Dear John Hall

John Hall
Wed, 23 Jan 2002 16:32:20 -0800

1. "People who go broke in a big way never miss any meals.  It is the poor
soul short a half-slug that has to tighten his belt."  R. A. Heinlein
2. "Son, if you steal in this business you'll never be allowed back in.  So
if you're gonna do it do it right.  Don't steal a loaf of bread.  Don't even
steal the delivery truck.  You better make off with the whole darn Bakery."
Dr. Robert Whiting, my old Engineering Professor.

That being said some of the things I've heard don't indicate the top brass
really thought the bubble would implode.  Lay apparently sold some stock to
meet margin calls, but that was back in late July.  He held on to a lot of
stock, presumably because he thought the price would go back up.

People sometimes assume conspiracy when incompetence is a better

However, shredding documents is obstruction of justice (at least) and leaves
a dark suspicion of criminal intent.

-----Original Message-----
From: []On Behalf Of Russell
Sent: Tuesday, January 22, 2002 1:34 PM
Subject: RE: Dear John Hall

>The high level executives at Enron will be fighting lawsuits and criminal
>probes, if not looking at actual jail time, for the rest of their lives.
>That, too, might have some effect.

Well .. if some of them end up broke and in jail, then yes,
others in their position will want to avoid that end. But
if they are merely required to hire lawyers to defend against
lawsuits, and to give testimony before a grand jury, while
managing to keep their freedom and wealth, then they win.
If your net worth is $50M, then spending $2M on lawyers and
$2.5M on settlements and fines and $500K on spin does not
seriously impact your balance sheet. Indeed, even if it
costs you half your assets, it may well have been worth the
ride. At a certain and controlled level, legal troubles are
just another form of tax. And if handled right, it turns
into publicity that keeps your name in the public eye and
cements your reputation as a serious player.

I hope there are some pitbull prosecutors pouring over the
Enron mess. But they have their work cut out for them, even
if there is plenty of evidence of wrongdoing.

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