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

To: Raymond Duray who wrote (2148)	2/2/2002 11:58:59 AM
From: The Duke of URL©	Read Replies (2) \| Respond to of 5185

From your URL: Q. What does ``leveraging'' mean? A. Lying. I must tell you that statements like that are what politely may be called "inoperative", i.e., they don't help understand or inform about this or any problem. They are cute, witty and utterly USELESS!! I have now reviewed the Partnoy testimony before the Senate Committee on Government affairs, and have scanned the May 2001 10Q and the April 2001 10K as filed with the Edgar database. It may be of some passing interest that these documents seem to me at least harder to find from the usual internet places. It occurs to me that some of the internet web sites are busily ERASING the documents so that no one will ever claim that the website participated in the misdirection that will be alleged. :) Let me give you one example of "operative" information. MY OPINION ONLY DO NOY RELY, etc. From the LJM2 offering prospectus, as posted, WITHOUT EXTENSIVE REVIEW, MY OPINION ONLY, ON A PRELIMINARY BASIS: This is how it worked: I am a bank. I want to lend money to Enron. The Senate has just passed a bill which allows me the bank to own a Brokerage house. Clinton might have vetoed this legislation but if he does, it might just be that the Senate will institute criminal procedings against him, so the Senate Banking Committee, headed by Gramm (R, Texas) and the Judiciary Committee headed by Hatch (R, Utah) are definately not going to give me any trouble. I (The Bank) have been given the green light, therefore to do the following. We will have LJM get money and use the proceeds to pay Enron to pay down our loan. Friends and family of the bank will lend LJM money and get 30% interest. That will make the balance sheet of enron look so good that we can then pump Enron stock to our unsophisticated depositors and switch them from insured bank deposits to our funds, buy more enron stock use the money to pay down the loans, and start all over again..... To be continued. MY OPINION ONLY BASED ON A PRELIMINARY REVIEW OF VERY FEW PRELIMINARY REPORTS.

To: Raymond Duray who wrote (2148)	2/3/2002 6:31:30 PM
From: Mephisto	Read Replies (1) \| Respond to of 5185

I was tired so I watched that old Republican Rukeyser? Do you know anything about that blond analysis on the show? The one who recommended all the losers: Lucent, Halliburton. I forgot what else she recommended. I wonder who pays her salary and if her company was the underwriter of any of the losers that she recommended. JMOP

To: Raymond Duray who wrote (2148)	2/3/2002 6:42:01 PM
From: Mephisto	Respond to of 5185

Enron was, in layman's terms, a nest of dirtballs Miami Herald E-MAIL TO A FRIEND February 3, 2002 If you're an average layperson, your grasp of high finance consists of knowing your ATM code. So you're probably bewildered by this scandal surrounding the collapse of Enron, which had been the seventh-largest corporation in America. (The sixth largest is the guys who go ``WHASSSSSSUP!'') So today we're going to explain the Enron story in the Q&A format, using simple financial terms that you can understand, such as ``dirtballs.'' Q. How, exactly, did Enron make money? A. Nobody knows. This is usually the case with corporations whose names sound like fictional planets from Star Wars. Allegedly, Enron was in the energy business, but when outside investigators finally looked into it, they discovered that the only actual energy source in the entire Enron empire was a partially used can of Sterno in the basement of corporate headquarters. Using a financial technique called ``leveraging,'' Enron executives were able to turn this asset into a gigantic enterprise whose stock was valued at billions of dollars. Q. What does ``leveraging'' mean? A. Lying. Q. Why didn't Wall Street realize that Enron was a fraud? A. Because Wall Street relies on ``stock analysts.'' These are people who do research on companies and then, no matter what they find, even if the company has burned to the ground, enthusiastically recommend that investors buy the stock. They are just a bunch of cockeyed optimists, those stock analysts. When the Titanic was in its death throes, with the propellers sticking straight up into the air, there was a stock analyst clinging to a railing, asking people around him where he could buy a ticket for the return trip. Q. So the analysts gave Enron a favorable rating? A. Oh, yes. Enron stock was rated as ``Can't Miss'' until it became clear that the company was in desperate trouble, at which point analysts lowered the rating to ``Sure Thing.'' Only when Enron went completely under did a few bold analysts demote its stock to the lowest possible Wall Street analyst rating, ``Hot Buy.'' Q. What other stocks are these analysts currently recommending? A. Mutual of Taliban. Q. Doesn't Enron have a board of directors whose members are responsible for overseeing the corporation? A. Yes. They are paid $300,000 a year. Q. So how could they have allowed this flagrant deception to go on? A. They are paid $300,000 a year. Q. But didn't Enron have outside auditors? Why didn't they discover and report these problems? A. Yes, Enron had one of the most venerable auditing firms in the nation. Q. What do you mean by ``venerable?'' A. We mean ``stupid.'' As a result, Enron executives were able to deceive the auditors via slick and sophisticated accounting tricks. AUDITOR: OK, so you're saying you made $600 million in profit. EXECUTIVE: Correct. AUDITOR: Can I see it? EXECUTIVE: Sure! It's right here in my desk! UH-oh! The drawer is stuck! AUDITOR: Wow! Just like last year! Q. What should be done to punish the Enron executive dirtballs who, knowing the company was in trouble, cashed in their own stock, and screwed thousands of small investors? A. In the interest of putting this ordeal behind us, we believe they should receive only a slap on the wrist. Q. Really? A. With a hatchet. Q. Isn't that a pretty severe punishment? A. Actually, it has been deemed harmless. Q. By whom? A. Wall Street analysts. miami.com