Posted on 06/09/2010 1:55:53 PM PDT by danielmryan
BP Plc's bond prices dropped on Wednesday, pushing yields higher, which analysts attributed to reports of the rising possibility that BP will have to declare bankruptcy as financial pressure from the oil spill in the Gulf of Mexico keeps building.
(Excerpt) Read more at marketwatch.com ...
BP's stock got slaughtered today: down 15.8%. Carnage here.
somebody needs to start looking into who benefits in this administration if BP tanks... seriously.
If they declare bankruptcy, I wonder if they will have the ability to pay claims.
I posted earlier that Obama and the dems are destroying BP BEFORE it can pay out its liability for this spill. While they drive the stock down with threats and demands, BP will be forced to look for an out. That out will not include being around to incur all these costs.
Our government had it in our best interests to keep BP as healthy as possible because there ain’t anybody else to be on the hook for these costs. But all that mattered to Obama was talk of “kicking ass” and criminal prosecutions.
Smart people don’t tell their banker that they are planning to blow up the bank.
I previously thought BK talk was silly too.
Now I’m not so certain. I’d still put it into the ‘remote’ category, but the events of the last week have made BK “no longer impossible.”
8% on three year paper means that the bond market sees a lot of risk in there as well. I see BP two year paper now priced in the 93 range, yielding 7.1%, when two year paper from Citi (who everyone knows is a basket case being propped up by government actions) has two year paper at 3.7%. The further out in maturity you go, the lower that BP’s paper is selling. Going out 10 years, I see BP paper trading at 87.
The bond market speaks a lot louder than the stock market, IMO.
My money is on bankruptcy of rat control. The costs will be staggering. I believe the rats will move if bankruptcy seems eminent. The only road block to rat control is the British government.
One should remember that the class A debtor status of corporate bond holders is no longer a given, in spite of the laws. One has only to remember the crime committed by this administration against the corporate bond holders of GM and Chrysler.
True enough, but very shortly, I’m a buyer.
As a very wise man I used to know once said, trade on panic.
It would make my wacko dim bulb marxist neighbor happy (if that is even possible). He just took down a sign for whatever communist he was voting for and just put up a handmade sign with poor grammar declaring BP is an environmental terrorist organizaion type of claptrap. I ought to pop a picture of it. I would love to see him go live in the woods as a primitive and see how many hours that would last.
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