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178 comments on DrumBeat: December 7, 2008

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Undertow on December 7, 2008 - 10:07am Permalink | Subthread | Comments top

Another telling quote from the Oilexco North Sea story linked above

North Sea oil firm up for sale

If you want to look at a case study for the impact of the credit crunch on independent oil companies, this is it,” said a banker. “This is a mighty fall from grace. It calls into question the fundamental model of [exploration and production] companies and shows the fragility of these businesses.”

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Catskill on December 7, 2008 - 12:10pm Permalink | Subthread | Parent | Comments top

I call into question the idea that the problem is with the fundamental model of exploration and production companies.

At least those businesses are actually doing something productive by finding and extracting petroleum.

The problem lies in the financial shenanigans cooked up by the Wall St. wizards who won't be happy until they've brought down every productive business on the planet as collateral damage.

If you manufacture, grow, build, or extract something as your "fundamental model" you stand a very good chance of being destroyed by those in the "industry" of producing debt and all the accessory financial nonsense we've witnessed over the last decade.

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DownSouth on December 7, 2008 - 12:37pm Permalink | Subthread | Parent | Comments top

Nice catch, Catskill.

I'm about half way through Kevin Phillips' Wealth and Democracy where he develops this theme at some length:

Historically, an Icraus tendency, an overambitious national wingspread for finance, has been a problem, not an asset, for leading world powers. During the finance-dominated eras of Dutch and British global economic primacy, the "real economy" retreated and wealth concentration grew.

Kevin Phillips, Wealth and Democracy

Once these banking and finance types get their clutches into a country, it's pretty much the kiss of death.

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178 comments on DrumBeat: December 7, 2008

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