I got ask to expand on the Enron post on another thread. Thought I would add it here:
Do you really think there is only one Enron out there?
No, I don't. One reason the market is down right now is that people realize that companies have to clean up their accounting.
The truly untrustworthy here are the Wall Street stock analysts who never signaled trouble but should have known it, the lazy media commentators who act as shills for the analysts, and the SEC officials, who are supposed to prevent this kind of thing but actually make is more likely by engendering a false sense of security and mitigating the all important adage about "Buyer Beware."
Companies will go out of their way now to show the world that their financial statements are accurate and reliable. Accounting Firms will do the same, to bolster their reputations.
The negative results will take the form of still more regulations.
Remember the subsidiary premises that Liberals, and a lot of Conservatives, work on. They are as follows.
1) Selfishness and greed are evil
2) Capitalism is based on selfishness and greed
3) Therefore: any evil outcome you see - such as fraud, bankruptcy, influence peddling and lost pensions- must be due to greed and capitalism.
They think that there's not enough regulation because, they say, evil did occur - and that means that some degree of capitalism, even if just a smidgen, still remains. |
