marketwatch.com — "Enron found legal ways to make money given the market rules that were in place and these strategies probably did influence prices...Enron did game the transmission rights market, but so did many other companies. Enron sent a letter to the state of California in 2000 telling them the market was flawed"
Jun 11, 2008 View in Crawl 4
ryan166Jun 12, 2008
I bet some dude got stuck in an elevator with a hot chick, and they f**ked their brains out.
psulionJun 12, 2008
Yeah ENRON was a pretty legitimate company. Last time I checked there was nothing wrong with cooking the books, insider trading, lying to the faces of investors, and telling them that the company was was in great shape, which caused them to lose over $40 billion of their life savings. Clearly you have no idea of the practices that occurred inside of this company.
3tcpJun 12, 2008
The enron loophole isn't an issue in the oil market because it's global and the money involved is so much that it can't be manipulated that way. It would take an organized effort by many investment brokers all over the world in control of trillions and trillions of dollars to be able to game the market like you're suggesting. The enron loophole allowed them to game a relatively local market and manipulate what was a relatively small number of people involved in purchasing & selling on it. Doing the same thing with oil would mean a global conspiracy of epic proportions. That is ridiculous imo.
mcanadaJun 13, 2008
I like your style and since this is 2002, I suggest you keep those US dollars.
chumly69Jun 13, 2008
Here's why this 6-year-old story needs to be on the front page:One of the key 'enablers' of Enron's scheme in 2000, was none other than McCain's CURRENT economic adviser: Phil Gramm.... See, people like us in California know all too well what Phil Gramm did to the price of electricity by 'deregulating' the energy market. Only now, it's not just CA... it's on a global scale. This comes from an article (NOT 6 yrs ago, but actually dated May 19, 2008) found here: <a class="user" href="http://www.consortiumnews.com/2008/051908a.html">http://www.consortiumnews.com/2008/051908a.html</a> SEN. JOHN McCAIN SAYS HE OPPOSES THE $307 BILLION FARM BILL BECAUSE IT WOULD DOLE OUT WASTEFUL SUBSIDIES, BUT HIS CHIEF ECONOMIC ADVISER PHIL GRAMM ALSO WANTS TO STOP ITS PROPOSED REGULATION OF ENERGY FUTURES TRADING, A MARKET THAT WAS FAMOUSLY ABUSED WHEN ENRON CORP. MANIPULATED CALIFORNIA'S ELECTRICITY PRICES IN 2001.Clearing the way for that California price gouging, Gramm, as a powerful Texas senator in 2000, slipped an Enron-backed provision into the Commodities Futures Modernization Act that exempted from regulation energy trading on electronic platforms. Then, over the next year, Enron – with Gramm’s wife Wendy serving on its board of directors – worked to create false electricity shortages in California, bilking consumers out of an estimated $40 billion.Gramm left the Senate in 2002 but now has emerged as what Fortune magazine calls “McCain’s econ brain,” not only filling the Arizona senator’s acknowledged void on economic expertise (“I don’t know as much about the economy as I should”) but recognized as one of McCain’s closest friends in politics. The two men talk daily.A McCain aide told me that the Arizona senator opposes the farm bill because it “rewards lobbyists” by granting rich farmers lucrative subsidies, although he would support “a reasonable level of assistance and risk management to farmers when they need America's help.”But the aide, who spoke on condition of anonymity, acknowledged that the presumptive Republican presidential nominee also opposes the farm bill because Gramm advised McCain that he should resist its regulatory language on the energy futures market.Democrats have dubbed that gap in energy futures regulation the “Enron loophole,” but it played a part, too, in the more recent attempt by the Amaranth Advisers hedge fund to corner the national gas market by shifting trades to the unregulated “dark markets” of the Intercontinental Exchange.The “Enron loophole” also has become part of the debate over the soaring price of oil. Last week, a study sponsored by Sen. Carl Levin, D-Michigan, concluded that speculative futures markets were partly to blame for the surge in oil prices that have pushed gas at the pump toward $4 a gallon.At a May 15 news conference, Levin said the skyrocketing price of oil is “not the result of supply and demand. Speculators have taken over most of the futures market."However, the 673-page farm bill, containing the regulatory provisions on electronic energy trading, still faces obstacles amid overall concerns about the bill’s largesse to farmers at a time of rising food prices.President George W. Bush has vowed to veto the bill, although it cleared the House and Senate by margins wide enough for an override, assuming Republicans don’t rally behind Bush and McCain, their current and future standard bearers.Gramm and EnronThe battle over the “Enron loophole” also could draw attention to McCain’s dependence on Gramm as his chief economic adviser and Gramm’s key role in passing legislation that let Enron trade commodities on electronic platforms without federal oversight.In 2000, with the Republicans in charge of Congress and Gramm chairing the Senate Banking Committee, the exemption on electronic trading was approved without a Senate hearing.Internal Enron documents, which were released in 2002, revealed that the Houston-based company helped write the legislation, which was signed into law by President Bill Clinton in December 2000.Freed from regulatory interference, Enron then used manipulative trading practices to game the California electricity market and drive up electricity prices across the state.While California consumers were getting fleeced, the new Bush administration shielded Enron from early accusations of market manipulation. President Bush personally joined the fight against imposing caps on the soaring price of electricity, buying additional time for Enron although the company’s house of cards collapsed anyway in fall 2001. [For details, see Consortiumnews.com’s “Bush’s Enron Lies.”]In 2006, the “Enron loophole” allowed Amaranth Advisers hedge fund to shift its trades from the regulated New York Mercantile Exchange (NYMEX) to the unregulated Intercontinental Exchange (ICE) in Atlanta.That let Amaranth corner the natural gas market, betting that futures prices would rise. The hedge fund lost about $6 billion and imploded as natural gas prices fell to a two-year low in September 2006.Last July, the Federal Energy Regulatory Commission and the Commodity Futures Trading Commission charged that Amaranth manipulated prices paid in the physical natural gas markets. FERC has proposed $291 million in penalties and the forfeiture of “unjust profits.”“Unregulated markets are known as ‘dark markets’ because there is very little oversight of the trades,” said Rep. Bart Stupak, D-Michigan, chairman of the subcommittee on Oversight and Investigations, during a hearing on energy speculation last December.By trading on the “dark” ICE market, traders can avoid the Commodity Futures Trading Commission’s rules which are in place to prevent price distortions or supply squeezes.Stupak said trading volumes on ICE “have skyrocketed in the past three years and are now as large or even larger in some months, than the volumes traded on the regulated futures market.”The lack of oversight “makes it difficult for regulators to detect excessively large positions which could lead to price manipulation,” Stupak said.Advising McCainGramm, who is now a vice chairman of financial services company UBS, began advising McCain in 2005 when the Arizona senator indicated he planned to run for President.Since then, McCain has adopted much of Gramm’s anti-tax, anti-regulatory agenda. Most strikingly, McCain shifted to support Bush’s tax cuts, which McCain had voted against in 2001 and 2003. He now vows that, if elected President, he would make them permanent.Yet Gramm’s influence over McCain’s economic agenda – and the checkered political-business history of Gramm and his wife Wendy – have largely escaped media scrutiny.Gramm received more than $34,000 in campaign contributions from Enron and served as one of the company’s key legislative allies in Washington, including his help in 2000 removing federal oversight from energy trades on electronic platforms.
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