Essay on Enron Fall

Throughout the late 1990s, Enron was almost universally considered one of the country's most innovative companies -- a new-economy maverick that forsook musty, old industries with their cumbersome hard assets in favor of the freewheeling world of e-commerce. The company continued to build power plants and operate gas lines, but it became better known for its unique trading businesses. Besides buying and selling gas and electricity futures, it created whole new markets for such oddball "commodities" as broadcast time for advertisers, weather futures, and Internet bandwidth (Brian, 2002).

Enron Corp. collapsed last fall because of massive failures by its management, board and outside advisers as well as self-enrichment by some employees "in a culture that appears to have encouraged pushing the limits.

“Smitten by the genius with which it manipulated successive U.S. presidencies, the late great Enron Corporation tried to manipulate its own investors. Shareholders — who had not balked at Enron’s political machinations — forced it into the largest bankruptcy in U.S. history by dumping its stock when they learned that Enron had played them for chumps” (Web, 1). Senior officers and the board of directors made a "fundamentally flawed" decision that ultimately led to the collapse of the company, once ranked as the nation's seventh-largest corporation.
The board, on recommendation from Chairman Kenneth L. Lay and president Jeffrey Skilling, waived ethics rules in 1999 and allowed Enron's chief financial officer, Andrew Fastow, to head up private partnerships that would buy and sell assets with the company, even while Fastow kept his position at Enron. The board and top executives then neglected to monitor Fastow's activities, or even ask how much he made -- $30 million -- until last October, after media reports.

In one transaction in 2000, Fastow turned one partnership investment of $25,000 into a personal $4.5 million profit in two months..................

ESSAY ON THE AMERICAS