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Rosen: No quid gained for Enron quo

You knew the Democrats would relish the first opportunity to tag a political scandal on the Bush administration as payback for a parade of scandals that put them on the defensive during the Clinton years. And you knew that liberals in the media would enthusiastically jump on the bandwagon. Sure, they reported on Clinton dirt. But it was with reluctance and a conspicuous absence of investigative zeal and moral indignation. George W. will be pursued with a passion.

They may have their chance someday, but the Enron affair isn't it. The collapse of this $10 billion energy conglomerate is a shame and a tragedy for the company's employees, shareholders and creditors -- and it may well be a business scandal, but as a political scandal, there's no "there" there. When you connect the dots, you come up with a line that goes nowhere.

Now let's see, Enron executives and Enron's PAC gave money to Republicans. Then Enron asked for its quid pro quo, federal government intervention from the Bush administration to forestall a looming bankruptcy. The Bush administration refused, so Enron went down. And the scandal is . . .? A recent Washington Post story said, "There has been no evidence that the administration intervened to aid Enron, and in fact Democrats fault the administration for not acting to help Enron workers and retirees once [administration officials] were told of the situation last fall." Sounds like a case of damned if you do and damned if you don't.

The last time a presidential administration did something for Enron, it was the Clinton crowd greasing the skids for a power plant project in India, for which the Democratic National Committee was rewarded with a $100,000 donation. It should be noted that Enron spread money around liberally to politicians on both sides of the aisle. In the U.S. House, the top seven recipients are all from Texas, Enron's home turf. Five of the seven, including the top two, are Democrats. Yes, during the presidential campaign Enron sources gave more money to Bush than Gore, but how could it be otherwise? Bush pro-business and an oilman; Gore is an "Earth in the Balance" enviro-freak who wanted to impose punitive taxes on energy and scuttle the U.S. economy by ratifying the Kyoto suicide pact. Enron executives may be inept and unethical, but they're not crazy.

Enron's collapse wasn't a failure of capitalism. The marketplace did exactly what it's supposed to. Just as winners are rewarded, the collapse of stock prices and financial failure is the penalty for overreaching, gambling and losing. There are about 100,000 business failures a year, and about 800,000 new incorporations. Schumpeter called it the "creative destruction" of capitalism. And the bigger you are, the harder you fall. Enron employees who lost their jobs and their 401k nest eggs knew they hadn't signed up for a career in the postal service. And they weren't complaining when the stock price soared from five bucks a share in 1985, to $90 in 2000. Maybe some of the smarter ones cashed in then rather than keeping all their eggs in one basket.

Bad management and bad guessing on oil and gas prices isn't a criminal offense. But cooking the books and insider trading is. An investigation of Enron is warranted. Arthur Anderson, the company's auditors, may also be liable. The giant accounting firm was at best gullible and insufficiently diligent, and at worst complicit in financial deceptions. Art & Andy's subsequent destruction of records doesn't smell very good, either. Enron shareholders who weren't part of the exclusive management club may sue to recover more than $50 million in bonuses generously awarded by Enron executives to themselves on the virtual eve of bankruptcy. What brilliant things, one wonders, did they do to merit such rewards? If any of these people actually broke the law, they ought to go to jail. But that's a legal matter, not a political one.

Mike Rosen's radio show airs daily from 9 a.m. to noon on 850 KOA.

January 18, 2002

-- Maria (maria9470@lycos.com), January 29, 2002

Answers

From Maria's article: "Gore is an "Earth in the Balance" enviro-freak who wanted to impose punitive taxes on energy and scuttle the U.S. economy by ratifying the Kyoto suicide pact. Enron executives may be inept and unethical, but they're not crazy."

My understanding is that Enron executives strongly lobbied Bush to approve the Kyoto Treaty and to impose limits on carbon emissions. Their core business is natural gas, not oil. Kyoto would have forced a lot of coal burning electrical generation plants to be replaced by gas turbine facilities. For Enron that meant a bigger market, all but guaranteed by law.

Enron executives may be inept and unethical, but they're not crazy. Whereas Mike Rosen is just stupid.

-- Little Nipper (canis@minor.net), January 29, 2002.

My understanding is that Enron executives strongly lobbied Bush to approve the Kyoto

Little Nipper, you are correct. But it isn't because of the coal power plants, it is because Enron wanted to be the one to engineer the "trading" of polution cirtificates". Those are the things that they "allow" certain industries to "pollute", those who pollute more will buy cirtuficates from those who pollute less. Enron liked to make money by become "the middle man", an industry and position which had been virually whiped out during the big "downsizing" of business a few decades ago?

-- Cherri (jessam5@home.com), January 29, 2002.

HUH?

-- So (cr@t.es), January 29, 2002.

Maria, You posted an "opinion" of the "spin" the white house is putting out. How about the testamony to congress by the former FERC chairman? (which was reported in newspapers months ago, not as "opinion). How about the SEC statements? They are on record at the SEC? Look them up yourself. You can look up the contributions to the parties, as Enron was going down they "donated" a lot of money to the Democrats...why then? Perhaps hoping they would go easy during investigations? Or in an attempt to muddy the waters over donations to republican's? Or because the Senate had gone to the democrats? (I doubt that as it wasn't done until late last year.

Maria, do you honestly think an opinion piece that parrots the white house retoric (which they brag about putting out) negates the other, mostly documented data? Nuppers, not in the least.

-- Cherri (jessam5@home.com), January 29, 2002.

Thanks for your advice on how to publish articles to this forum Cherri. Too funny! Where's the proof of ties to the Bush administration? So SEC has tied this to Bush? Please show me, I thought I've only been reading your opinion pieces.

LN, please learn how to read the entire paragraph or even the entire sentence which included "Bush pro-business and an oilman;". He was making a comparision of the difference in the parties and the additional contributions to the party leaning more to their business goals ("gave more money to Bush than Gore"). But please continue to add your opinions.

"My understanding is that Enron executives strongly lobbied Bush to approve the Kyoto Treaty" See another reason for NOT instituting campaign finance reform... yet another request not honored by Bush.

-- Maria (anon@ymous.com), January 29, 2002.

The poor Dems resort to guilt-by-association, trying desperately to tie Bush to the Enron debacle. The simple truth is that Enron failed due to it's own mismanagement. Bush did not bail them out.

So where's the beef? Be careful Dems, you risk national MEGO if you continue this carping. To dust-off a few hoary maxims--"this dog won't hunt"; "there is no there there".

-- (lars@indy.net), January 29, 2002.

Of course the Bush Administration didn't bail Enron out. Enron was totally beyond help. So the fact that there was no bailout means nothing.

What means a hell of a lot is the favors Enron got over the years, from bought politicians, both parties.

-- Peter Errington (petere7@starpower.net), January 29, 2002.

Maria, your ignorance is making me chuckle! Lol, too funny! Stop it, you're killing me!

-- (hee-haa@chuckle.-chuckle), January 29, 2002.

"The poor Dems resort to guilt-by-association, trying desperately to tie Bush to the Enron debacle."

Then why is Cheney hiding the truth? There is absolutely NO REASON to conceal the dealings with Enron UNLESS there was something very DISHONEST about those dealings.

-- (Bush And Dick @ criminal. dictators), January 29, 2002.

The only compassionate thing to do is to bail out Enron. Why should their innocent employees and share-holders be stuck holding the bag? An enlightened government would rescue these victims.

There is ample precedent. 20 years ago, Harley Davidson and Chrysler Corp were both bailed out by the Federal gov. Truman (or Ike) bailed out Big Steel. Enron's problem is not that it is in bed with Bush but that it doesn't have employees who belong to powerful unions.

Next to go will be Kmart.

-- (Algernon C. Braithewait III @ Cambridge.MA), January 29, 2002.

"The only compassionate thing to do is to bail out Enron. Why should their innocent employees and share-holders be stuck holding the bag? An enlightened government would rescue these victims."

Bullshit. How is raping taxpayers that were not even involved compassionate? The compassionate thing to do is to hold the criminals responsible, and make them pay their dues. Follow the money, find out who stole it, give it back to the investors, and fry the perpetrators. Now that's compassionate!

-- fry the bastards (starting @ with. "Kenny"), January 29, 2002.

If you have time, read this Blind Faith

Be aware it is 26 pages long and is in PDF ofrmat. But it explains a LOT. It has references to government information to back up what it says.

-- Cherri (jessam5@home.com), January 29, 2002.

Make that 29 pages. It sure tells a lot about how Phill Gramm, and his wife engineered the deregulation of energy and oversight that allowed Enron to do what it has done.

-- Cherri (jessam5@home.com), January 29, 2002.

".....allowed Enron to do what it has done".

What, go broke?

-- (roland@hatemail.com), January 29, 2002.

No, Roland, allowed it to go apeshit for years.

-- Peter Errington (petere7@starpower.net), January 29, 2002.

".....allowed Enron to do what it has done".

What, go broke?

-- (roland@hatemail.com), January 29, 2002."

Enron did not "go broke". Money does not simply disappear. They used illegal so-called "partnerships" to transfer money from the stockholders into the pockets of the top executives.

-- (Dubby and Dicky @ helped. "Kenny Boy"), January 29, 2002.

"Dubby and Dickie" has stated part of the problem, wrt the Enron collapse. In addition, the company constructed an extremely risky house of cards, totally dependent on having share price be much higher than underlying value. The partnerships were designed to conceal the true situation from investors.

-- Peter Errington (petere7@starpower.net), January 29, 2002.

Enron did not "go broke". Money does not simply disappear. They used illegal so-called "partnerships" to transfer money from the stockholders into the pockets of the top executives.

You are lost in the 19th century. You think money is merely a pile of "stuff" that can be locked in a vault? "Money" most certainly can disappear. Everytime a market revalues the price of a commodity, a stock or a piece of real estate, money is created or destroyed. Everytime the Fed reserve adjusts interest rates the supply of money increases or decreases.

-- (Adam Smith @ Econ.101), January 29, 2002.

"(Adam Smith @ Econ.101)"

You are lost in the century of ignorance. What you describe is certainly NOT what happened at Enron. Buy a clue.

-- (ignorance@is.bliss), January 29, 2002.

"To believe that capitalists will behave honorably just because they are engaged in capitalism is akin to believing that no priest will engage in pedophilia simply because he is a priest. Our godfather Adam Smith somewhere remarked that the view of more than two businessmen talking together in a corner justifies the suspicion that they are discussing devices in restraint of trade."

- William F. Buckey from his book, "Give it back."

-- (a_friend@here.now), January 29, 2002.

My major concern has to do with Cheney refusing to turn over the meeting notes from his energy meetings, with Enron being a contributor. Previous administrations, for decades, have done this to dispel any hint of colusion. Why now do they decide not to?

-- SteveOH (thegoofycat@hotmail.com), January 29, 2002.

Steve, if Enron hadn't been a "contributor" to those discussions would anyone care about releasing the notes? Moreover, if Enron hadn't emploded would those discussions have even come up?

-- Carlos (riffraff@cybertime.net), January 29, 2002.

The answer to both questions is no, but that is precisely the point. Since both of those things DID happen, it is critical that we find out what has occurred.

-- (buy@another.clue), January 29, 2002.

Cherri,

an opinion piece that parrots the white house retoric

... as opposed to opinion pieces that parrot the rhetoric from people like Terry McAuliffe and the DNC? Both sides have "data" to back up their positions; it is what they choose to *emphasize* that's the sticking point.

Just for the record, I predicted this, though I certainly didn't know that it would be Enron that would die the most gloriously. When you have stock prices that routinely run at 10-20 times the actual net worth of a company, well, Houston, we have a problem. That's a crash in the making.

(And I said so in 1999. Or, as our old friend CPR once put it: when waitresses at truck stops are talking about stocks, it's time to get out of the market. Like, RIGHT NOW.)

Common stock is basically a loan (the "interest" is paid in the form of dividends, stock splits, etc.); people buy the stock, the company takes that money and uses it to grow and expand ... and to buy its executives nice cars and whores, and to rent politicians.

Moral: that's been going on for as long as stock has been sold. Doesn't make it right, mind you, but you can't ignore that fact. THIS is the point of mentioning that McAuliffe And Co are two-faced hypocrites. They have their sources of soft money (including Global Crossing), the Republicans have theirs.

Keep the politics out of this. Period. What Enron did is what a lot of the DotComs did: they took all that windfall money and spent it like crazy. They could *afford* to absorb huge losses because they were getting so much replacement money from Wall Street. When the stock market collapsed, they grabbed their chests and said, "wuuhhhh ..."

Enron is (at least) guilty of (a) hiding its losses through creative accounting and (b) not permitting its employees to sell their stock when the company started crashing. I predict that at least some Enron executives will do hard time over this, too.

But it's not going to hurt Bush, anymore than the Global Crossing thing is going to hurt McAuliffe. The real answer, once again, is campaign finance reform.

I find myself in the strange position of agreeing with Dick Gephart (a first for me[g]): call your representatives and tell them to vote YES on that very issue when it comes up this spring.

-- Stephen M. Poole (smpoole7@bellsouth.net), January 29, 2002.

Steve OH, why? Why does the discussion on the energy policy matter?

TONY SNOW, HOST, FOX NEWS SUNDAY: Let's switch to Enron. Much in the news. A lot of Democrats and Republicans on Capitol Hill want you to release the names of companies and individuals who participated in the deliberations of your energy task force. Why don't you release the names?

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: Well, there's an important issue here. Tony, you've got a situation in which the president asked me to put together a comprehensive energy policy, the first week we were in office, because there was none. It was vital for our economic and our national security we do that.

So we produced a report. It's a good report. We worked for several months on it. It's got 105 recommendations in it. And we published thousands of copies of it, distributed it all over. The House has now passed its portion of it.

CHENEY: The problem we've had is that Henry Waxman doesn't want to have to deal with the substance of the report, but he's tried to attack the report by challenging the process, by saying we didn't meet with the right people. He's gotten the GAO involved now and demanding...

SNOW: Government Accounting Office.

CHENEY: Government Accounting Office — and demanding that we produce information about how the report was put together.

Now, we've given him an awful lot. We've given him all the financial records, the work that was done by the agency, all of that's gone to the GAO.

What we've not given them, and where the dispute lies, is they've demanded of me that I give Henry Waxman a listing of everybody I meet with, of everything that was discussed, any advice that was received, notes and minutes of those meetings.

Now, that would be unprecedented in the sense that that's not been done before. It's unprecedented in the sense that it would make it virtually impossible for me to have confidential conversations with anybody.

It, in effect, says that I, and future vice presidents, would be in a position where any time Henry Waxman or any other member of Congress wants to demand of me information about the meetings I hold, I'd have to give it to them. The lawyers in the executive branch are convinced this is a fundamentally bad idea.

SNOW: So you'll go to court over this?

CHENEY: As of last August, we've made that decision to go to court. We'd come to an ultimate showdown, and we've concluded that, in fact, we were prepared to go to court if that's what was necessary. At that point, the GAO backed off, and they, in effect, sort of put everything in abeyance.

Now what's happened is we've come back around, as a result of the Enron corporate collapse, some of the Democrats on the Hill are trying to re-energize this and try to turn it into some kind of political debate with respect to Enron.

But what's really at stake here is the ability of the president and the vice president to solicit advice from anybody they want in confidence, get good, solid, unvarnished advice without having to make it available to a member of Congress. The GAO does not have the authority to get into that particular arena. It has a...

SNOW: Is there any circumstance — you talked before about compromises, that there may be...

CHENEY: Well, I think we have compromised. We've given them a great deal of information. We have not given them those things that we believe that I have to have — I have to have the ability to talk to people in confidence if I'm going to effectively advise the president.

SNOW: So you will not give them anything more?

CHENEY: That's correct.

SNOW: No more compromises?

CHENEY: That's correct.

SNOW: David Walker, the comptroller general, said just yesterday: "We've never had any situation where we were absolutely stonewalled by a task force of this type. The law in past precedence says that Congress has a right to this information and can use the GAO to conduct a non-partisan review."

CHENEY: No, that's where the dispute lies, because the GAO is a creature of the Congress, created by statute. Their jurisdiction extends to agencies created by statute. That's not me. I'm, as part of the office of the president and the vice president of the United States, I'm a constitutional officer. And the authority of the GAO does not extend in that case to my office.

Now, I've been around town for 34 years, Tony. I've seen a constant, steady erosion of the power and the ability of the president to do his job. We've seen the War Powers Act and Anheim (ph) Powerment (ph) Control Act.

And time after time after time, administrations have traded away the authority of the president to do his job. We're not going to do that in this administration.

The president's bound and determined to defend those principles and to pass on this office, his and mine, to future generations in better shape then we found it.

And for us to compromise on this basic fundamental principle would in effect do that. It would further weaken the presidency, and we don't want to do that.

SNOW: Mr. Vice President, we're going to take a break.

But stay with us. We'll have a lot more on Enron, the economy and much more in just a couple of minutes.

(COMMERCIAL BREAK)

SNOW: We're back with Vice President Dick Cheney. Also here, Brit Hume, Washington managing editor of Fox News.

Brit?

BRIT HUME, FOX NEWS: Two questions, Mr. Vice President, on this Enron and the GAO. Are there any circumstances under which a release of this information to the members of Congress, informally, to a committee, not the GAO, would be possible?

CHENEY: Well, there's, you know, there's no secret about what we did with respect to the task force. We talked to all kinds of people. I talked to energy companies, I talked to labor members, talked to environmentalists. Other members talked to a wide variety of people, and folks came in and discussed with us and gave us advice and recommendations. Some of them went out and made public what they did. That's fine. That's their business.

What I object to, and what the president's objected to, and what we've told the GAO we won't do, is make it impossible for me or future vice presidents to ever have a conversation in confidence with anybody without having, ultimately, to tell a member of Congress what we talked about and what was said.

You just cannot accept that proposition without putting a chill over the ability of the president and vice president to receive unvarnished advice.

HUME: Having taken that position, clearly you believe at law you will be able to sustain it.

CHENEY: We do.

HUME: A political question, and that is, whatever your motives and whatever the underlying reality, it is going to look as if, in the midst of the collapse of Enron and the attendant scandal, that the administration has something it doesn't want to tell, something it wants to hide.

Are you and the president prepared to endure what you know are going to be the political difficulties that that position will lead to, in order to vindicate this principle?

CHENEY: The issue here isn't, with respect to Enron, isn't what advice they may have offered the energy task force. The issue, with respect to Enron, is the corporate collapse. It's what happened when, for whatever reason, laws were broken, maybe the laws were flawed, maybe the accounting system was flawed, we'll find out, we don't know yet. But that's the political issue, with respect to Enron, as how that's handled.

HUME: I didn't say it would be fair. I just said you would receive it.

CHENEY: That's how it'll be managed. And what's happened there, of course, is the president's insisted on a full and complete investigation. We're going to make absolutely certain, if there are guilty parties there, if laws were broken, there's full prosecution under the law. We've got a pension reform 401(k) task force already working to look for ways to improve that.

We'll do whatever's necessary legally and, from a statutory and regulatory standpoint, to make sure that doesn't happen.

But if you go back to August, and the judgment in August was that it was important to protect this principle of our ability to seek advice on a confidential basis, and that that was legally sound and historically and constitutionally important, the collapse of Enron doesn't change that.

Why would you say, well, Enron collapsed, therefore, you ought to give up a basic fundamental principle of the presidency? It doesn't track.

HUME: It isn't logical, but there it is.

CHENEY: Well, but...

HUME: And I just wonder whether, if there are political costs — and there may be — are you saying here that you and the president are prepared to bear them?

CHENEY: I'm saying, again, reiterate once again, we feel very strongly that this is an important proposition.

And after all of these years, I think back over history, can you imagine an FDR or Teddy Roosevelt, in the midst of a grave national crisis, dealing with the problems we're having to deal with now, over here on the side as a matter of political expediency, trading away a very important fundamental principle of the presidency? That's not how you make a great presidents.

And I think from the standpoint of this basic proposition, we are right — I think people know we're right — and we'll do everything we can to sustain that position.

SNOW: You held up the energy plan before. Is there anything in that energy plan that was done specifically for or at the behest of Enron?

CHENEY: I can't say. I'm sure they supported many parts of it.

We talked to them about their role. They were the world's leading energy trader. At the time that they were involved, they were heavily engaged in this whole process of trading energy. It was a whole new development with respect to the way the markets worked, and they had good advice to offer in terms of how you dealt with that situation.

SNOW: So you don't agree with...

CHENEY: I can't say a particular proposal came from them. They advocated, for example, or opposed price controls on energy. But guess what? I've been opposed to price controls since I worked in Nixon's control program 30 years ago. So, my own views in 20 some years worth of experience are heavily involved there.

But I'm sure, you know, as I talked to a whole wide range of people, we gathered up information and advice and we put in there.

Ultimately, we should be judged based on what we put in the report. That's what I recommended. That's what the task force recommended to the president. And we benefited from talking with a wide variety of people in putting that report together.

SNOW: Well, Tom White, the army secretary, used to run something called Enron Energy Services. It is now being reported that was one of the spinoffs in which Enron was concealing its losses from investors. If that is the case, and if he knew about it, would you expect him to step down?

CHENEY: Well, I don't have any detailed information about what was going on inside Enron, obviously.

I know Tom White, and Tom White was a great soldier. He's a man who worked as Colin Powell's exec on my watch in the Pentagon. We are extraordinarily fortunate to get him to give up his private life and return to public service as secretary of the Army. And I'm got every confidence he handled himself in an ethically appropriate manner.

-- Maria (anon@ymous.com), January 30, 2002.

Maria,

The reason I would like to see him release the information is only because the insinuation (sp?) has been leveled that there has been a quid pro quo between the donations and the eneregy policies that Enron had ties to. I think that if he does have the law on his side, and proved in court, that I have no problem with it. However, just because he says he didn't have sex with that -- oh wait - wrong administration - he says there was no favors passed, how do we know? Personally, I could care less what went on during those energy meetings as I am a minority that feels the gubmint does NOT need to tell me eveything that is going on, but you have to admit that Whitewater - er I mean - Enron IS a big deal to many a people. But this is something for the courts to decide, not you or me.

-- SteveOH (thegoofycat@hotmail.com), January 30, 2002.

Common stock is basically a loan (the "interest" is paid in the form of dividends, stock splits, etc.); people buy the stock, the company takes that money and uses it to grow and expand ... and to buy its executives nice cars and whores, and to rent politicians.

Stephen, I could not disagree more. Common stock is not a "loan". Loans are obtained from banks. Banks want equity; banks want a degree of certainty (an enterprise that has earnings) before they loan money. Banks want contracts that specify repayment at a certain time and amount. If entrepreneurs had to rely on debt financing (ie, banks) to start-up their enterprises, there would be no start-ups.

Common stock is equity financing. Common stock represents partial ownership in the enterprise and all the risk and rewards associated with that ownership. If you buy newly issued stock directly from the enterprise (or from its underwriter), then you are in investor in the enterprise. If the enterprise is successful, then you are may make a profit because the market value of the stock has risen from its IPO price. You may also derive an income stream from dividends, but as an owner (rather than lender), you are not legally entitled to any return.

If at a much later date, you buy the common shares in a market of stocks, you are buying them at the price that the market negotiates. The company itself receives no money from purchases made on an open market. The negotiation is between two consenting adults (or mutual funds or pension funds). The greater fool who paid $60/share for Enron in March 2001(me) bought it from another greater fool who paid $40/share it. He hoped to sell it to another greater fool for $80/sh. The Enron Corp never received any money from this transaction. Whoever buys the originally issued shares of the corporation is making an investment. Whoever buys later, on a market, makes a speculalation. But if the promise of such speculation was not present from the very beginning, the original shares would probably never have sold. In the beginning there were no earnings from which to pay dividends, there was only the bellief (hope) that the innovative product or service would hit a home run and therefore appreciate in price (a price set by a free market).

I believe that in a free society there should be the freedom to be a greater fool. There should be the freedom for a little known corporation in Rochester NY in the early 50s to solicit equity financing from the public even though Arthur D. Little Co had estimated there was only a national market for 6000 of their gizmos. Their gizmo was of course the Xerox machine.

-- (lars@indy.net), January 30, 2002.

Stephen, I apologize for sounding didactic. I dislike people who lecture, especially myself.

But you did say "common stock is basically a loan....". Sheesh, what were you thinking?

Also, in my last paragraph, Arthur D Little was the consulting company retained by Haloid (later Xerox) to evaluate the hitherto unknown Xerox technology. Good thing Xerox ignored their "wisdom" and sallied forth.

Imagine the same process of decision making in a top-down economy. Even if some nerd had the courage to bring up his whacky new idea to the commissar, chances are it would be ignored or buried in a committee. There is no incentive for the CYA types to rock the boat.

-- (lars@indy.net), January 31, 2002.

Lars, common stock viewed as a loan is an analogy that holds water in some situations (e.g. during the IPO phase).

-- Peter Errington (petere7@starpower.net), January 31, 2002.

Lars,

We both oversimplified. You're talking about the state of a stock *after* the company has issued it. Yes, at the point, people *are* trading already-existent pieces of paper for money.

But when that stock is initially issued, it is indeed a loan: you are *investing* directly into that company. That's the whole reason why they issued the stock in the first place! From time to time, they will issue additional stock, too -- and that also smells just like a loan. They're telling the public, "we needs mo' money - buy this NEW stock!"

The most incorrect statement that I made was that the "interest" was paid in the form of "dividends, etc." On reflection, that went beyond simplification into outright error, and I stand corrected.

For those who care, a bunch of college students maintain a page that discusses how the stock market works here.

-- Stephen M. Poole (smpoole7@bellsouth.net), January 31, 2002.

Lars,

Well, doggone it, I surrender. I hit "submit" before I realized that I'd cut out an entire sentence comparing the form of "loan" to a bond (which can be sold and traded).

Anyone who's bought a house or car in the past 20 years is only too aware that loans can be traded and sold, too -- the mortgage on my parent's house was swapped twice before they paid it off. The final company holding their paper wasn't even in the same state.

But that's an oversimplification, too. So ... anyone who cares a flip can click that link to get a nice overview. :)

Don't apologize for being a stickler, by the way. My oversimplification could get someone into trouble.

-- Stephen M. Poole (smpoole7@bellsouth.net), January 31, 2002.

I guess I should enter the fray, eh?

Michael Moore's thoughts on all this.

If he's a communist or something equivalent, I don't even care. His thoughts sound about right to me.

-- Anita (Anita_S3@hotmail.com), January 31, 2002.

SteveOH, I agree with a lot of what you say but I still don't see reasons for forcing this issue. Yeah it may look like something happened behind closed doors but what's fishy about it? I don't think there's a quid pro quo here, certainly not on the magnitude of the Rich pardon. I believe that the ideas put forth from Enron were, for the most part, close to Chaney's own opinions based on his own experience in the oil industry. Nothing unusual there. Two people working in the same industry having the same ideas seems pretty natural to me; they also had differences of opinion. Again nothing unusual in my eyes. What's the quid pro quo here that you feel compelled to force this into the courts? Sorry, I'm just trying to understand a connection when to me there doesn't seem to be any - kinda like the 'interconnectedness' of Y2K.

-- Maria (anon@ymous.com), February 01, 2002.

Michael Moore is not a Communist. He hasn't the balls to be a Communist; he hasn't the guts to get his hands dirty. He is a gadfly, a lightweight, a buffoon who makes his living by pimping the very system he pretends to detest.

In the USSR he would have received a free vacation to Siberia where his fat parasitic ass would have lasted 3 months.

-- (Leon Trotsky@Gulag.guffawing), February 01, 2002.

"Michael Moore is not a Communist. He hasn't the balls to be a Communist; he hasn't the guts to get his hands dirty. He is a gadfly, a lightweight, a buffoon who makes his living by pimping the very system he pretends to detest.

In the USSR he would have received a free vacation to Siberia where his fat parasitic ass would have lasted 3 months.

-- (Leon Trotsky@Gulag.guffawing), February 01, 2002."

LOL! Don't hold back, tell us what you REALLY think!

Methinks his letter to Bush is much too true for you to dispute, so you attack the messenger instead. Dubya is the one who you should be disappointed with, but you love him too much to face reality.

-- lol (your bi-ass @ is. showing), February 01, 2002.

Michael Moore is a dilettant radical-chic phoney. If he really cared about the working class, he would stay in Flint and work with the white-ethnics, southern white trailer-trashes and African-Americans who carried their lunch boxes every day for years to toil on the now idle assembly lines at Buick and AC Spark Plug.

-- (Leon Trotsky@off.the pigs), February 01, 2002.