[Newspoetry] [Sdas] subject: enron (fwd)

[Anne Bargar]

thought you folks might like this.

-babs



In a message dated 02-02-06 19:42:00 EST, bmenco at northwestern.edu writes:

 Subject:  Enron

In case you were wondering how Enron came into so much trouble, here is an
explanation reputedly given by a Colorado professor to explain it in terms
his students could understand.

Capitalism
You have two cows.
You sell one and buy a bull.
Your herd multiplies, and the economy grows.
You sell them and retire on the income.
Enron Venture Capitalism
You have two cows.
You sell three of them to your publicly listed company, using letters of
credit opened by your brother-in-law at the bank, then execute a
debt/equity swap with an associated general offer so that you get all
four cows back, with a tax exemption for five cows.
The milk rights of the six cows are transferred via an intermediary to a
Cayman Island company secretly owned by the majority shareholder who
sells the rights to all seven cows back to your listed company.
The annual report says the company owns eight cows, with an option on
one more. Now do you see why a company with $62 billion in assets is
declaring bankruptcy?
 
 



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