Gulf Of Uncertainty
The BP oil spill in the Gulf of Mexico has been a bleeding wound that couldn't be stanched, threatening to drain the economic life of the region. For the folks who live in its wake, two words that frequently come to mind--besides "anger" and "sadness"--are "uncertainty" and "moratorium."

The latter refers to the Obama administration's proposed six-month halt of deepwater drilling projects in more than 500 feet of water, which residents worry could hurt the area economically. A U.S. District Court judge rejected the administration's measure in June, but the government is fighting that decision. 

"When I ask people down there what they're most concerned about, they say the uncertainty of the drilling moratorium more than the immediate impact of the oil spill," says Jude Boudreaux, director of financial planning at Bellingrath Wealth Management in New Orleans.

Boudreaux is from Lockport, a town of 2,600 people roughly an hour south of New Orleans. He says folks on the bayou aren't sure what to do because there's still too much uncertainty about both the drilling freeze and the ultimate environmental damage and its potential impact on the region's fishing industry and way of life.

"There's nothing really profound I can tell people until we really know what'll happen from a settlement standpoint," Boudreaux says. "At least with [Hurricane] Katrina there was a lot of pro bono work to be done to help people file for claims. With flood insurance, there was a playbook."

Boudreaux says the $20 billion oil spill fund created to compensate Gulf Coast oil victims could itself cause uncertainty. "My concern is that a lot of people down there do a lot of cash business and might not have receipts to prove past sales numbers," he says. "A lot of business is done on handshakes and trust on the bayou."

Boudreaux says the millionaire-next-door syndrome applies to a number of people in southern Louisiana thanks to the regional economy's twin pillars--oil and gas on the one hand and fishing on the other. "There might be second- or third-generation family businesses and they run a couple of boats. It might not look like much because they aren't showy about their money. There is some substantial wealth down there, but it's a different kind of world. The concern is whether those jobs and a way of life will go away."

John Sirois, a financial planner with Raymond James in Houma, La., worries that the drilling suspension would slam the finances of Terrebonne and Lafourche parishes, along with local governments in the region. Houma is home to a lot of oil and gas drilling-related operations, from large players such as BP, Schlumberger and Halliburton to numerous small and midsize local companies that furnish goods and services to the offshore industry.

Recently, Sirois got a client referral-a "high-end" BP employee-who wasn't planning to retire for another few years but who is now concerned his pension would be affected if the company files for bankruptcy. He's meeting with Sirois to discuss his options, including early retirement.

Ultimately, the oil spill's impact could be broad. According to a Wall Street Journal article, it's estimated there will be 16,500 fewer jobs in the fourth quarter along the five Gulf states because of the spill.