Posted on 03/27/2016 2:59:59 PM PDT by doldrumsforgop
He'd borrowed from banks and investors and retirement funds, all in a frenzied mission to drill for oil and gas, and by the time Terry Swift realized he'd gone too far, this was his debt: $1.349 billion. His company, founded by his father almost 40 years earlier, had plunged into bankruptcy and laid off 25 percent of its staff. Its shares had been pulled from the New York Stock Exchange. And now Swift was in a company Chevrolet Tahoe, driving back to the flat and dusty place where his bets had gone bust.
Swift was coming to this energy-rich strip of South Texas trying to grapple with how much blame he shouldered for the failure of his company. A low-key and historically cautious oil chief executive who eschews private jets and orders low-fat salads for lunch, he had made what he thought was the best financial move of the past decade - a gamble on rising oil prices - and yet he was ensnared in an industry-wide craze of dangerous debt.
"Maybe we were wrong to believe there wouldn't be a bust this bad," Swift, 60, said as the Tahoe rumbled south of San Antonio. "It didn't even feel risky."
Swift's miscalculation has made his company, Swift Energy, a casualty of the greatest wave of financial defaults since the subprime mortgage crisis ravaged the U.S. economy. For him, it's a painful low point in his family's 111-year journey in American oil, one that started when his great-grandfather set up a series of storage tanks in the plains outside Tulsa. And it's a jarring reversal from just a few years ago, when Swift
(Excerpt) Read more at tylerpaper.com ...
This is a risky business, like many have found out who are going out of business or lost jobs.
Most of the people running “big oil” are incompetents. They have done this time after time. When the money is flowing in, they spend lavishly, borrow, and go on a hiring spree. Then when things go bad, they lay off thousands and cut back on all the projects they started.
Of course, when things are going well, it’s due to their brilliance, but when there is a downturn it’s an “unforseen” drop in the price of oil. Either way, their salaries and bonuses keep going up. No wonder the populists are winning.
And when they go out of business (due in part to trading practices of big oil and their Saudi partners), they get bought up by big oil (Rockefeller and others thru Blackrock and Carlyle Group) for pennies on the dollar.
Endless debt bubbles and crashes. All brought to you by our fiat, unbacked currency and the soviet-style central planners at the Federals Reserve.
Yes, there is definite sadness from many such stories.
A bad sign when it comes to Texas oilmen.
The worst part of this is that it is going all according to plan. ...
The OPEC-0bama plan to destroy all of the upstart American oil producers to once again make us dependent on Imported oil and that of the few really ‘Big Oil’ Domestic companies who can afford to buy influence in Washington DC and have the credit and cash reserves to weather the artificially low market prices for a year or two.
GOLD STANDARD IS THE ONLY WAY TO SAVE AMERICA
What a... coincidence...
I’m glad I wasn’t the only one thinking that.
That, to me, is the biggest factor. Seeing a Saudi prince foaming at the mouth over the prospect of the Keystone pipeline and shale-oil, i.e., domestic production, told me all I need to know. 0bama and company did their worst to crush the industry. However, taking on that much debt has seen sorry ends in any crash, no matter what the commodity or industry.
Yep..
Foolish to take on that much debt... I’m not even in the industry or anything related to it, but I predicted that when these ‘upstart’ American producers and processors started actually threaten the established ones, the Global ‘Powers That Be’ would unite to destroy them. If I could understand that, They should have been able to figure it out and figure out how to work around it.
And every time I mentioned it here at FR, everyone said: “No worries. They just turn off the taps now, and turn them back on when the price goes up. It will only take a few days for every one to get back in business when the price goes back up.”
Progressives, bankers, and "TPTB" have done a great job of stigmatizing a precious metals standard. In fact, a gold standard would destroy the progressive, social-engineering, massive nanny-state. It would take currency and debt creation out of the hands of politicians, government and central planners at the Fed. It would force government to compete with every citizen, and the free market, for money.
No sympathy from a majority of Freepers. Read past posts on how it’s “our” oil and gas and and “we”’should not be selling it overseas.
Now instead of having sold it at a nice profit it will go at a loss. Will all those on this forum now pony up a littl extra?
Should be an object lesson for all of those that will put the Federal Government in charge of deciding how we can spend our money or in this case sell our property. The government has no business telling free people how to spend money or sell assets even if it means allowing us to import goods or sell goods overseas.
“Most of the people running “big oil” are incompetents. “
Sounds like an opinion, unless you can cite some source.
If you are talking about American oil companies, there are really painfully few ‘Big Oil’ - only Exxon, Chevron and ConocoPhillips.
These do not make a dent in the oil industry in this country which is dominated by independents like substance of the article.
I am tired of all of this “Big Oil” that keeps circulating. It does not exist anymore.
It is a liberal talking point to find a bogeyman.
I am seeing a similar scenario play out in a number of industries. Boom times go bust, and every one acts shocked that you can’t borrow your way to prosperity
“The government has no business telling free people how to spend money or sell assets even if it means allowing us to import goods or sell goods overseas.”
The exception I take is in case of War. We cannot allow our enemies to be enriched if we are trying to survive against an enemy.
Since I believe acts of terrorism (which really surfaced against the West began with the ascent of OPEC in the ‘70s - coincidence?) is war against us, I think the federal govt should have a lot to say about trading freely with those who want to kill us or those who harbor them.
Unfortunately, our govt is not focused on controlling those, only us.
“and every one acts shocked that you can’t borrow your way to prosperity”
That, my friend is the example set by the Democratic party, abetted by the GOPe. Here we are $18 trillion later.
At the behest of the family, the Rockefeller Fund is liquidating all its "fossil-fuel holdings".
Can't be seen to profit from Global Warming...
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