Burning rubber.

Now that the secret has been exposed, I can comment on the extraordinary performance the tire industry is experiencing. For fear of jinxing the companies, much like a pitcher on the verge of throwing a no-hitter, I refused to talk about how well they were doing for fear of causing some sort of tire industry recession.

The Dow Jones Newswire let the cat out of the bag with an August 6 article, "Tire stocks scream to the top of Wall Street heap." The article is actually a caution to those "investors savvy, or lucky enough to have feasted on the tire sector the past year." It has been a long time since tire company investors were called savvy. And would someone tell me when was the last time investors feasted on tire company stocks?

It gets better. The Dow Jones wrote: "To say the group (tire stocks) has burned rubber would be more than just a bad pun--it would be a major understatement. In fact, no other industry in the Dow Jones universe of sector indexes has been able to keep pace with tire stocks since last summer, not even close."

The company's tire index is up 140% since last year. In comparison, consumer electronics, the runner-up sector, was up 81%. Pushing the tire sector are performances of Cooper Tire and Goodyear Tire, whose stocks were near all-time lows. Last year at this time, Cooper's stock was trading at $8, it is now $23, and Good-year's stock price increased $11 to $26 a share and has reached $36.90 a share during the past 12 months.

But all is not well in tiredom. Another recall is underway, and even though this one involves Chinese tires being brought into the country through an importer, it tarnishes the whole industry. It is too early to tell if this recall has affected the purchase of tire stocks.

The real problem with the most recent recall is that it exposes the weaknesses of the the U.S. regulation system. This recall was not mandated, but is a voluntary recall on the part of the importer. The U.S. National Highway Transportation Safety Administration acts more or less like a watchdog. The recall was initiated by the importer, mainly in response to litigation, not from action by the regulatory agencies.

With the heavy flux of imported tires entering the country, it's time the government gets on top of the safety issue. If not, the American trial lawyer will gladly introduce our tort system to those sending unsafe tires here. But for many, that will be too late.