BREAKING: BP Agrees To Deposit of $20 billion in Escrow Account

[berni_mccoy]

http://www.nytimes.com/2010/06/17/us/politics/17obama.html?hp=&adxnnl=1&pagewanted=all&adxnnlx=1276707619-jBnTyVcSmBKc3u95eo8WRA

The White House and BP tentatively agreed on Wednesday that the oil giant would create a $20 billion fund to pay claims for the worst oil spill in American history. The fund will be independently run by Kenneth Feinberg, the mediator who oversaw the 9/11 victims compensation fund, according to two people familiar with the deliberations.

The agreement was not final and was still being negotiated when President Obama and his top advisers met Wednesday morning with BP’s top executives and lawyers. The preliminary terms would give BP several years to deposit the full amount into the fund so it could better manage cash flow, maintain its financial viability and not scare off investors.

Obama delivers on one of his Oval Office Address points from last night.

[Tansy_Gold]

1. The agreement is not final and the deposits would be over several years

so as not to hurt BP the Corporation.





TG

[MineralMan]

4. A bankrupt company can pay nothing.

Now, can it?

[berni_mccoy]

5. Somehow this kind of emotion factually lacking response doesn't surprise me.

Do you want BP to go bankrupt by dumping $20 billion in cash into an account all at once? Employees and supply-chain providers of BP still need to get paid. They only have $7B Cash on hand... if they put it all in today, they'd be bankrupt.

[Tansy_Gold]

7. I stated facts, that was all

You need to be maybe a little less paranoid and defensive?

1. The deposits will be made over several years.

2. The time period is to avoid (financial) harm to BP the Corporation.


Where's the emotional lack of factuality in that? Hmm?



TG

[MineralMan]

9. Actually, you were trying to minimize the progress.

It is FAIL.

[Tansy_Gold]

12. No, I wasn't.

Are you now telling other people what I think? Wow, you're good! :sarcasm:

No, actually what I was doing was posting the facts to counter the impression given by the OP that BP had actually agreed to it -- they haven't quite yet -- and that the $20billion was immediately going into an escrow account, since it's not.

I actually have no power whatsofuckingever to minimize the progress, and while I'm flattered that you would impute that power to me, it's really quite wrong. What I do have the power to do is post facts to DU when they are facts, and post opinion when it is opinion.

Whether you like me and/or my opinions or not is really quite immaterial.

The deal may yet be finalized, but it's not yet, and the $20 billion will -- if and when the deal is finalized -- probably be deposited over several years.

Would you rather people not have the truth? Would you rather have people running around telling each other that BP is putting $20B in cash into an escrow account today to cover potential clean-up costs and lawsuits?

Is this declaration a start? And indication that something is happening? Yes, as a matter of fact, it is. But the action that it's indicating hasn't happened yet. BP could put $2B in the account and then still go bankrupt. A lot of things could happen. The fact remains that as of the writing of this post, the deal isn't final and the deposits will be spread out over several years.

Is there something factually wrong with that?


TG

[Lilyeye]

19. Yup!

[berni_mccoy]

11. "so as not to hurt the BP corporation"... sounds emotional to me

When the fact is, they don't have $20b in cash to deposit, it's not about hurting them. It's about keeping the goose alive to harvest the golden eggs.

[Tansy_Gold]

13. But even the NYT segment quoted said that

part of the reason for the installment plan was so as not to "scare off investors." That's pretty emotional, too, if you ask me (and of course you didn't).

The "investors," of course, aren't investing in BP itself in terms of buying new stock to maintain the viability of the company. The other real purpose of allowing BP to remain solvent (bad pun, I know) is to protect the existing investors and their potential dividends and the value of their investments (unless or until they can safely unload them as Tony Hayward did just days before the rig blew). It is not just about keeping BP viable as a golden-egg laying goose so the escrow fund will build; it is so the institutional investors will be protected and not lose their golden (nest)-eggs either.


TG

[berni_mccoy]

15. That's investor reaction... a far cry from your hyperbolic reaction

It's not about hurting BP, it's about killing the goose. You can choose to liquidize BP to get the cash or you can take every cent of profit from here-on in. That is, $7 billion today, or $20+ billion over the next few years. But I see your completely and hopelessly shortsighted.

[Tansy_Gold]

17. You talk about killing the goose and then you call ME hyperbolic?

Excuse me? All I said was that the installment plan deposits into the planned escrow account were designed not to hurt BP -- meaning, as has been posted elsewhere, not to jeopardize the company's viability.

Have I ever anywhere suggested liquidating (not "liquidizing") BP for the cash? No, I have not.

I *DID* suggest putting all future profits in escrow -- that's PROFITS, not REVENUES for those who are ledgerly challenged -- until the cost of the clean-up and lawsuits is settled.

And I most assuredly am not "completely and hopelessly shortsighted." I wear bifocal contacts.




Tansy Gold

[berni_mccoy]

18. Your response was clear in trying to paint this as something favorable to BP. nuff said.

People twist reality all they want to try to paint pictures of what they want to see. It's called spin. And if you wanted to be clear about your intentions of taking BP profits, you should have said that instead of "so as not to hurt the corporation".

[FSogol]

2. A good start. K & R. n/t

[MineralMan]

3. Obama delivers what he promised.

Good job! No doubt, some will try to minimize this, but it happened. He said he'd require BP to do this, and the next day, BP does it. Good job, Mr. President!

[Jeffersons Ghost]

6. I agree with what you said about Obama but it's still only a drop in the bucket

[MineralMan]

8. And yet, a bucket is filled, one drop at a time.

[Jeffersons Ghost]

14. point taken

[Junkdrawer]

10. Actually, it's a 50 Gazillion dollar escrow account...

(with the money to be deposited over the next 10,000 years)....

Details Matter.

[berni_mccoy]

20. Is Gazillion more than a Brazillion?

[Scurrilous]

16. K & R

:thumbsup: