Enron
An old saying is history will always repeat itself. Yes we remember California and the high cost of electricity. Yes we remember ENRON and its chairman Kenneth Lay. " It is the largest electricity marketer in North America, yet it produces almost no power, it is the world's biggest natural gas trader, yet it doesn't dirty its hands. It provides financial services, but not like banks or brokerages that have come before. It ENRON CORP. and it baffles even the lawyers, economists, and government cops who are prying into its dealings, trying to decide whether the energy giant should be praised or buried (www.usnews.com).The question is who killed Enron? Enron was supposed to be the next new thing, a New Economy company with substance to it. Unlike flaky Internet start-ups that substituted ethereal yardsticks like "eyeballs" and "stickiness" for revenues and profits, Enron had real businesses, real assets, real revenues and what seemed to be real profits. It owned natural-gas pipelines and electricity-generat
Question are being asked about how Mr. Lay was able to quietly sell stock all through last year while, as late as September, rallying staff with the advice that it was" an incredible bargain". The complication, instead of rising, Raptor's stock holdings plummeted in value. Whistle -blower Watkins warned in her memo that to offset Raptor's significant losses-Avici stock dropped 98%, from $178 million to $5 million, and the New Power CO. shares dropped from $40 to $6-Enron would have to issue even more stock to keep Raptor afloat. Aggressive Accounting, by capitalizing its web of complex partnerships with its own stock, Enron managed to make losses look like gains. The Strategy when Enron wanted to invest in other companies' stocks- a commonplace transaction for large corporations- it could have negotiated a fair price with a competitor to raise capital to make the stock purchases. Instead, it created thousands of complex partnerships, including two-called Condor and Raptor, to allow the transactions to be tr
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Approximate Word count = 686
Approximate Pages = 3 (250 words per page double spaced)
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