[ThinkingMan]

Quite simple- Clinton paved the way for an Enron plant in India that was controversial at the time, and received a payment (I mean "donation") from Enron 4 days before India gave final approval on the plant. Enron called the current administration looking for help when they were in trouble and were told no. They are now bankrupt. This whole debacle could easily be shown to highlight why government interference in a free market system only leads to trouble. (Bear with me on this one): 1996 Enron stock price: mid to high teens 1997: $20's 1998: $high 20's to 30s 1999: $30's to mid 40's 2000 Enron stock price: $50-90$ Today: .67 Notice the sharp increase after direct government intervention (paving way for the India plant) this increase in value encourages an increase in the volume as well. Because of government intervention, more people had more of their money in Enron than likely would have if the India plant had failed to be approved. While I understand that this overly simplifys the issue, ignoring a myriad of issues that account for the stock price and volume, the meat is simply this: Enron may not have been a viable and competitive company, they only looked that way because of inaccurate and untruthful financials. If Clinton had not intervened, there is a good chance that this would have been played out when Enron's market cap was much smaller, and the impact would have been smaller. (or Enron may have adjusted their operations and become hugely succesful on their own merits through sound business practices). The market has simply discovered that financially Enron was a sheep dressed as a wolf. Once the sheep was exposed it was devoured. (Gotta love capitalism!)

[moneyrunner]

"Notice the sharp increase after direct government intervention (paving way for the India plant) this increase in value encourages an increase in the volume as well. Because of government intervention, more people had more of their money in Enron than likely would have if the India plant had failed to be approved. While I understand that this overly simplifys the issue, ignoring a myriad of issues that account for the stock price and volume, the meat is simply this: Enron may not have been a viable and competitive company, they only looked that way because of inaccurate and untruthful financials."

Thank you. You are one of the very few who see Enron for what it is. I would argue with you that the staggering increase in the price of Enron stock was more due to the perceived electricity shortage and the technology bubble than to the plant in India.

The problem with the Enron collapse is that most people are financially clueless. So they assume that there must be political corruption at the base of this. There may be some associated with the $100,000 contribution to the DNC in return for help in India, but the reasons for Enron’s collapse are too much debt guaranteed by Enron stock. When the stock price tanked, the debt came due. And the Bush administration did not ride to the rescue. That’s the free market.