Chapter 631 Enron Can't Go Down

Just as Director Wang was about to write his signature, the secretary hurriedly walked over and whispered in Director Wang's ear: "Leader, something has happened to Enron Corporation. An article was published in the latest issue of Fortune magazine in the United States, secretly It means that Enron has falsely reported profits.”

   said the secretary, and handed over the Fortune magazine.

   Director Wang has a master's degree in engineering and can naturally understand English. Although Director Wang does not recognize some financial terms in the article, he can still understand the content of the entire article.

   After reading this article, Director Wang frowned suddenly. At this time, he remembered Li Weidong's speculation.

   "There is really a problem with the Enron Company, and this Li Weidong has confirmed it again! Could it be that the Enron Company will really go bankrupt? In that case, it will really affect the construction of the entire West-East Gas Pipeline Project."

  Lin Mancang watched Director Wang put down the pen in his hand, took over an English magazine and read it for a while, then his expression became frozen, so he asked, "Director Wang? What's wrong?"

   Director Wang pondered for a moment and said, "Mr. Lin, put this contract with me for the time being! After I sign it, I will send someone to deliver it to you."

  Lin Mancang suddenly showed an anxious expression, and he asked, "What happened?"

   "There may be a problem with Enron in the United States. I need to contact the staff in the United States to find out the details." Director Wang replied.

  …

   "Fortune" magazine, an article called "Is Enron Stock Price Overvalued?" The author is Bethany McLean.

   In terms of finance and economics, Fortune magazine is still extremely authoritative, unlike The Economist, which shouts that China is collapsing every three days, and it lasts more than 30 years.

  Fortune is a must-see magazine if you work on Wall Street.

   Thanks to the $20,000 sponsored by Li Weidong, Bethany-McLean found a professional accountant to review the financial reports of Enron in recent years, and then used a lot of data in the article to question the profitability of Enron.

   Of course, all Bethany-McLean can do is question. Although it can be clearly felt that Enron's profit has a problem, but Enron's fake accounts are very rigorous, and there is no problem at all from the figures.

  However, after the McLean article was published, how did Enron make money, and how did the myth of Enron's stock rising all the time was created, which has become a question for countless ordinary investors.

  This article can be described as one stone that made a thousand waves, Enron is one of the hottest companies in the United States, and countless investors have invested in Enron. When the question of how Enron made money came up, these investors all waited for Enron's answer.

   However, Enron did not answer this question.

   In the face of doubts, Enron did not answer directly, but issued a few non-painful statements, as if to tell all the media that I really have a problem!

   Next, the media, relying on their strong investigative capabilities, pieced together Enron's massive investment around the world in recent years, but it did not make any profit, or even lost money.

   For example, Enron invested 3 billion US dollars to build a power plant in India, but because the electricity price was too high, the Indian government refused to buy the power transmitted by the power plant.

   In this transaction, Enron was also tricked by the Indians.

  India first draws a big picture, such as how dynamic the Indian economy is, how big the market is with such a large population in India, and investing in India will definitely make money, etc. Fudge Enron to India to build a power plant.

  Enron's decision-making level is also stupid, believing the Indians' rhetoric, thinking that India is a big market, and really investing in India.

   After the power plant was built, the Indian government said that the price of electricity from the Enron power plant was too expensive, and asked Enron to lower the price, otherwise they would not buy Enron's electricity.

  India's plan is that you have invested 3 billion US dollars, and the power plant has been built. If you don't sell electricity, the investment will be wasted. So I use this method to force you to lower the price, and then India will have cheap electricity.

And Enron's idea is that there are hundreds of millions of people in India who do not have access to electricity, and they also need electricity to engage in industrial production. If there is no electricity, your Indian people will continue to live in darkness, and your Indian factories will not be able to produce , you will not be able to make money, and you will encounter problems in India's development and economic growth.

   Both parties believed that you were asking for me, and as a result, things were deadlocked. One side just doesn't buy it because it's too expensive, and the other side just doesn't cut the price!

   In fact, this is a win-win business. If both sides take a step back, Enron can make money and India can get electricity.

   In the end, both sides liked to be on the front line, and finally formed a lose-lose result, and no one got any benefits.

  This is actually caused by the difference between American thinking and Indian thinking.

American values ​​are more inclined to zero-sum thinking. They believe that when one party gains benefits, the other party must suffer losses. The more benefits one party gains, the more losses the other party suffers. Call it "zero-sum".

   And Americans have been sitting in the position of the world leader for too long, and they are accustomed to profit, thinking that their own profit is a matter of course, and others' gain is their own loss.

It is also because of zero-sum thinking that Americans often use the so-called "sanction stick", because in zero-sum thinking, the opponent's loss is their own gain, I sanction you, you suffer a loss, that is what I earn .

   This is probably equivalent to, I stabbed your pocket and lost your mobile phone, which means that I earned a mobile phone. It's the same logic as if you don't pick something up when you go out, even if you lose it!

   "Win-win cooperation" probably doesn't appear in the American dictionary. And "kill one thousand enemies and lose eight hundred", in the eyes of Americans, it means that I have earned you two hundred!

  Under the blessing of this zero-sum thinking, Enron did not agree to India’s request. They would rather the power plant not operate and be slowly abandoned instead of lowering the price of electricity.

   Many states in the history of the United States have experienced power crises, probably caused by this zero-sum thinking.

  When electricity consumption increases, the Chinese response is to increase the supply of electricity to meet the demand, while the American response is to increase the price of electricity.

  As a commodity, the demand for electricity has increased, so the price must be higher. If I still sell it at the original price, wouldn’t it be a loss?

   The selling at a loss here is not selling at a loss, but not earning more.

  In zero-sum thinking, I could have made more money, but in the end I didn’t earn that much, that is, I suffered a loss, which is absolutely impossible!

   Americans are zero-sum thinking and can only do business where I make money and you lose.

   The Indians can only let me earn yours, not you. In order to prevent you from earning mine, I would rather not earn, or even suffer some losses.

  India is open to foreign investment, but the premise of openness is that you can invest, but you cannot earn my Indian money. If you are here to make money in India, sorry, you are not welcome in India!

   Investors are not fools. If they don’t let me make money, why should I invest and do charity?

   The end result is that investors give up the Indian market, and India also loses an investment, a lose-lose situation.

   For example, the Indian Railways once issued a tender for the renovation of a railway in India, and a Chinese company finally won the bid.

  India did not want Chinese companies to make this money, so they found a reason to cancel the bidding directly, and then restarted the bidding, and added that only Indian companies can bid, and they should leave the opportunity to make money to Indians themselves.

   As a result, the technology of the Indian company could not meet the engineering requirements at all, so a few years later, the project is still in place.

  Similar things, India has done a lot of things, especially in terms of trade, it has often imposed a ban or increased tariffs, in the name of using this method to force companies to go to India to produce and drive India's industrial capacity.

   However, India has no raw materials, no transportation, workers are still lazy, companies have to invest, and they really do charity. India has successfully harmed the interests of other countries in its own way.

   Of course, there are also some leading companies that set up factories in India to invest, but only the companies themselves know whether they made any money in the end. Anyway, according to the latest news, Xiaomi, which is a better mix in India, has just been fined 6.5 billion rupees.

  The same is true of the Anran Power Plant. The Indians said that I would rather not use electricity, the people continue to light oil lamps, and the factories do handicrafts. They also force you to lower the price of electricity.

   This is very similar to the gangsters in Jinmen in the past. When collecting protection fees, they first stabbed themselves twice and asked if you were afraid! You are not afraid, right? Believe it or not, I will die at your door, and you are bloody!

  One is zero-sum thinking, and you must not make less money; the other is really brainless, I would rather die than let you make money. The final result is that the power plant is directly scrapped, and Enron's 3 billion investment is all wasted.

  Similar to this kind of failed investment, Enron has many more. In Brazil, in the Philippines, in Bolivia, and even in developed countries such as Germany and Japan, Enron lost its investment!

The success or failure of these investment projects can be easily verified. For example, if the power plant in India is in operation, you can tell it at a glance. You can even make a long-distance call and ask your local friends to find out. It doesn’t cost you money. Get an accountant to check the accounts.

  So the media quickly dug up the fact that Enron's investment project failed.

   So the question is, since Enron's investment is always losing, and it can easily lose billions of dollars, how did you make those profits written in the financial report?

  An enterprise of this size, if it falsified its financial reports, it would be flawless, and it would be impossible for a few accountants to find loopholes. Unless a state-level investigative agency intervenes.

   Therefore, if we start from the financial report data, it is estimated that the fraudulent financial report of Enron will be concealed.

   But starting from Enron's investment failure, it is easy to find that Enron's profits are falsely reported.

   All eyes are on Enron, and countless accountants on Wall Street are looking for loopholes in Enron's financial reports.

   The audit service for Enron is Anxinda Accounting Firm, which is one of the top five accounting firms in the United States. The accounts they do can be said to be seamless, how can it be so easy to find loopholes!

   However, it is precisely because it is in the spotlight that it has become the focus of public opinion. Enron does not dare to continue to make false accounts in the next financial report, so their latest financial report shows that the company lost 618 million US dollars in the last quarter.

   A quarterly loss of 618 million, or 2.5 billion a year, is not much for Enron's size.

  According to Enron's financial report last year, Enron's revenue last year was 100.8 billion US dollars!

   In just one year, from a profit of 100.8 billion US dollars to a loss of 2.5 billion US dollars, no matter how stupid investors have understood, Enron has a problem, and the problem is very serious!

  …

In the    conference room, a group of experts are having a heated debate on the matter of Enron.

   Lin Mancang of Huafu Gas and Li Weidong both attended the seminar. After all, they are both parties.

"Judging from the information released by the media, Enron's earnings are definitely fraudulent. And today, news has just come from the United States that the Securities Commission of the United States has started the investigation process against Enron." One The expert said.

"I am also following the progress of this incident of Enron." The second expert continued: "This time, the project in charge of Huafu Gas is the technical support provided by Enron. Once there is a problem with Enron, it is very It may affect the construction of our project and cause delays in the project.”

"It doesn't matter if such a big project is delayed for ten days and a half months. What I am more worried about is that it will directly lead to the shutdown of the project. If the construction is stopped halfway through, it will cause harm to our entire West-East Gas Pipeline Project. This One point, we have to guard against it!"

This time, a senior expert expressed his opinion. With an expression of recalling the past, he continued: "I have personally experienced similar things. In the late 1950s, we had many projects because of the withdrawal of foreign engineers. Go, and have to stop. Some of these projects, stop and never resume! We must learn a lesson!”

Someone also expressed a different opinion: "Enron's investigation does not affect Enron's technology for providing natural gas pipelines. Even if Enron is really falsified and even punished, the punishment will not penalize Enron's natural gas pipeline transmission. Technology."

"That's right, Enron may make false accounts or be punished, but Enron's natural gas pipeline transportation technology is the world's first. As long as Enron continues to provide technology to Huafu Gas, it will not affect the project. Construction." Another expert said.

   After listening to the opinions of these two experts, Director Wang looked at Lin Mancang and asked, "Mr. Lin, can Huafu Gas guarantee Enron's technology supply?"

   "Of course, we, Huafu Gas and Enron, have signed a contract." Lin Mancang nodded without hesitation, and continued:

"The scandal of making false accounts will affect the reputation of Enron, but it will not affect the technology of Enron. As long as Enron does not fail, they must provide us with technical support for natural pipelines in accordance with the contract, so our Engineering construction will not be affected!"

   "But what if the Enron Company went bankrupt?" an expert next to him asked.

"Hahaha!" Lin Mancang couldn't help laughing, and then said confidently and slowly; "How could Enron Company go bankrupt! To put it in a bad way, even if our Huafu Group goes bankrupt, Enron Company cannot go bankrupt! "

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   (end of this chapter)