Saturday, June 5, 2010

Fortune Smiles On The Fortunate

Some guys have all the luck.

Tony Hayward cashed in about a third of his holding in the company one month before a well on the Deepwater Horizon rig burst, causing an environmental disaster.

Mr Hayward, whose pay package is £4 million a year, then paid off the mortgage on his family’s mansion in Kent, which is estimated to be valued at more than £1.2 million.

There is no suggestion that he acted improperly or had prior knowledge that the company was to face the biggest setback in its history.

His decision, however, means he avoided losing more than £423,000 when BP’s share price plunged after the oil spill began six weeks ago.

Since he disposed of 223,288 shares on March 17, the company’s share price has fallen by 30 per cent. About £40 billion has been wiped off its total value. The fall has caused pain not just for BP shareholders, but also for millions of company pension funds and small investors who have money held in tracker funds.

I can’t even win a freakin’ twenty dollar bet on a football game, but this guy just happens to unload a third of his BP stock before the price tanks and ruins all the small time investors? He must have been getting some advice from the experts at Goldman Sachs, who managed to make a tidy sum of $250 million selling off BP stock before the explosion.

For once I agree with the standard line that nothing improper occurred. This is just the kind of ‘good luck’ that the rich and powerful enjoy in an entrenched oligopoly. The Tony Haywards and the Lloyd Blankfeins hold all the cards. They can bet on any number of outcomes and still basically come out on top no matter what happens. No doubt that if Exxon or Shell moves in and absorbs BP, Goldman Sachs will make a killing on that too, as will Tony Hayward in all likelihood. The winners in this thoroughly corrupt, thoroughly ossified economic system win, the rest of just have to endure things until our three score years and ten are up and we fly away (unless you’re unlucky enough to be along the Gulf Coast right now inhaling toxic dispersants, in which case you might not make it to seventy).

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