Word: enronize
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...Enron stands out from this sorry list not by virtue of the company's size but because the scandal is of such a fundamental nature. At the heart of capitalism is the act of investment, which is nothing more than a decision by one party to lend money to another in the hope of a return. The system can't function without trust--trust that the money so lent will not be stolen or applied to illegal purposes, and trust that an enterprise's accounts will accurately reflect the state of its business. Company directors, lawyers and accountants are said...
...when investors were drawn mainly from those rich enough to look after themselves. But those days are long past. From 1989 to 1998, the number of Americans who invested in shares--either directly or through mutual funds, savings accounts and retirement plans--grew from 52 million to 84 million. Enron matters because those charged with the trust of such investors--many of them new to the markets--let them down. A system that has brought unimagined prosperity cannot survive if such betrayals become commonplace...
...long ago, many would have placed Enron's Ken Lay--innovative, daring--in the pantheon of American business. That such a judgment could be made by those not otherwise known for idiocy places our value system into question. The task of companies is to provide returns for investors and so create jobs and spread wealth. But by the '90s, top businessmen had become celebrities, writing books (or having them ghostwritten), gracing covers of magazines and preaching the wonders of American management and transparent accounting practices to companies in other countries. After Enron, the audiences overseas for heroes of glamour capitalism...
...Enron affair matured into a scandal just as it began to seem that the culture of celebrity was defunct; suddenly, we remembered that Barbra Streisand was not a political philosopher. Neither is Jack Welch or Bill Gates or, certainly, Ken Lay. In the '90s, we treated businessmen as if they were film stars (and we treated film stars like gods). But we lend stars our affections only; we lend businessmen our chance of future prosperity. A lesson from Enron: we would be wise to entrust that responsibility to those with their feet on the ground, not on a pedestal. Even...
...company's combative CEO, Dennis Kozlowski, predicted the breakup would add 50% to the stock price. Going him one better, Don MacDougall of J.P. Morgan Chase said the move would make the stock worth $80 to $90 a share--double the current price. Haven't they heard? Post Enron, any hint of questionable accounting is the functional equivalent of finding asbestos in everything a company makes. So a day that dawned with promise for Kozlowski quickly turned to loss. By week's end Tyco shares were at $45, down 3% from the day before its breakup was announced--and down...