The Hits Keep on Comin'

Am I the only one thinking that perhaps karma exists after all?

You've read plenty on this site in the past few weeks about our friend Aubrey McClendon and the financial 3-card monty he's been playing with Chesapeake Energy. Now, it's really starting to hit the fan. From the AP:

Chesapeake Energy CEO forced to sell company stock

Aubrey K. McClendon, chief executive of Chesapeake Energy Corp., has sold the bulk of his stock in the company over the past three days in order to meet margin loan calls, the company said Friday.

The company did not disclose the size of the stock sale, pending the filing of documents with the Securities and Exchange Commission.

"I am very disappointed to have been required to sell substantially all of my shares of Chesapeake," McClendon said in a news release. "These involuntary and unexpected sales were precipitated by the extraordinary circumstances of the worldwide financial crisis."

Extraordinary is just about hitting the nail on the ol' head, I would venture. Remember how I wrote earlier that McClendon's decrease in net worth was on paper only, that the dip (or plummet) in share price did not necessarily mean he was losing money?

Yeah, well, that went out the window over the past 3 days. McClendon bought millions of shares this summer at $55 a pop, and just got finished selling them for about $17 each.

I don't speak fluent Oklahoman, but does the phrase "hurtin' for certain" apply here?

[Thanks to Alan for the tip.]

Follow Up

Before I dive into this story, let me make this point perfectly clear: I am not digging into Chesapeake Energy's misfortunes because I want the Oklahoma City Thunder to fail. As far as I (and I think Raf and Paul would agree with me) am concerned, the Thunder belongs to the people of OKC now, at least as much as any pro team belongs to any city.

I'm not interested in ragging on Oklahoma, or talking about how much more sophisticated Seattle is, or any of that nonsense. I'm putting these stories up solely because McClendon, Bennett, Tom Ward, and David Stern disgust me, and if I can poke some small holes in their swollen egos, then so much the better.

On with the story. Today's WSJ has a, well "scathing" would be putting it too strongly, so how about negative story about Chesapeake Energy, including this stirring quote from writer Ben Casselman:

"But [the land Chesapeake owns] is only valuable if companies have the money to drill it -- and a growing number of analysts are skeptical that Chesapeake and some of its peers will be able to find enough money to drill all the land before the leases expire."

Perhaps the Journal's story had a little bit to do with CHK's stock falling by more than 5 points by mid-day on Friday, a one-day drop of nearly 30%, putting it at $12.35 from a high of $70.

Peaking in on Chespeake

Perhaps I should let this go at some point, but take a gander at Chesapeake Energy's stock performance since July of this year:




In case you can't make out the figures, the stock value has gone from a high of $70.24 in early July to a low of $17.71 at closing today. That's a loss of $52/share, which, if you have 34,000,000 shares like some people do, in the last three months your net worth has declined by the sum total of $1,768,000,000.

Yes, nearly 2 billion dollars. Or, put another way, in the time it took the Sonics to relocate to Oklahoma City and play their first game, Aubrey McClendon lost the equivalent of the GDP of Zimbabwe.