So the message here is that Americans have to endure high prices at the pump to allow these folks to pay off their debt. Nonsense, they made business decisions that proved to be inaccurate. No more bailouts for anyone. Oil companies are not “too big to fail.”
Where do you read that? Not in this article.
I read too much debt with too much risk can result in companies with better financial management may buy the assets at reduced cost during the bankruptcy.
No bailouts. No federal subsidy.
There were plenty who criticized the oil majors for not spending billions jumping in the shale boom as fast as they could. Now some of those are buying in at a fraction of the cost. The message is investors need to be aware of the risks. The message is not that government (taxpayers) should take that risk away.
The companies will go bankrupt. The human beings who know how to drill for oil will still be around.
The story is really about the bankers, not the small time drillers. The drillers won’t be missed, and will back in the game on the next up cycle. And the TBTF banks aren’t at risk. Some of the regionals and smaller banks do have high exposure. But they won’t be helped out unless they are politically connected. Might be a good time to go shopping for banks if someone has a lot of capital to tide them over.