John McLaughlin: "Ten more major corporate ethic scandals will surface over the next six months."

TMG ^ | 22 June 2002 | John McLaughlin

[buaya]

Over the weekend (21-22 June), I caught the last segment ("predictions") of The McLaughlin Group TV program.

Host John McLaughlin's prediction:

"Ten more major corporate ethic scandals will surface over the next six months."

Since then, we've had the Worldcomm, and today, the Xerox revelations.

Anyone want to start placing bets on Numbers 2-10???

[sibb1213]

Oh we are diversified believe me but still lots of GE Stock.
I know the stock has suffered since the three for one split and there are lots of reasons but since the Bill Gross statements, Enron, etc., we have hit new lows since 9/11 and can't seem to stay up. Lots of factors. Trust me, I study this constantly. Can't let it get to you though. My husband and I are 55 year old retirees and have new careers with less stress. We will be fine.

[vharlow]

How about all the insurance companies that in recent years demutualized? Having a close association with one of them, I can tell you many of us suspect huge, I mean huge profits in the pockets of CEO's and other VP's and they will cut staff, cut expenses like crazy, and sell to the highest bidder from banking or foreign insurance organizations. Or that's what many of us suspect.

[muleboy]

Or better yet, start with Arthur Anderson's former client list. Their new auditors will not coverup for them. 10, 100, 300? We should know by Christmas.

[rohry]

First off, there is a lot more than 10.

My top 5 suspects is:

GATA (any company taking part in the gold scandal)
JP Morgan (leveraged derivatives at 750 to 1)
GE (mostly because of huge amounts of debt and potentially bad loans via their GE Capital division)
CitiGroup (only because Rubin is there, since the '80s wherever he goes there have been problems)
Cisco (lots more writeoffs coming, but they are desperate to show that a turnaround has started)

[Jim Noble]

Any company whose CEO was a prominent FOB (Friend of Bill)-AOL-Time Warner and Apple Computer certainly come to mind, but I'm sure freesearch will come up with more...

[ameribbean expat]

I think the next round will include a few European companies-- witness the first bankers indicted in the Enron scandal (today's FT): three Brits. European companies listed on US exchanges must report IAW GAAP to maintain their US exchange listings. So I'm thinking ADRs or European companies that have merged with large US companies previously listed (think Daimler Chrysler or some of the European banks that acquired US investment banks like UBS-Warburg) Otherwise I would say follow the Andersen audit trail, it seems to be a reliable guide so far.

I'm a goldbug and I've followed GATA for a loooong time. If gold is going to make its move (and it already has been a great blessing for those of us who have been in unhedged junior mining companies for the past 18 months), it needs to do it while there is general upheaval in the US financial markets. Too many vested interests around the globe want to keep the US Dollar as the world's reserve currency (until something better comes along). Hint: it ain't the Euro: Italy cheated and used derivatives to disguise the actual amount of debt on its books to get in, Germany recently blew threw the debt ceiling demanded by the stability pact without any consequences and that would make the French the honest brokers...that's a joke people.

[RightWhale]

It's true that Loral had to write off a huge investment last year. I have their anual report. It looks like they will be able to weather the next couple of years of poor business conditions for commsats. OTOH, for Loral it's their main line of work these days while for Boeing it is a sideline. I think Loral has been upfront with their fiscal problems, but if something smelly turns up it will be educational in a couple of ways.

[ameribbean expat]

here's a reliable list of former andersen clients:
http://www.forbes.com/home/200 2/03/13/0313andersen.html

[Donald Stone]

My personal opinion on GE is that they are building firewalls between GE and some of the firms that provide them
with professional services.

[Donald Stone]

And corporate legal counsel !!!!!!!!!!

It's company management that drives the accounting policies & procedures.

[Wyatt's Torch]

Q, LVLT, Charter, Sun, Oracle, one of the RBOC's. The biggest ones in danger are the mid-size "growth" tech firms. They were the ones under the most pressure to meet earnings.

While I don't know who they will be...ther will be more.

[cgbg]

Fleet Bank

FNMA

GNMA

When those last two blow that means there will be no bottom to the market, because it will mean a derivative holocaust has struck.

[Wyatt's Torch]

If it's CSCO and/or GE...look out below. It's all over then.

[cgbg]

Diversify your retirement portfolio.

Now!

If you are not at least 50% cash or cash equivalents or gold or gold equivalents you are just asking for it!

[rohry]

"If it's CSCO and/or GE...look out below. It's all over then."

I'm almost certain on GE, Cisco is a guess...

[buaya]

"It looks like McLauglin is turning into quite a prophet."

I hardly ever watch the show anymore, but back in the early to mid 80s, The McGlaughlin Group and WFBjr's Crossfire were the ONLY conservative news programs on the tube. Fred Barnes, Mort Kondracke, Tony Blankely and so many other regulars on Fox News got their start on TMG.

As time went on, his personality began to annoy me, and by the early 90s there were more conservative voices, so I slowly drifted away from his program. Nevertheless, I'll still pause for a few minutes and check out what's going on, when I come across his program while flipping through the channels.

[gwynapnudd]

There appears to be a link between major sports stadium sponsorship and corporate skullduggery.

[Billy_bob_bob]

I look at JP Morgan's numbers and I start to twitch. The numbers on their derivitaves exposure look like something out of a grade school argument: "My daddy has eleventy skillion dollars! MY daddy has eleventy skillion ZILLION dollars!"

In all seriousness, could I get a graph or a chart comparing the total amount of derivitaves exposure JP Morgan has as compared to the total amount of all of the money in the world? I'm thinking that would be a very interesting chart indeed.

[murdoog]

Any company whose CEO was a prominent FOB (Friend of Bill)-AOL-Time Warner and Apple Computer certainly come to mind, but I'm sure freesearch will come up with more...

Tyson Foods. I'm surprised no one has mentioned them yet.