Wednesday, February 21, 2007

Monkey Business Management Secret #6

A Study of "Enron-omics"

Feudalism

You have two cows. Your lord and master takes some of the milk.

Capitalism

You have two cows. You sell one and buy a bull. Your herd multiplies and the economy grows. You sell them and retire on the income.

Communism

You have two cows. The government takes both and says they belong to the people, then hires you to take care of them and sells you the milk.

Fascism

You have two cows. The government takes them away by train, denies that meat packing ever existed and drafts you into the army. They tell you cows are the enemy and Milk is banned.

Enron Capitalism

You have two cows. You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a Debt/Equity swap with an Associated General Offer so that you get all four cows back, with a tax exemption for five cows.

The milk rights of the six cows are transferred via an intermediary to a Cayman Island company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company.

The Annual Report says the company owns eight cows with an option on one more.

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