Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Enron - Natural Gas Industry -- Ignore unavailable to you. Want to Upgrade?

To: ms.smartest.person who wrote (1212)	12/18/2001 1:23:04 AM
From: ms.smartest.person	Read Replies (1) \| Respond to of 1433

BW/ Skilling's Strategy: What Went Wrong? THE BIG IDEA THE PROBLEM Create an "asset light" company. Some partnerships required Enron to Skilling applied Enron's trading kick in stock if its rating and and risk-management skills to stock price fell below a certain power plants and other facilities point. Enron could be left holding owned by outsiders. To maintain the bag on about $4 billion in a high credit rating and raise debt. With its stock and asset capital, Enron moved many of its values falling, Enron was vulner- own assets off the balance sheet able. And when things started to into complex partnerships. unravel, its murky finances spooked investors and lenders. Expand Enron's energy trading Enron tried to do too much, too expertise into a vast array of fast, with little or no return. new commodities to sustain It invested $1.2 billion in fiber- earnings growth. Skilling en- optic capacity and trading facili- visioned taking on markets ties, but the broadband market ranging from paper goods to crashed. And it was never able to metals to broadband capacity. show that it could generate the profits it got from energy trading in markets such as metals. Copyright 2001 , by The McGraw-Hill Companies Inc. All rights reserved. Used with permission of businessweek.com