True, but that basket sure looked pretty in the picture, didn't it? The company grossly misrepresented their "basket" so that investors wouldn't be able to see what a POS it was becomming until it was too late. All most of these (now) poor folks had to go on was Enron's financial reports, same as with any other company. Had Enron not filed phoney reports, maybe those folks would have diversified their portfolios sooner.
True, but that basket sure looked pretty in the picture, didn't it? The company grossly misrepresented their "basket" so that investors wouldn't be able to see what a POS it was becomming until it was too late. All most of these (now) poor folks had to go on was Enron's financial reports, same as with any other company. Had Enron not filed phoney reports, maybe those folks would have diversified their portfolios sooner.
This sentence is BS and everyone knows it. He was charged with "98 counts of insider trading, fraud, money laundering, tax violations and others for allegedly running a complicated web of partnerships and financing methods that hid debt, inflated profits and funneled millions of dollars to him, his family and chosen friends and colleagues." Is what he did worse then a single murder or rape...maybe. They ruined people's lives...who's to say what the damage from that will be.
The wife pisses me off the most:
"Lea Fastow is charged with six counts of conspiracy and filing false tax forms for allegedly helping to hide income and make one of those partnerships appear independent of Enron so the failed energy giant could continue getting tax benefits for wind farms after buying a utility. "
She wasn't just an accomplice, she was commiting fraud as well. And she had the audacity to complain that dual sentences would be unfair because one of them had to be home to raise their two sons. Someone should ask her what she's going to do about the numerous college funds she and her husband wiped out along the way and who's going to take care of those kids.
People like this piss me off because they abuse the system and create the need for regulation. Worse yet, this will probably be the most severe sentence handed down over the whole thing.
EDIT : SOURCE
The wife pisses me off the most:
"Lea Fastow is charged with six counts of conspiracy and filing false tax forms for allegedly helping to hide income and make one of those partnerships appear independent of Enron so the failed energy giant could continue getting tax benefits for wind farms after buying a utility. "
She wasn't just an accomplice, she was commiting fraud as well. And she had the audacity to complain that dual sentences would be unfair because one of them had to be home to raise their two sons. Someone should ask her what she's going to do about the numerous college funds she and her husband wiped out along the way and who's going to take care of those kids.
People like this piss me off because they abuse the system and create the need for regulation. Worse yet, this will probably be the most severe sentence handed down over the whole thing.
EDIT : SOURCE
Word of the day is DIVERSITY.
If people are stupid enough to have all their funds in one company they deserve to lose it all.
Viper GTS
Nitemare
Lifer
- Feb 8, 2001
- 35,461
- 4
- 81
I would have prefered the chair or at the very least life imprisonment of hard labor while they work off their debt to society, all 45 million worth.
You get a minimum for 20 years for robbing a bank...Isn't this a little worse than that. Banks are insured, people that have put all their eggs in one basket(incredibly stupid mind you) for retirement are not.
They got off. They will do their 10 years which will actually be equal to 2 years active in a minimum security resort prison and 2 years probation. They will do their 4 years then fly over to Switzerland and pull out their 34 million and live in some exotic location sipping on Mai Tai's all day while bombshells frolic topless in the sand.
The court system is becoming an absolute joke.
You get a minimum for 20 years for robbing a bank...Isn't this a little worse than that. Banks are insured, people that have put all their eggs in one basket(incredibly stupid mind you) for retirement are not.
They got off. They will do their 10 years which will actually be equal to 2 years active in a minimum security resort prison and 2 years probation. They will do their 4 years then fly over to Switzerland and pull out their 34 million and live in some exotic location sipping on Mai Tai's all day while bombshells frolic topless in the sand.
The court system is becoming an absolute joke.
I hope that investors with a significant amount of their eggs in this basket should've watched that basket, ie read the annual reports.
???? That is what this whole thing is about. They LIED to all their investors saying they were making millions of dollars, making the company seem like it was doing very well, when actually it was losing a ton of money. Then the Exects sold millions of stock when it was high. Then the stock went down to almost nothing. The annual reports weren't accurate at all. The reason pople bought a lot of the stock is because they actually did read the annual reports.
Don't get me wrong it certainly is dumb to invest all your money in one company.
I don't understand why you guys are saying the investors were idiots and they deserve to lose it all. How do you these people know that they should "diversify". I've only been working in the industry for 3 yrs. but I did not know about diversity until the tech. bubble burst and all the scandals with big corporations. How did you know that you should diversify, did you just figure out one day that it was not wise to invest in the company you're working for, even though earning reports were good?
It like saying, you shouldn't have started your savings account with citibank ... you should have split up your savings acct. to various places ... no way did they deserve to lose it all ...
I wouldn't say they deserve to lose it all but it's common sense that you don't put your retirmement savings into one (or only a few) stock(s). A stock can swing as much as 100% (or more) in one year, savings accounts are almost completely riskless. What rock have been under that you've never heard to diversify your retirement savings? Most advisors will tell you to stick with mutual funds, and diversivy amongst those.
What he did was just as bad or worse, based on my following of the Congressional hearings this was mostly a Fastow operation. But the reason I'm posting is your point is backward, nobody should serve less than 10 years for rape either. "Shooting" isn't defined in your post so I don't know what you mean as far as that part of your post.
Andy Fastow, former CFO, started partnerships to get debt off Enron's balance (at the end 2/3 of Enron's 40 Billion, or so, debt was off the balance sheet.) The lower debt kept Enrons credit rating up which allowed them to borrow money at a lower interest rate. These special purpose entities, as they were called, only require that 3% of the equity come from outside sources (ie., Enron would pay 97%.) Fastow was the mastermind behind these SPE's and made upwards of $60 million profit from them. The way it works is the SPE "buys" an asset from Enron but only pays 3% for them. This way Enron can take that debt off its balance sheet because it no longer "owns" the asset. The problem was the accounting rules require the SPE to actually take some risk which Fasow never did. I highly recommend
this book to anyone interested in Enron.
It's common sense, why do you think everyone is talking about eggs and baskets? How many people here have ever dealt with eggs & baskets? That phrase has been around forever, & addresses a very simple concept.
As for the savings accounts, that's quite different. Savings accounts are FDIC insured, and CANNOT lose money (under the $100K mark). Stock investment is entirely another story, & the risk falls squarely on the shoulders of the investor.
Foolish investing/planning may be the only thing worse than none at all.
Viper GTS
Yeah whatever dude!
I guess then if your stupid enough to send me $2,000 for an alienware top of the line laptop after I create some bogus heatware then its YOUR FAULT. Don't come crying to anyone. I think its pure crap that you think the investors deserved to be pennyless.
did i miss something? did account holders with citibank lose their money? isn't that what fdic insurance is for?
and you should always diversify, that's just a given in investing. any investor with half a brain that throws everything into one company is gambling and they know it.
These bastards set up fake companies to hide Enron's debt and make the financial situation looked a whole lot better than it really was. Once the huge debt surfaced, the company went bankrupt. It was at one point one of the largest companies in the country. Now one of the largest bankruptcy ever.
The execs also skimmed tens of millions of dollars for themselves.
Babbles
Diamond Member
- Jan 4, 2001
- 8,253
- 14
- 81
Look, okay yes the Enron execs did screw up big time. However, I seriously doubt any of those execs forced people to invest 100% of their retirement into Enron stock. The investors did that on their own, therefore they should have some personal responsibility in their actions.
People expect the Enron execs to be held responsible for their actions, so why is it so bad to have the same expectations from the investors?
A diversed portfolio is basic investment 101, not too difficult to reach that conclusion. I think that the investors, quite frankly, should have known better.
People expect the Enron execs to be held responsible for their actions, so why is it so bad to have the same expectations from the investors?
A diversed portfolio is basic investment 101, not too difficult to reach that conclusion. I think that the investors, quite frankly, should have known better.
Nitemare
Lifer
- Feb 8, 2001
- 35,461
- 4
- 81
You get 5 years for knocking over a liquor store. Let's just say they knocked over the equivalent of 86000 liquor stores 86000 x 5 years is 430,000 years.
As I said earlier the 10 year sentence which will probably be 2-3 years actually is a friggin joke as are alot of judges for being such hypocrites.
As I said earlier the 10 year sentence which will probably be 2-3 years actually is a friggin joke as are alot of judges for being such hypocrites.
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