novelweb Six hundred and thirtieth chapters Enron incident
Six hundred and thirtieth chapters Enron incident
The so-called material written by Li Weidong is still some after-the-fact analysis of Enron.
The post-event summary is naturally much more accurate than the pre-prediction, and it is also more justified. So when Situ Jian saw the information provided by Li Weidong, he immediately believed it by 50%.
In addition, Li Weidong had accurately predicted Japan's economic bubble and the Asian financial crisis, and even the entire incident was accurate, which made Situ Jian believe in Li Weidong's prediction this time. Sixty to seventy percent.
As a top economist, being able to believe 60% to 70% is almost equivalent to believing in Li Weidong's judgment.
In 2001, the world-shocking 911 Incident occurred in the United States, which directly changed the world pattern.
What Americans did not expect was that, more than a month after the September 11 Incident, the scandal of Enron's falsified accounts broke out.
At that time, Enron was one of the top ten companies in the United States and the largest natural gas company in the world. Given the size and status of Enron, this is undoubtedly the September 11 incident in the economic world for the United States, and the collapse of Enron has also changed the world's energy landscape.
Moreover, Enron filed for bankruptcy in just 25 days after it was exposed that there were problems. This is also very rare.
The larger the company, the stronger the ability to resist risks. Enron's scale ranks among the top ten in the United States and the top twenty in the world's top 500 companies, but it only lasted for a short period of 25 days!
Many Japanese companies that are not as large as Enron have also experienced various fraud scandals. Some have falsified production data, and some, like Enron, have falsified business data. It's okay, there are only a handful of real bankruptcy.
Some world-renowned large enterprises have faced serious debt crises, but they only need to tighten their belts to increase income and reduce expenditure, or sell some assets, and they can survive.
There are also some top-level large companies. When encountering a crisis, the government will step in to help with asset restructuring, or provide funds for partial nationalization to save the company.
There are precedents for these, including in the United States. For example, the US government sold General Motors, Citibank, Freddie Mac and Fannie Mae, all of which included some means of nationalization.
However, Enron didn't apologize and settle the matter, secondly, it didn't tighten its belt to increase income and reduce expenditure, and thirdly, it didn't get help from the government, so it went bankrupt abruptly. For a company of this size, it is absolutely unbelievable.
Therefore, there have always been some conspiracy theories about the bankruptcy of Enron, who believed that someone deliberately let Enron go bankrupt.
With such a large scale, Enron went bankrupt because of more than one reason, but a combination of many bad factors, which eventually led to the bankruptcy of Enron.
Rome was not built in a day, and these unhealthy factors were not built in a day or two, but after decades of fermentation, the accumulation of small diseases became serious diseases, and finally there was no cure.
There were two oil crises in the 1970s, one was the Fourth Middle East War in 1973. Although the United States did not directly participate in this time and sold a wave of weapons, the oil crisis that broke out caused the industrial production of the United States to drop by 14%.
The second time was the political coup in Iran in 1978. This time, the United States was a direct participant and caused even greater damage to American industrial production.
Therefore, throughout the 1970s, the United States implemented energy price controls to ensure the stable operation of industries.
In the 1980s, the United States abolished the control of energy prices, and then the energy prices in the United States began to be adjusted according to the market, which prompted competition among energy companies.
Immediately afterwards, this competition created mergers and reorganizations among enterprises,
It was also during this period that Enron transformed from a company laying natural gas pipelines into a real energy company.
However, for Americans, how can it be easier to get money from playing finance to start a business in a down-to-earth manner?
How can you make money by hedging natural gas in the production of natural gas?
So Enron Capital was established, and soon replaced Enron Natural Gas as the most important industry under Enron. This is also the first step on Enron's road to bankruptcy.
In order to be able to thrive in the financial market, more investors of Schina, Enron's CEO Kenneth, spent a lot of effort to persuade the US Securities Commission to agree to Enron's mark-to-market pricing.
Natural gas is not easy to store for a long time, so natural gas is basically sold on the spot, and everyone uses fresh natural gas.
You go to a restaurant to eat, there may be 82 Lafite, there may be 82 ham, there may be 82 cook, but you will never cook with 82 natural gas, because the natural gas cannot be stored for that long.
The less easily stored a commodity is, the more volatile its price will be. Products that cannot be stored mean one price per day, so natural gas, as a commodity, can only be priced in real time, and cannot be priced by the market.
The same is true for natural gas contracts signed internationally. The signed contract is only an estimated price, but when the contract is completed, it must be priced in real time. At most, it is to set upper and lower limits for a transaction amount.
There is a futures market for bulk commodities, such as oil trading. The contract is 100 US dollars a barrel, but later the international market price dropped to 30 US dollars a barrel, and I still buy it according to the contract of 100 US dollars a barrel. This is absolutely wrong. possible.
Leaving aside the aspect of profit and loss, if you dare to trade like this, the futures market will be messed up first, and OPEC dares to kill you with a knife!
Unless it is some special circumstances, such as international sanctions, financial sanctions, etc., which hinder the seller's transaction, or implement some local currency exchange agreements, similar to this kind of transaction that is outside the normal international system, you can buy bulk items at a relatively low price Otherwise, in normal international transactions, it is difficult to buy products that are far from real-time pricing.
Enron's price-to-market pricing for natural gas clearly violates the educational principles of natural gas.
And this means that Enron can record the profits of transactions completed in the next few years according to its estimated transaction volume in one day.
In other words, when the price of natural gas is relatively high, Enron can settle the transaction amount that has not been completed in the contract, and there will be more profits on the book, but in fact he has not made so much money .
It's like earning one thousand a day does not mean earning thirty thousand a month, nor does it mean earning three hundred and sixty thousand a year. But if you use the day that makes the most money to calculate your annual income, the data is definitely not true.
Enron used this method to falsely report its profits, which caused investors to pour in. Enron also took a tougher step on the road to bankruptcy.
Making a gas company mark-to-market is pretty crazy policy in itself.
There are many first-class economists in the U.S. Securities Commission, and there is no shortage of staff who study the economy around the U.S. Congressmen. It is impossible for them to fail to see what impact this policy will bring.
However, no one from Congress to the Securities Commission stopped this crazy move, which also shows how powerful political funding and corporate lobbying are in the United States.
Even if they started falsely reporting profits, Enron was still not satisfied, and they still felt that making money was too slow!
I am an Enron company, how many natural gas contracts can I sign, and how much profit can I falsely report?
If he could control the natural gas transactions across the United States, wouldn't his earnings be multiplied by dozens of times!
So Enron began to act as a middleman for natural gas, but the middleman earned more than just the difference.
As a natural gas intermediary, Enron has also used its market-based pricing method in natural gas transactions. This is tantamount to borrowing chickens to lay eggs.
Seeing Enron's strong profitability, investors also flocked to it. Chase, Goldman Sachs, Citigroup, Deutsche Bank, etc., almost all investment banks hold Enron's stocks and bonds on a large scale.
Many Americans regard Enron as a capital-guaranteed wealth management product, and invest their salaries and pensions in Enron stocks.
However, Enron is a listed company after all, and its financial reports must be made public on a regular basis, so it is easy to find false profits in the accounts.
So An Ran used another trick, they used the special purpose entity (SPE) method.
A special purpose entity is a legal entity established for a special purpose. It is a financial service business that emerged in the 1970s and 1980s in the United States. Its purpose is mainly to isolate financial risks in financing.
To put it simply, it is to set up a separate company, spin off one of its own assets, and then issue bonds with the company's assets as collateral, so as to raise funds. This is similar to the principle of spin-off and listing of enterprises.
Using this method greatly reduces the threshold for corporate financing, and can also better control risks. Therefore, in the financial field, special purpose entities are known as the greatest financial innovation of the 20th century.
Enterprises use special purpose entities to divest assets to facilitate financing.
Enron, on the other hand, did the opposite. They spun off the debt so that the special purpose entity could be independent of the original company's financial report. Therefore, Enron's financial reports are always beautiful, and investors have always been full of confidence in Enron.
Among them, the help of Andersen Accounting Firm is indispensable.
As one of the top five accounting firms in the United States, Andersen has been serving Enron. Without the help of Andersen, Enron would not have such outstanding profits.
All of the above are related to Enron’s financial fraud. In addition, investment power, blind expansion, management corruption, etc., are also the reasons for Enron’s collapse.
In the final analysis, there are still two words, that is greedy!
Two days later, Situ Jian took Li Weidong to the State Planning Commission, the predecessor of the National Development and Reform Commission.
Director Wang, who we are going to meet in a while, is the leader of the leading group of the Engineering Construction Committee. Situ Jian introduced.
Li Weidong nodded. He had also heard of Director Wang's name.
Director Wang is a master of mechanical engineering, a senior engineer, and a typical technical official. In the future, he will serve as a deputy in the National Development and Reform Commission and be in charge of energy affairs.
It is actually a more pleasant thing for such a technical official to report to work, because people can understand what you say, and it is easier to communicate.
Director Wang didn't have much time to read the materials in detail, so Li Weidong explained from the side.
After listening to Li Weidong's introduction, Director Wang asked, Chairman Li, according to your statement, will Enron's stocks and bonds be thundered?
It's not just a thunderstorm, the entire Enron Company may go bankrupt! Li Weidong replied.
Director Wang took a deep breath, and his expression suddenly became solemn. If someone else said that, Director Wang might scoff, but if Li Weidong said that, it would be completely different.
Director Wang knew that Li Weidong had predicted the Asian financial crisis and the Japanese economic bubble, so he believed Li Weidong's prediction to a certain extent.
If Enron really goes bankrupt, then Huafu Gas will not be able to continue to receive technical support from Enron. At that time, the part of the project that Huafu Gas will be responsible for will also be shut down, and the construction of the entire West-to-East Gas Pipeline Project will not be completed. will be affected.
After pondering for a while, Director Wang said: Chairman Li, your analysis is indeed well-founded, but it is only an analysis after all. What I need is some more definite evidence.
For such a large project at the national strategic level, it is obvious that a decision cannot be made based on a seemingly well-founded analysis.
Li Weidong replied: In the United States, I have asked a financial reporter to conduct an investigation. It is estimated that the results will be available in half a month. Before that, I hope to delay the signing with Huafu Gas as much as possible to avoid major incidents. Loss.
It seems that Chairman Li is on the coast of the United States and has quite a lot of connections. He can actually investigate a big company like Enron. Director Wang said with a smile.
Li Weidong knew that Director Wang was trying to test it out, and he had to explain it clearly.
So Li Weidong said: A big company like Enron has many eyes on it, and there are countless reporters who want to dig up black information about Enron and become famous.
Moreover, Enron has many competitors, and they all hope that Enron will collapse, and they will also send people to secretly investigate the situation of Enron.
So I don't need to hire a special person, I just need to disclose the direction of the investigation to those financial reporters, and give them some sponsorship fees by the way, so that they can verify the data.
So that's it! Director Wang nodded: However, half a month may be difficult. I still have to ensure the progress of the project, so I can buy you a week at most.
That's okay! Li Weidong paused, and then continued; Anyway, before the official start of construction, some measurement and calculation work is still needed. As long as the construction has not started, everything will be in time.
Huafu Gas, general manager Lin Mancang is sitting in the office, waiting for news.
Finally, the phone rang, and Lin Mancang answered the phone: Did you find it? Why did you delay signing the contract for a week at the engineering construction leadership office?
The reason given by the engineering construction office is that there are still some procedures to go through, but this is only a nominal reason. In fact, someone came to lobby. The phone answered.
Who is it? Lin Mancang asked.
Li Weidong, Chairman of Puppy Electric. The other party replied.
Li Weidong? What does this matter have to do with him? Puppy Electric is not in the natural gas business. Also, he is a private owner, how can he have such a big face that even the engineering construction office will listen to him? Lin Mancang was puzzled asked.
It is said that it is because Li Weidong successfully predicted the Japanese economic bubble and the Asian financial crisis before, and he personally reported the work to the leader. Therefore, the engineering construction office will seriously consider Li Weidong's suggestion. The other party said replied.
But I didn't offend this Li Weidong! Why did he bother us? Lin Mancang said puzzled.
I think it's because of Huanghai Petrochemical. Huanghai Petrochemical has been supplying raw materials to Xiaogou Electric. The cooperation between them has been for almost ten years! This time Huanghai Petrochemical failed to win this project. Li Weidong should help Huanghai Petrochemical shot. The other party replied.
Hmph! They Huanghai Petrochemical couldn't get this project because their technology was backward! The technology is not as good as the people, so they didn't hurry to improve it, but they used shady tricks behind their backs. It's really despicable!
Lin Mancang snorted coldly, and then asked, Do you know what kind of slander Li Weidong and the Engineering Construction Office have made?
Li Weidong said that there is a problem with Enron's financial report. They are likely to experience thunderstorms or even close down. At that time, they will not be able to provide us with technical support, and the project we are responsible for will not be able to continue. The phone answered .
Enron will go bankrupt? Hahaha, what are you kidding? He is a Fortune 500 company and the largest natural gas company in the world! How could it go bankrupt! The engineering and construction office would believe such deceitful nonsense! Lin Mancang was furious Humming said.
The main reason is that Li Weidong's previous predictions were too accurate. He answered on the phone.
Then you can't make decisions based on predictions! If the predictions work, then just find a fortune teller to build a natural gas pipeline! I really don't ask the common people and ask the ghosts and gods! Lin Mancang said angrily.
Boss Lin, what should we do then? Do we have to wait a week? He asked on the phone.
This time there is an excuse to delay for a week, and next time there will be an excuse to delay for two weeks, maybe it will be delayed for a month in the future! Lin Mancang took a deep breath and continued; I am now reporting to the group, let The group puts pressure on us!
Huanghai Petrochemical, Song Jinlong is holding a decision-making meeting again.
Dong Song, this Li Weidong is really unreliable. He even said he could help us get the project back. What happened? Today is the signing day for Huafu Gas!
Yeah, back then I made such a big deal about it, and I wanted to shut down Enron, making it look like I could do anything! But now I can't do anything!
Dong Song, we shouldn't have trusted this Li Weidong at the time. These private companies, nine out of ten are cheating!
That Li Weidong still wants our New Oriental Electric, he probably has no face to contact us now! If I were that Li Weidong, I would like to find a crack in the ground and get in.
Song Jinlong's face was also very embarrassed. After all, he was the first person to believe in Li Weidong. Although his subordinates are now saying that Li Weidong is wrong, they are also mocking Song Jinlong in disguise, and Song Jinlong also feels very embarrassed.
At this moment, the secretary came in, leaned into Song Jinlong's ear, and said, Dong Song, Li Weidong from Puppy Electric is calling.
Li Weidong still has the nerve to call? Song Jinlong looked upset, and then said: If you don't answer, just say I'm in a meeting, and I'm very busy now.
I guess he wants to apologize! Director Song, I think it's better to give him a chance to apologize! The oldest old Du next to him showed a gloating expression while talking.
Lao Du is relying on the old to sell the old, and he made it clear that he wanted to see a joke.
This is not only Li Weidong's joke, but also Song Jinlong's joke!
Song Jinlong couldn't get off the stage, so he said, Put the phone in the meeting room, and turn on the speakerphone. I want to see what Li Weidong has to say!
Soon, the phone was answered, and the speaker was turned on, so that everyone in the conference room could hear it.
Li Weidong's voice came from the phone: Chairman Song, have you read the latest issue of Fortune?
What Fortune magazine? Song Jinlong asked subconsciously.
It's the Fortune magazine in the United States. It is the most famous financial magazine in the world. It is the magazine that produces the world's top 500 companies. Li Weidong explained.
Didn't look at it. Song Jinlong continued coldly: We are not the top 500 in the world, let's see what that thing does!
But Enron is one of the top 500 companies in the world! Li Weidong chuckled, and continued, Dong Song, hurry up and find a copy of the latest Fortune magazine, there is an article about Enron on it. Read it You will know later, I have been doing things these days!
The parent company of Huafu Gas is Huafu Group, which is one of the top state-owned holding companies in China.
Lin Mancang asked Huafu Group for help, Huafu Group decisively helped, and the engineering construction office could only complete the contract with Huafu Gas.
At the scene of the signing ceremony, the contract was already in front of them, all they had to do was sign it.
Lin Mancang took the signing pen from his subordinates with a proud face, signed his name on the contract, and then printed the official seal on it.
Immediately afterwards, he handed the contract to Director Wang, and it was time for Director Wang to sign and seal it.
The moment Director Wang picked up the pen, a secretary from the Engineering Construction Office hurried in.
However, another staff member stopped the secretary: Director Wang is signing a contract, what's the matter, we'll talk about it later!
No, after all, report this matter to Director Wang immediately! The secretary pointed to the Fortune magazine in his hand, and then said: An accident happened to Enron Corporation in the United States!
No pop-up window, timely update!