Spotlight customer reviews:
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Customer Rating:  
Summary: Must read - but was it all that obvious?
Comment: Agree with previous reviews of this book and no doubt: must read before you do any more investments. Very well researched and exciting read. Describes things they don't teach you on MBA/CFA etc. Looking forward to a similar book on credit crunch!
Have to say though, I'm about half-way through the book (sorry if it changes) but what's a bit disturbing is that all written from "it was all so obvious why didn't everybody see this coming" retrospective perspective. Fair enough, the authors wrote the article "Is Enron overvalued" but did they predict bankruptcy? Did they know about all the accounting tricks before the post-bankruptcy analysis became available? I doubt it. We're all smarter after the fact!
Nevertheless, must read!
Customer Rating:
Summary: The Crooked E
Comment: This book is about a reality so different from my own, I use it as escapism. Although the transactions described are Byzantine, the book nevertheless holds the reader's attention for over 400 pp. Events are presented roughly chronologically; the characters and information accrue like an approaching balloon note; some questions are answered only after the reader has had time to stew. Tension mounts as the house of cards gets impossibly higher!
Customer Rating:
Summary: Lehman brothers: Chapt 11
Comment: Actually read this a few months back but thought I'd pen this short review on the day Lehman brothers filed for Chapt 11, Merril Lynch bought for a bargain by BOA, and AIG "restructuring" (ie throwing everything it can overboard). But, I hear you cry, what does Enron have to do with merchant banks? Well if you read this excellent book, you'll find that by the end of its existence Enron was essentially a merchant bank. It traded risk (and made some handsome profits doing so). The original hard infrastructure (real things that make real money in real, steady time) based pipeline and energy distribution business having being stripped, sold or just neglected. It wasn't the byzantine, dishonest finest pyramids, that really led to the fall, although they greatly speeded it up. It was the out of control trading floors. Live by the sword, die by the sword. Making your core business the trading of risk, is, well, a risky business. Add to this a complete lack of any moral compass, plus the attitude that you are always smarter than the other guy and this is what you get in the end - a dime sale of your computers, carpets and inspiring front lobby art.
Customer Rating:
Summary: Advanced accounting shenanigans don't create value
Comment: Very well researched account of the rise and downfall of Enron. It chronicles the start and the ultimate demise of this company, which never really had a great business model - (sorry Jeff Skilling). It is amazing that so many "smart" people did not understand basic business skills and the simple difference between economic and accounting gains. Jeff Skilling, a former McKinsey partner, should have stayed with the consulting firm where theory is safely differentiated from real world. Skillings' first mistake was not understanding his own limitations first and foremost. He breaks out a bottle of champagne to celebrate SEC's acceptance of a change in Enron's accounting system. Accounting does not create value - it does not appear that many Enron executives (especially Skillings who should have known better) understood this.
McLean and Elkind do a nice job presenting some of the schemes and scams that Enron executives used to make themselves look good to investors, analysts, bankers and the general public. There are some scams that I had a hard time following, but the reader will grasp the general idea behind them. In light of recent accounting scandals, this is an important book to read for any investors and the public in general. Unfortunately the book ends around summer of 2002 and we do not find out what happens to some of the key characters. My interest was sparked enough that I researched some of the more recent findings after reading the book. Despite its difficulty to read at times I highly recommend it.
Customer Rating:
Summary: Corporate arrogance gone amok
Comment: When one reads 'The Smartest Guys In The Room' there is one question that keeps recurring. How did no-one at Enron foresee the company's grizzly demise. The folly of mark to market accounting was reason enoough to expect certain problems, but the endless treadmill that Enron placed itself on concerning the stock price made those problems an inevitability.
Although Elkind and Mclean portray the story well, they really don't have to do much with the material to make a fantastic story of the blistering story with which Enron rose and the calamitous pace at which it fell. The Enron tale is one of brash arrogance in almost every possible facet of a business, allied to a stubborn refusal to accept the economic reality even when it is staring you in the face. The real shame about the whole mess is that these were bright guys and this was potentially a great company. All they had to do was have a little common sense and regular business accumen and they could have been on to a real winner here.
I would ultimately say to everyone that has an interest in business or the financial markets, however slight, that this book is a thumping good read and is worth some money ouot of anyone's pocket.
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