Long After the BP Oil Spill, Businesses and Markets Will Suffer
By VISHESH KUMAR
The time to buy is when there’s blood in the streets, the old axiom goes. But for shares of BP (BP), the time to buy might be as oil continues to gush into the Gulf of Mexico.
Liabilities for the company continue to mount, along with gargantuan damage to the Gulf Coast. On Sunday, reports that President Obama will push to have the company put aside set aside large amounts of cash, to compensate businesses and persons affected by the oil spill, added to the tensions already brewing about whether the company should suspend paying dividends to shareholders.
BP stock has come under selling pressure throughout most of May and June. But some of those who’ve taken a hard look at the company’s balance sheet — like John Authers, editor of the Lex column at the Financial Times and author of The Fearful Rise of Markets — say investors might be getting carried away with the BP sell-off.
The miserable sentiment surrounding the shares may be masking the enormous financial resources the company has to pay for damages, Authers tells DailyFinance in a video interview (see below).
Wider, More Lasting Damages