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Non-Tech : The ENRON Scandal -- Ignore unavailable to you. Want to Upgrade?

To: Mephisto who wrote (1102)	1/24/2002 1:52:33 PM
From: Mephisto	Respond to of 5185

Enron Auditor Refuses to Testify Wednesday January 23 2:27 PM ET By MARCY GORDON, AP Business Writer WASHINGTON (AP) - The Arthur Andersen auditor fired for his role in the destruction of Enron-related documents is refusing to testify to Congress about the shredding, his attorney said Wednesday. He still must show up at the hearing, however. The House Energy and Commerce Committee served a subpoena Wednesday morning on the auditor, David Duncan, to testify at a hearing Thursday. But one of Duncan's attorneys, Robert Giuffra, told the committee in a letter that ``he will rely on his constitutional right not to testify'' unless he is given immunity by the panel. Congress can compel witnesses to show up, but cannot force them to answer potentially incriminating questions without granting them immunity from criminal prosecution. Giuffra said the Energy and Commerce investigative subcommittee is taking the unusual step of requiring Duncan to come before it publicly Thursday and invoke his Fifth Amendment right not to testify. ``He's now flying (to Washington) from Houston and the committee is going to make him exercise his constitutional rights on national television,'' Giuffra said. Most often, when a witness expresses a desire to invoke the Fifth Amendment right against self-incrimination, congressional panels do not require a public appearance to do so. Duncan already has talked to committee investigators. Subpoenas also were served Wednesday morning on Andersen attorney Nancy Temple and risk manager Michael Odom for their testimony at Thursday's hearing. ``No one's getting a free pass on this one,'' said Ken Johnson, spokesman for the House Energy and Commerce Committee. The committee had planned to also subpoena Andersen chief executive officer Joseph Berardino. But the accounting firm agreed late Tuesday to send another top official familiar with Andersen's internal investigation into the document destruction, Johnson said. He said committee investigators were negotiating with Andersen officials over which official would appear. Andersen spokesman Patrick Dorton said ``We have offered and plan to send'' Dorsey Baskin, a top expert at the firm on auditing standards. Enron's own alleged shredding, meanwhile, is being investigated by FBI (news - web sites) agents at the bankrupt energy company's Houston headquarters. In a sprawling inquiry with both financial and political overtones, 11 House and Senate committees are investigating the Enron debacle, while the Justice Department (news - web sites) and the Securities and Exchange Commission (news - web sites) pursue their own less-visible probes. Enron's slide into the biggest bankruptcy in U.S. history on Dec. 2 left thousands of employees out of work and stripped of their retirement savings after Enron temporarily barred them from selling company stock from their Enron-dominated 401(k) accounts. Investors around the country were burned. President Bush (news - web sites) said he was angered that his mother-in-law, Jenna Welch, lost about $8,000 on her investment in Enron stock. ``A lot of the stockholders didn't know all of the facts. And that's wrong,'' Bush said Tuesday. The president has received large political contributions over the years from Enron Chairman Kenneth Lay, who is expected to testify before two congressional committees on Feb. 4. Bush also urged Congress not to be distracted by the Enron investigation. ``I'm confident that all the facts will come out on Enron. And I'm also confident that if Congress has the right attitude, we can get a lot done,'' he said in a pitch for his economic revival plan. In Houston on Tuesday, FBI agents arrived at the soaring headquarters building to look into other alleged shredding while attorneys for investors suing Enron asked a federal judge to bar the company and Andersen from destroying any more records. Enron said it had posted security guards to block employees from floors holding accounting and finance records. The judge urged attorneys for Enron and the investors to come up with a plan to protect company documents and get back to her on Wednesday. Chicago-based Andersen fired Duncan last week for his role in the extensive destruction of Enron-related documents after federal regulators began investigating possible accounting improprieties. Temple and Odom, while expressing willingness to testify, have raised concerns about protecting confidential information relating to the investigation, Johnson, the committee spokesman, said. A former Enron executive, Maureen Castaneda, has alleged that document destruction took place openly at the company headquarters starting after Thanksgiving and continuing until as recently as last week. The Securities and Exchange Commission started looking into Enron's accounting in mid-October, after the company reported a third-quarter loss of more than $600 million. The SEC's inquiry eventually included demands for financial documents from Enron and Andersen. dailynews.yahoo.com

To: Mephisto who wrote (1102)	1/25/2002 3:08:45 AM
From: Baldur Fjvlnisson	Read Replies (1) \| Respond to of 5185

Forecasting Crashes and Recessions What Macroeconomists Don't Know by Hernán Cortés Douglas History does not repeat itself...but it rhymes —Mark Twain "This expansion will run forever." Not two years, or three, or ten. Forever. That was how an MIT Professor of Economics summarized his vision of the U.S. economic expansion in the July 30th, 1998 issue of the Wall Street Journal. Nowadays his assertion appears extreme. It did not then. This exuberance was rationalized by the obvious fact this was a New Economy with no room for recessions. Dornbusch himself said the American economy would "not see a recession for years to come"? Mmmm, why? Because, Dornbusch again, "We don't want one, we don't need one, and, as we have the tools to keep the current expansion going, we won't have one." "We", apparently, are the macroeconomists. More Dornbusch: "Only natural causes, and not the Fed, can bring the economy to a standstill. Fortunately, we have the monetary and fiscal resources to keep that from happening, as well as a policy team that won't hesitate to use them for continued expansion." In the latter part of the 1990s, euphoria was rampant and not only in the States. "It is hard to imagine any article with worse timing than, say, 'Asia's Bright Future,' by Harvard Professors Steven Radelet & Jeffrey Sachs, writing in the November/December 1997 issue of Foreign Affairs". So J. Orlin Grabbe told us. Their article was published at the precise moment East Asian financial markets and economies were deepening their collapses. As Grabbe put it: "Of course Asia probably does have a bright future, much as Europe could have been said to have had a bright future during the Black Death years of the 14th Century."[1] It is one thing to say crises are undesirable, but another to say macroeconomists are, firstly, so skilled at forecasting they can predict trend breaks to the downside; and secondly, they have the tools and the policy teams to avoid economic and financial crises. If this were so, why do they utterly fail over and over again at forecasting economic downturns? Why do they have to adjust their projections over and over in times of trend change? Why has Japan stagnated for 11 years and had three recessions during that time? The dismal record of forecasting crashes and recessions we economists have is not new. The crash of 1929 and the Great Depression came as an unexpected avalanche to economists, particularly those in the hall of fame.......... gold-eagle.com