WCOM.
From a daily newsletter.
...If WorldCom defaults , it will be the largest default in US history - surpassing Enron. What is now in question (and one can see it in the dollar's decline in the fx markets) is the reliability of the US stock market's checks and balances with respect to corporate governance and transparency. Let's not mince words: what transpired by WorldCom, Enron, and Arthur Andersen was fraud, plain and simple. Furthermore these weren't "dot.coms", or fledgling upstarts run by 26-year olds: they were major US corporations with real directors, and real assets and real banks backing them. All gone, all fraud.
With a P/E of 40, it is quite apparent that the "E" is a complete mirage of financial engineering. The way that consultants (banks, M/A, accountants, tax lawyers) work is that you do, do the same at other places if it "works". These were fraud, but I doubt they were the only two out there.
God help the stock market.
-macavity |
