Posted on 11/30/2001 7:04:33 AM PST by liberallarry
Edited on 09/03/2002 4:49:35 AM PDT by Jim Robinson. [history]
When the stock of energy giant Enron fell to 36 cents per share this week from a high of $84 this year, the market finally accepted the reality that the company--a middleman whose main business was not producing or delivering power but trading it--was never really needed. Investors, who unlike Enron executives, didn't sell until too late lost their retirement savings and children's college tuition to the illusion. More.
(Excerpt) Read more at latimes.com ...
I just got this from another thread. If true, it changes everything. Enron then becomes a bunch of fast-buck artists pulling a new type of Ponzi-scheme scam.
"Greed is good!"
This writer has no clue of the important function of that traders bring to a market. They provide liquidity and also absorb risk. He should read about commodity and futures markets and learn, before looking like a dumbo.
"Greed is good!"
Can you say "dotcom"?
Hmmmm... Looks like our stock price could use some support, and I just heard that a Big-5 CPA firm just got busted for cooking Waste Management's books. Hey, I know! Let's hire that Big-5 firm's consulting affiliate and then see what they will do for our books!
That's exactlty what Enron was about! And they darn sure aren't the only ones. They are one of the big players in the Clinton era bubble/ponzi/scam economy of the 90's. The Bush administration has inherited the hangover. The Bush family were also serious players/partygoers too...so maybe this is karma...
Suggest looking into the Dhabol power plant in Western India, an Enron venture.
Suggest looking into what business ventures the past CEO's (Chairman) of Enron are now into.
Some people made a ton of money, but it wasn't the average little share-holder or those pee-ons who stayed loyal working for Enron.
sw
Maybe your comment would be better directed at Enron.
I wasn't aware electricity was a "commodity" traded publicly like Hillary's cattle future's.
I never trusted that repellent old guy on the Enron commercials who muttered about old ideas that should be jettisoned, and I didn't even know he apparently counted among them GAAP!
Sounds like a description of a lot of American businesses. We export our jobs and factories 'cause we want to be an 'information' and paper trading economy.
One good way to make a company more efficient is to eliminate a layer of middleman management. Watch for more unneeded dominos.
The stakes are also high for the investors. For phase two, several banks have put up $4, 600 million. Funding has also come from various Indian institutions, Japan's Export-Import Bank, the Japanese Ministry of Trade & Industry (MITI) and the Belgian export credit agency. Funding from US banks was made more difficult following the US government sanctions against India (prompted by the India nuclear test). General Electric (GE) is tied in to the Dhabol project through a 10% stake. This is well worth the company's while, since it is supplying the power generation equipment as well as providing much of the finance. This helps GE penetrate the Indian power market. India's steady growth rate, and currently underdeveloped power infrastructure, suggest it will be a prime market over the next decade. Recently, GE has become involved in not only the Dhabol project but also the Ib Valley project and the Mangalore project. These projects may amount to $ 80 million.
Enron's butt was way overexposed. It look's like GE is out there for 1/2 billion on this project, but I don't see too much of down-side for them since they got to book one hell of a lot of sales of their iron.
As you point out, it's the little people that got screwed.
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