ENRON

i think i posted some of my observations concerning ENRON some months, years ago.

but in light of the trial verdict, i thought that i would reprise some of the salient aspects of my previous essays.

i had this stockbroker who was very close to the lays. in fact, he and ken's sister, sharon, purchased land together to build their houston dream houses.

he kept encouraging me to buy enron stock. i kept telling him no. finally, one day over lunch in 2000-2001, he really put the arm on me to buy enron. i told him no again. he was so flabbergasted that i would not invest in that company that he challenged me to tell him why i was so opposed to owning enron gilts.

this is what i told him......

1. i worked with the natural gas pipeline companies[northern natural gas, houston pipeline, florida gas] prior to their acquisition by ken lay.

prior to their acquisition by ken lay, these were well-run, well-managed, safety-conscious entities.

after their acquisiton by the ken lay vehicle, enron, all these entities became "raped".

no training of personnel. no sufficiency of personnel.

a national security asset of the usa was being sabotaged, in my view.

2. that view was sharpened by how ken lay re-organized these entities. after merging into enron, they no longer operated in an authoritarian manner. these national security assets became operated by consensus - where the ignorant lowest level mechanic had equal standing with the 30 year supervisor who really knew things.

3. and then there was the enron effort to compel metallurgical labs to fudge analyses. about such critical aspects of their assets as the integrity of their line pipe, their cathodic protection, their welding quality.

i could say so much more. but i shall leave it this way. prior to enron, the natural gas pipeline industry tried to do it honestly, responsibly. enron changed that. after all the other pipeline companies noted the enron "trimming" they all became "trimmers". bad money driving out the good. this is a reagan/clinnton/bushit phenomenon.

4. in 1993, i was invited to russia by gazprom to survey some of their critical pipeline equipment. when i say critical, i mean it this way...if it doesn't work, moscow freezes in the dark.

sometime after my survey, enron took a contract to operate the gas transmission assests of gazprom. coincidentally, they exercised an agreement with argentina to operate their natural gas pipeline assets[gas del estado].

i know that they failed in both ventures. the gazprom project was such a failure. enron hadn't a clue.

for some reason, enron had failed to recognize the control of the mafiyah.

i recall the meeting at enron hq to this day. they were complaining that materials that i supplied them were stuck on the docks of riga. as if this was my problem.

i advised them that the problem didn't originate with me or my outfit...that the problem was theirs. i told them that i suspected that all their materials for their projects were blockaded at riga. much enron stammering. this told me that i had it accurately.

so i went further, i told them that they had failed to recognize the influence of the mafiyah. more stammering. meeting ended.

walking out to the elevator, one of the enron hands took me aside and told me that i had it accurately...but that these were truths that the management of enron would never recognize.

i responded that enron would lose lots of money in these ventures.

some months later, enron abandoned these projects.

these abandonments occurred without much comment in the financial press.

for a later date, i shall discuss enron's energy trading business. suffice it to say, it was a ponzi scheme.

and it was so clearly that. so consider your monies subjected to the wall street gangsters. the gangsters who preferred to look the other way.

scythes and pitchforks, amigos.

burn dc.