BP needs to be able to borrow...very bad until they can easily

There are already signs that trading partners are becoming wary of BP’s financial outlook; one market participant, Bank of America Merrill Lynch, is halting long-term contracts with BP. The company’s deteriorating credit rating — on June 15, it was downgraded byFitch to one notch above junk bonds — makes it harder for traders to cheaply deploy vast amounts of cash. And with its stock down by more than half since the blowout in the gulf, BP can only watch as rival firms try to poach its best traders.

“A lot of the swagger comes from the amount of money they have to trade with,” said Craig Pirrong, a director at the University of Houston’s Global Energy Management Institute. “And traders realize they don’t have the capital they had just a couple of weeks ago.”

It is a humbling moment for a secretive unit that earns the company $2 billion to $3 billion annually and has long inspired fear and envy among rival traders.

BP declined to comment for this article.

this could be the 1st sign of a huge shift in financials...

The FDIC, with its long history of resolving failed banks, would act as receiver, selling off the assets.

Ms. Bair said the existence of this new authority would prompt investors to shift capital away from the biggest financial firms toward smaller ones, strengthening them after a wave of consolidation in the financial industry created some competitive disparities. She predicted that investors would favor smaller firms whose risks are more transparent, raising capital costs for bigger ones.

Ms. Bair, who often clashed with other key officials over how to keep the financial system afloat during the crisis, said uninsured bank depositors got a raw deal compared with the bondholders and derivatives counterparties of bailed-out firms who came out whole.

"I think that was a terrible inequity," Ms. Bair said. A provision of the financial-overhaul bill would retroactively apply the now higher limits on federally insured deposits at six banks that failed before Congress raised the limits in 2008.