FNC
Gary Kaltbaum
This week Gary Kaltbaum, president of money management firm Kaltbaum & Associates, answers YOUR money questions. Ask FNC's business team a question by e-mailing yourquestions@foxnews.com and check back each week. Plus, tune in to "The Cost of Freedom," Saturday starting at 10am ET.

Question: Since U.S. oil inventories are at an eight-year high, isn't most of the recent run-up in oil prices due to investment and speculation? — D.S. (Springfield, MO)

Gary Kaltbaum: There are so many reasons for the spike in prices. For starters, gasoline supplies have been very tight because refiners are shifting additives to ethanol. This is under orders from the government. Ethanol prices have jumped 35% since the beginning of the year. Secondly, there are major geopolitical worries. There are worries about a nuclear standoff in Iran. There are worries about political tensions in the Middle East and now Venezuela is added into the mix. All of these areas are major oil producers. Lastly, there is no let-up in demand despite the higher prices. The world consumes over 80 million barrels a day, while analysts say there is only 1.5 million barrels a day of spare production.

Question: Is this a good or a bad time to buy stock in in Exxon (XOM), with oil prices skyrocketing? — Deb (Toledo, OH)

Gary Kaltbaum: As far as Exxon Mobil is concerned, just watch oil prices. If they start to come down, expect Exxon Mobil to come down. Since we have already seen a big bump in recent weeks, maybe you should look to wait for a pullback first. I do believe oil remains in a bull market.

Question: My family has been shopping at the Gap (GPS) for twenty years. Is it still a solid retail investment? — Placido

Gary Kaltbaum: Gap Stores stock is down from $53 in 2000 and now sits at $18. This speaks for itself. Also, the stock shows no gain over the past 10 years. There is a simple reason for this. Gap is a "no growth" company. Earnings and revenue have been stagnant for years. There is no reason to invest in this company right now when there are so many other retailers that are doing better.

Question: How do I determine a "stop loss" position on a stock? Is there a process on how to determine a "stop loss point?" — Phil

Gary Kaltbaum: There is no secret formula to a "stop loss." It depends on an individual's own wallet as well as their own risk tolerance. I am a believer in never letting losses go into the double digits, but this is also based on a strict "buy" discipline as well. Just think about these numbers: a 25% drop needs a 33% gain just to get back to even, but a 50% drop neeeds a 100% gain to get back to even. As the losses pick up, it is tougher to recover.

Question: I have never bought gold bullion before but am considering taking your advice in adding this to my portfolio. I Googled "gold bullion" and came up with Bullion Direct. Are sites like this my best bet or do you have another suggestion? Also the bars over the coins look like the way to go. Am I correct? — Carl (Roanoke, VA)

Gary Kaltbaum: There are dozens of places to buy gold bullion, either on the web or elsewhere. Like anything else you do, just make sure they are who they say they are. Unfortunately, there are still many who are not on the up and up. I personally would choose the bars over the coins, but that is an individual choice.

Gary Kaltbaum is president of money management firm Kaltbaum & Associates. He can be heard nightly on his nationally syndicated radio show "Investors Edge" on over 50 radio stations. He is a regular on FNC's Business Block. Visit Kaltbaum's Corner on TradingMarkets.com for more.