Buy, Lie, and Sell High: How Investors Lost Out on Enron and the Internet Bubble [Hardcover]

D. Quinn Mills (Author), Daniel Quinn Mills (Author)

Book Description

Publication Date: June 19, 2002 | Series: Financial Times Prentice Hall Books.

Millions lost fortunes in the Internet collapse -- and, according to conventional wisdom, they only have themselves to blame for being greedy, shortsighted, and ignorant of business fundamentals. But is that the real story? In this riveting book, Harvard Business School Professor Daniel Quinn Mills argues that the Internet bubble and subsequent collapse was no accident: blame can be placed squarely at the feet of venture firms, investment banks, accountants, mutual funds, brokerages, federal regulators, and the Federal Reserve -- not "dumb small investors." Through extensive original research and the contributions of many active participants, Buy, Lie, and Sell High offers authoritative answers to the questions every investor is asking: "What actually happened during the Internet bubble?" "Who got the money I lost?" "Why did it happen?" "Who's to blame?" "What can I do about it?" "Will it happen again, and how can I keep it from happening to me?" Mills compares the U.S. Internet bubble with events in Germany, where an Internet bubble also arose -- but with radically different and far less serious consequences. Drawing on the same ideas, he also offers the first detailed analysis of the Enron collapse. Then, Mills presents a specific, rigorous analytical structure for helping investors avoid future bubbles -- as well as the first detailed proposals for effective reform.

Editorial Reviews

From the Back Cover

"It never ceases to amaze me how some financial experts can dissect the public financial markets in ways that would have allowed us to avoid some of the disasters we have seen lately had we had this advice in advance. Buy, Lie, and Sell High is a book written with such clarity and analysis that even the least experienced of us can greatly benefit. It is a great read, with excellent advice, and I highly recommend it. It may save you financially."

—Senator Orrin Hatch, R, Utah
Member, U.S. Senate Committee on Finance

Why did the Internet and Enron stock collapses really happen? Was it arrogance? Greed? The "madness of crowds"? Just plain bad luck? Or something else entirely?

In Buy, Lie, and Sell High, Harvard Business School Professor D. Quinn Mills offers the first systematic analysis of both the Internet stock bubble and the Enron scandal. Drawing upon new research-including an extensive review of the latest lawsuits and securities documents-Mills uncovers both systemic causes and outrageous misbehavior. He demonstrates how each link in the "financial value chain," from venture funds to auditors and regulators, not only failed to protect small investors, but also actively contributed to their losses.

Mills demonstrates why it didn't have to be that way, comparing the U.S. experience with that of Germany, which experienced its own Internet stock bubble with far milder consequences to ordinary investors. He then offers practical and detailed recommendations for investors, citizens, and policymakers seeking to keep it from happening again.

Includes exclusive interviews with and contributions by:

• Ted Dintersmith, Charles River Ventures
• Julian Kurz, The Boston Consulting Group
• Robert Glauber, CEO/President, National Association of Security Dealers
• Barbara Boehnlein, Ph.D., ABN AMRO Rothschild
• Patrick Boos, entrepreneur, Webmiles
• Wilfried Beeck, entrepreneur, Intershop
• Christoph Peck, Management Angels
• Christiane Sommer, entrepreneur, BRAND EINS
• Juergen Kohr, entrepreneur, DATACOM.net

The Internet bubble: What really happened—and why.

• Includes the first detailed analysis of the Enron collapse
• Why the Internet stock collapse was no accident
• Who lost—and who benefited
• How the disaster could have been averted
• Avoiding the next speculative bubble: techniques for investors, recommendations for policymakers

Investors lost millions of dollars in the Internet collapse—and, according to conventional wisdom, they only have themselves to blame for being greedy, shortsighted, and ignorant of business fundamentals. But is that the real story? In this riveting and insightful book, Harvard Business School Professor D. Quinn Mills argues that the Internet bubble and subsequent collapse was no accident: Blame can be placed squarely at the feet of venture firms, investment banks, accountants, mutual funds, brokerages, federal regulators, and the Federal Reserve—not "dumb small investors." Through extensive original research and the contributions of many active participants, Buy, Lie, and Sell High offers authoritative answers to the questions every investor is asking: "What actually happened during the Internet bubble?" "Who got the money I lost?" "Why did it happen?" "Who's to blame?" "What can I do about it?" "Will it happen again, and how can I keep it from happening to me?"

Mills compares the U.S. Internet bubble with events in Germany, where an Internet bubble also arose—but with radically different and far less serious consequences. Drawing on the same ideas, he also offers the first detailed analysis of the Enron collapse. Then Mills presents a specific, rigorous analytical structure for helping investors avoid future bubbles—as well as the first detailed proposals for effective reform.

Through extensive original research and the contributions of many active participants, Buy, Lie, and Sell High offers authoritative answers to the questions every investor is asking: "What actually happened?" "Who got the money I lost?" "Why did it happen?" "Who's to blame?" "What can I do about it?" And most important of all, "Will it happen again, and how can I keep it from happening to me?"

About the Author

D. QUINN MILLS is Alfred J. Weatherhead, Jr. Professor of Business Administration at Harvard Business School, where he teaches about leadership, strategy, organizations, and human resources. Mills previously taught at MIT's Sloan School of Management. From 1967 through 1974, he had overall responsibility in the U.S. government for wages and prices in the construction industries, constituting about 14% of U.S. GDP.

A prolific author, his books include eLEADERSHIP: Winning in 21st Century Business, and Broken Promises: An Unconventional View of What Went Wrong at IBM, a book that helped define strategies that were later used to turn IBM around.

In the early 1980s, he was among the first to examine the effects of demographics on management and consumption. He studied the baby boomers in his book Not Like Our Parents: How the Baby Boom Generation Is Changing. His 1991 book Rebirth of the Corporation helped trigger the movement from management to leadership, and his 1994 book The GEM Principle helped establish the empowerment approach to management.

Mills advises major corporations and consulting firms, and has been widely quoted in leading U.S. media, from The New York Times, The Wall Street Journal, and BusinessWeek to NBC's Today Show. He is a Fellow of The National Academy of Human Resources.

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Product Details

• Hardcover: 288 pages
• Publisher: Pearson Education; 1st edition (June 19, 2002)
• Language: English
• ISBN-10: 0130091138
• ISBN-13: 978-0130091130
• Product Dimensions: 9.3 x 6.2 x 1 inches
• Shipping Weight: 1.4 pounds
• Average Customer Review: 2.0 out of 5 stars  See all reviews (3 customer reviews)
• Amazon Best Sellers Rank: #2,832,730 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

8 of 8 people found the following review helpful:

3.0 out of 5 stars Good look at what went wrong during the Internet bubble, October 4, 2002

By 

Ben Rothke "Author of 'Computer Security: 20 ... (USA) - See all my reviews
(REAL NAME)   

This review is from: Buy, Lie, and Sell High: How Investors Lost Out on Enron and the Internet Bubble (Hardcover)

Buy, Lie, and Sell High provides an interesting look at the Internet bubble and what caused it.

It was a perfect storm of greedy people with little to no business experience, combined with unethical accounting firms, loose federal regulators, new technologies, and a hungry public looking to make a quick dollar.

While the book has ?Enron? in the title, there is not a whole lot about Enron in the book, perhaps 10 pages.

The book has a number of case studies of classic dot bombs. I am surprised that with all of the case studies, Mills did not discuss one of the biggest bombs, Value America.

Overall, the book provides a good look at what went wrong and how it can be prevented from happening again.

5 of 7 people found the following review helpful:

1.0 out of 5 stars Before you buy, read what they say about Amazon.com, January 9, 2005

By 

Peter S. Magnusson (Cupertino, CA United States) - See all my reviews
(REAL NAME)   

This review is from: Buy, Lie, and Sell High: How Investors Lost Out on Enron and the Internet Bubble (Hardcover)

I used the feature of searching and reading to check it out right here, online. I searched for their write-up of amazon.com. And it's there, on page 60.

Read those pages first. If you think the authors give an intelligent and insightful perspective on Amazon's role in the internet bubble, then by all means buy and read the book.

2.0 out of 5 stars Interesting stories, but little analysis, May 26, 2011

By 

Timothy Michael "Dr. Finance" (USA) - See all my reviews
(REAL NAME)   

This review is from: Buy, Lie, and Sell High: How Investors Lost Out on Enron and the Internet Bubble (Hardcover)

I've recommended this book to a few people, but after reading it again recently I was left with a sense of "so what?" about it. As a professor it's hard to get students to understand the type of dreck that was put into the IPO market during the bubble, and this book has a lot of documentation in it, and some incredible but true war stories of the era. I will still recommend it, but I think that there are probably better accounts of the bubble out there, some of them in academic journals.