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Talking Points

Enron was different from most of the other companies that are discussed in this book because it wasn't a start-up but instead was an old, established company. Nevertheless, Enron played an important part in the Internet bubble.

Enron transformed its image in the public mind from a natural gas company into an energy trader, much of whose business was done on the Internet. With the help of investment banks it created financial entities, often partnerships, that allowed it to magnify its revenues and reduce its expenses in ways that gave it rapid growth and profitability, and made it very difficult for investors to keep track of its debts. Its own executives and partners in some of its banks participated financially as individuals in these entities. Its accountants accepted these devices, while contributions to politicians helped result in favorable regulatory decisions.


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