Here are a few more gauges of the crisis to come: Since 2006, an additional $1 trillion of capital expenditures by just 59 companies has been spent on shale drilling and operations (per OilPro.com). And another $1 trillion of energy-bond debt has gone on the books, according to the Bank for International Settlements. Energy-company bonds will sell off and create a pall of risk avoidance across all industries.
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Great post! I so agree with this!!! Whoever you are, kuddos to you! Very intelligent and true!
A staggering $2 trillion of debt was meant to generate a 3-to-1 increase in value. That value today is definitively less than half of what was spent. Overinflated year-end 2015 reserve values and hard-defaulted credit facilities will combine with an absence of private and public equity markets. The contagion through the expanding and loosely regulated derivative market is surely destined for surprises. Leases will be forfeited and meaningful plugging and abandonment liabilities will build. If the company cannot pay, the banks will be forced to do so.