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My mother is holding quite alot of BP stock so I felt I should research to see if she should dump it.
I looked at Exxon's stock prices before and after the Valdez spill of 1989 and the spill didn't effect the progress upward much at all.
Some say BP is handling the PR end of the debacle better then Exxon did, but BP's screw-up looks to me more dire. So maybe it's a wash.
Bottom line, I think I'll tell mom to hold cuz big oil companies are just soooooo profitable that even causing a horrible event like this, which affects virtually everyone, it is but a mere hiccup.
Anyone with investment expertise care to comment?
It has been three weeks since your post. However, I thought I would throw in my two cents worth.
1) no one has a crystal ball. Unless you are at the rig itself and were involved at a very intimate level in the explosion or the spill or any cover-up, you are speculating on the future, just like 99.99999% of all mortals.
2) If found guilty of everything and based on a spill 20% larger than the Exxon Valdez, I have heard estimates of the bill reaching $50 billion. If so and all else equal, the costs of the spill are priced in.
3) At 8% dividends and a modest one year rise to 47.5, you would generate a nice 20% return on investment from here.
4) If it falls from here and ends up a year later at $39, you would have zero nominal return. Not the end of the world.
I have a small long position at the average of just about where we now sit. If it sells off down below 37, I will add. and even more if we get to $30. From there, it will be held for a number of years.
Reporting from Kenner, La., and Washington — — Hours before the fatal accident that sank the Deepwater Horizon oil rig in the Gulf of Mexico, workers for the rig's owner quarreled with BP officials who wanted to finish the drilling job despite problems, a mechanic told a Coast Guard committee in Louisiana on Wednesday.
Douglas Brown, the rig's chief mechanic, testified that three officials for rig owner Transocean Ltd. balked at the desire of a BP "company man" to remove drilling mud from the pipe connecting the rig with the well.
"There was a slight argument [that] took place.… The [BP] company man was saying, 'This is how it's going to be,' " said Brown, who could not identify the BP official.
After the midmorning meeting, Brown said, Transocean worker Jimmy Harrell grumbled, "Well, I guess that's what we have those 'pinchers' for" — apparently referring to the shear rams on the blowout preventer on the seafloor.
The shear rams are emergency devices used when all other means of controlling gushing oil have failed. Brown's account suggests that Harrell thought BP was taking a grave risk by replacing the drilling mud with lighter seawater.
Remember, I called it at $30... I already knew top kill would fail before it even started and I knew the news was lying when they were early reporting "success"... hehehe... possibly $20 with anti-BP legislation but we will see...
I would think that it is a good time to buy and not a good time to sell. On the othe hand, congress changed a law stating that there is no end to the debt that BP had to pay to fix this mess (which was unconstitutional, since they changed the law after-the-fact). So, if this mess doesn't get fixed it could cripple BP, not to mention the possible criminal charges that many are proposing. So, maybe it would be a good time to get out. Who knows for sure?
I'm no invester guro by any stretch of the imagination, but IMHO this spill is many times larger than anyone is letting on about. I never figured BP would be in serious financial trouble over the spill, but now I'd say that's a distinct possibility. We get a lot of coverage here localy that others don't, plus we work in the oil business. BP is really really doing a bad job, but maybe that's because they know how bad this is and are sitting back to hang on when the spill eventualy kills over half the Gulf of Mexico and goes up the east coast. My only question is where did all the seagulls go?
Your in the oil business and you think BP's doing a bad job? I'm in the oil business also and i would assume that they are doing everything humanly possible to undo this dissaster. Because thats how big oil industry opperates. Everybody is so pissed off against BP but they didnt cause the blowout. They ARE responsible but they were not operating the rig or any aspect of it.
I would think that it is a good time to buy and not a good time to sell. On the othe hand, congress changed a law stating that there is no end to the debt that BP had to pay to fix this mess (which was unconstitutional, since they changed the law after-the-fact). So, if this mess doesn't get fixed it could cripple BP, not to mention the possible criminal charges that many are proposing. So, maybe it would be a good time to get out. Who knows for sure?
They are definitely going down if the existing trend of failures and controversies continue. And the politicians will try to punish BP with punitive actions to cover their own buns in the ensuing fallout.
Selling won't be that much of a bad idea now, considering a potential loss of at least 10 dollars per share in the coming days
I just siphoned more money into scottrade last week, I will happily watch BP fail
yeah if anything we should all be pissed at all the enviornmentalists who got in shore drilling kabashed so everyone is forced to drill in waters that are soooo deep they really are experimental at this point.
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