarian Update; Dave Nelson, DC Nelson Asset Management, and Charles Payne, CEO of Wall Street Strategies.

Dagen McDowell: Are we being gouged by the Saudis (search) at our gas (search) pumps? A record number of motorists hitting the road this holiday weekend and getting slammed with record high prices at the pump. And if two dollars a gallon for gas isn't already fueling your anger enough, what if we told you these high prices are Saudi Arabia's fault? Mike, should the Saudis be pumping out more oil to help keep our prices down?

Mike Norman: I think it's interesting that right after the Saudi foreign minister met with President Bush to try and release the classified information from the 9-11 report, and the President refused, oil prices started to go up. The Saudis know the only way they can get back at the United States is by hitting the economy and increasing oil prices.

Ben Stein: Oil prices started going up right after my son's birthday, so I don't think we can blame my son for oil prices going up right after his birthday. There's no evidence the Saudis have cut back on their oil production. What we do have evidence of is there's a sudden spike in demand. If you have evidence that there's a conspiracy, I think you ought to share it with Congress.

Jim Rogers: The price of oil has not gone up nearly as much as the price of gasoline. We have not built refineries in this country for 20 years. Listen to Ben, he's right. The refineries are the problem.

Charles Payne: The gasoline pipeline that burst in Arizona was made in 1955. We had a blackout just a couple of weeks ago that pointed to infrastructure problems. We have an infrastructure problem here. As far as Saudi Arabia is concerned, in 1980 when oil prices were over $30 a barrel, their foreign minister warned OPEC saying, “Listen, let's not push this.” Then what happened was, we had a global recession and by 1986, crude oil was under $10.

Dagen McDowell: How long can we sustain these prices?

Charles Payne: It's expected that these numbers will pull back after the weekend. But this has happened before. We've seen refineries come up short before. We really need to look in-house and figure out what we're doing wrong here in the United States.

Jim Rogers: Prices are going to stay high though. Prices will level off like Charles is saying, but the surprise will be that prices will remain high.

Ben Stein: We can live with high gas prices for a long time. It's not an enormous fraction of the GNP and it's being re-circulated. It's time to buy. I like B.P. Amoco (BP). If you think gas prices are too high, buy stock in the companies.

Mike Norman: I like Yukos (YUKOY). Two of the largest oil companies in Russia have merged. If oil prices stay elevated, I think it will do very, very well.

Jim Rogers: I would buy Woodside Petroleum (WOPEY) down in Australia, and I would buy Eni (), which is an Italian company. And I own them both.

Charles Payne: I like Baker Hughes (BHI). They take oil and make it more efficient. As oil companies benefit from these high prices, they'll reinvest that money into better efficiency. Also, every time you get high prices in energy you start to think of an alternative. Arch Coal (ACI) is very close to having their supply meet some of these Clean Act safety standards.

More for Your Money

Dagen McDowell: Corporate executives dumping shares of their own companies in record amounts this summer. So why do some say this is a good thing that will help investors get more for their money? Insider selling way out-pacing buying the past 3 months, something that usually predicts the market will go down. What about this time, Dave?

Dave Nelson: The knee jerk reaction is to say every time there's huge insider selling like there is now, that the market is going to take a big fall. Insiders are human and they see their stock go up a little and they want to sell. So what? It certainly isn't bullish, but I'm not selling out because of this.

Ben Stein: It reminds me of a conversation I had with some Wall Street people just as the tech boom was starting, and I asked, "Can the outsider, private investor from Des Moines beat the professional?" And the professional said, "For a little awhile." So, I think for a little while, the outsiders will make a little money. I would be quite concerned about buying into a gigantic insider-selling situation.

Charles Payne: I think you have to look at it on a stock-by-stock basis. A lot of people who have tried shorting the stocks that have insider selling have been crushed. I got crushed trying to short Expedia (EXPE). Investors have to keep it in context. If a guy sells 50,000 shares and he owns 50 million, it's not a lot of shares.

Jim Rogers: I'd rather be on the side of the insiders than against the insiders. If insiders are selling I want to know why. I'm selling because the market has run up. The market is very expensive. So I would agree with the insiders.

Charles Payne: I think insider buying gives a much better idea of the wealth of a company.

Dave Nelson: But Jim, you think this is just based on fundamentals and that's why they're selling? I don't think so. People sell for a lot of reasons.

Ben Stein: There was a story in the Wall Street Journal about a man who was selling $30 million worth of stocks and he said he was doing that, not because he didn't have faith in the company, but because he needed to pay for his children's college education. I'd like to know where his children are going to school.

Dagen McDowell: Jim, where do you think stocks are going in the coming year?

Jim Rogers: I think they're going down this fall for a while. Then they'll probably have a rally. I'm worried about 2005.

Dave Nelson: I can't tell you what will happen two months from now. But I think a year from now stocks will be higher.

Charles Payne: I think a year from now stocks will be up higher.

Ben Stein: I think the market is too high.

Head to Head

Dagen McDowell: It's the number one question you need to know before investing your hard earned money. Is the market cheap or way over priced? Wall street having its best year since the bubble burst more than three years ago. But as you see, we're still a ways a way from the all time highs set in early 2000. Mike, you say stocks are still a good buy.

Mike Norman: Stocks are not over-valued. Over-valued compared to what? If you look at bonds, you get 1.9 percent on a 2-year note. You get 3.4 percent on a 5-year note. You get 4.4 percent on a 10-year note. It's just not enough. Earnings have been growing and the economy is improving.

Ben Stein: Historically, the Dow trades at around 14 times earnings. It's now at around 22 times earnings. Historically, the S&P trades at around 16 and 18 times earnings. It's now at 32 times earnings. The Nasdaq Q's are over 200 times earnings. This is very, very high multiple land. It's possible we could rally from here, but it would be historically unusual.

Mike Norman: I think the real risk is these linear interpretations and saying "historically." We're in a paradigm now that we haven't seen before in terms of extremely low interest rates. Did you know Ben that the P.E. ratio on a 2-year note is over 50? So comparatively those things are still over-valued when compared with stocks.

Ben Stein: They're paying a very low yield but actually you can get corporate bond funds that are yielding about 5 or 6 percent. If we're going to have any measure whatsoever, it has to be by some historical norm.

Dagen McDowell: So Mike, what would you buy?

Mike Norman: I like General Motors (GM). I think that's a stock with a great dividend yield.

Dagen McDowell: Ben, you are finding some stocks to buy.

Ben Stein: I think the Dow (DIA) is the most conservatively valued of anything. So if I'd be buying I'd be buying the Dow Diamonds. I love anything that pays a good yield. I like the iShares Dow Jones Utilities (IDU).

FOX on the Spot

Dave Nelson: Best bet in Q4: Buy consumable stocks!

Charles Payne: Back to work; More help wanted ads.

Mike Norman: Interest rates fall as federal deficit shrinks.

Jim Rogers: NYSE chairman Dick Grasso will leave.

Ben Stein: Jim is right! Grasso should go!