The general inability of companies to make a profit from fracking means the industry must keep borrowing new debt to pay back existing debt: “…the very definition of a Ponzi Scheme.”
The article includes an embedded 30 minute video, where Steve StAngelo sets out the entire case. Even if he has got it only half right, the pervasive blindness to the debt pile and the prospects of it ever being serviced continue to defy belief. But then so it did in the mortgage-backed securities Ponzi scheme in the run up to the credit crunch in 2007 and financial crisis in 2008. And I don’t think Steve is half right: have a look at the EOG Resources debt scheduling table in his article. Would you buy any of that?
Image: from article, adapted
