Saturday, July 17, 2010

Moral Hazards

From the FT.

Cameron to fight BP’s corner in US
David Cameron will next week defend BP on a two-day visit to Washington, insisting the group must have a “stable and strong” future for the sake of the UK economy and the pensioners who rely on its dividends

Moral hazards everywhere. Now are world scale oil companies could also say the same about themselves. They can go and behave like cow boys, enjoy the upside and ask for forgiveness if their misadventures blow up in their face.

Everyone is in the business of looking for others to bear their risk but collect the gains for themselves. A very unjust system.

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