Customer Reviews

24 Days: How Two Wall Street Journal Reporters Uncovered the Lies that Destroyed Faith in Corporate America

5 star:		(16)
4 star:		(12)
3 star:		(3)
2 star:		(1)
1 star:		(2)

 

 

This is a terrific book. It should be read by anyone who invests because it will give you a better understanding of not only the Enron case, but of the problem of corrupt executives playing fast and loose with their responsibilities to the investors who employ them. Remember, the investors own the company, not the executives. They are hired help who are supposed to look after the interests of those who have put up hard cash for stock in the corporation and who are taking the financial risk as residual claimants. (Of course, those taking risks include the employees who probably have retirement investments in the company). It is a lively read and provides a great deal of valuable information along with the intrigue and outrageous revelations.

There are three story lines that flow like counterpoint. I found them riveting, but I enjoy reading about business. (You probably do as well, or why are you reading about this book?)

First, we follow Rebecca Smith and John Emshwiller as they track down leads in developing news stories about the sudden resignation of Enron's young CEO, Jeff Skilling. This seemingly minor story develops into the amazing and unexpected collapse of Enron as its corrupt financial dealings and improper accounting practices are exposed. We also follow the race between the authors as reporters for the Wall Street Journal racing against the New York Times, the LA Times, and the national TV news programs to get the story out first.

Second, we get the story of Enron and how Ken Lay, Jeff Skilling, and especially Andy Fastow worked hard to keep the true state of the company hidden from investors and regulators. We see how they drew others into their plans and punished those who wouldn't go along. The story makes clear how Andersen was brought down by an account team that allowed their lust for tens of millions of dollars in consulting fees to corrupt their accounting responsibilities.

Third, we see how both the climb and collapse of Enron affected average and honest people just trying to do their jobs. It was easy to get caught up in the rise of Enron and to believe in what was going on because the sickeningly corrupt practices were kept hidden for so long. Some of these executives, who reaped untold millions in personal rewards, might argue that everything was disclosed as required by letter of the regulations. But it seems to me that it was all just a way of lying while going to the right up to the edge of violating the letter of the law and then slipping over. Enron and Andersen management ended up not being as slick as they thought and ended up destroying both companies and hurting tens of thousands of innocent folks.

Another virtue of this books is that it is straight reporting. Rather than being advocacy journalism, it reports the facts of the case as they unfolded. I like this approach a great deal and think it strengthens the message of the book. You are free to make your own interpretation of the events presented. The authors do express their own reactions to certain events and revelations, but do not draw final conclusions of guilt or innocence. Nor do they try to apportion blame, although they do report comments and judgments of others who do.

Really, I wish this book would be read widely because it would help potential investors realize the need they have to pay close attention to the management team of companies they choose to invest in. They also need to educate themselves as much as possible on the industries and accounting practices of not only the companies they invest in, but also their competitors. Such awareness can help set off the "something isn't right" detector. Unfortunately, when things appear to be going well hard questions are usually not asked and when things fall apart it is usually too late to start asking.

This is a fine book that will have a permanent place on your shelf of business books.

24 Days reads like a John Grisham novel with the (naturally) two journalists as the protaginists sifting through the piles of obfuscation to get to the truth. Ultimately, the book shows that those who raided Enron were nothing more than common crooks, con men and money grubbing amoralists whose only interest was lining their own pockets. Sadly, justice has yet to be (if it ever will) served against many who were involved and the connections between Enron and current Administration remain woefully underreported.

What I can say is that the two journalists have done a great job of showing how the house of cards fell down. My only criticism, and it's a minor one, is that to the layperson, many of the financial terms will be hard to understand and the complex transactions that hid the billions in debt Enron had can be difficult to follow. Otherwise, this is highly recommended reading for people who want to know what crony capitalism is all about.

The authors, both Wall Street Journal beat reporters, found themselves in the middle of the paper's coverage of the demise of Enron at the end of 2001. They do an admirable job of retelling the story of Enron's 24 day death spiral - from October 16, 2002 when Enron announced big losses associated with two partnerships to December 3rd when Enron filed for Chapter 11 Bankruptcy. If you missed any of the daily installments in this big-business soap opera, this work will fill in most of the gaps.

There's also the story of what it's like to cover a big on-going economic event for the nation's leading business daily. The Journal's reporters can be confident that media sensitive business people are going to respond to their calls first. However, the writers give the impression that they were pretty much on their own after that and that all the Journal editors in New York do is decide on how much space to devote to each article.

I had two complaints about this otherwise solid book. First, after 381 pages, I'm still not sure how the villainous partnerships worked. The authors spent lots of time in 2001 trying to figure them out. It would have been nice if they had used this book to tell in a clear way what they discovered. How were they set up? How did they enrich Enron employees and how did they contribute to Enron's destruction? The second complaint comes form the author's attempt to personalize their coverage. Each time I read about their gulps of coffee in the morning and hints of bad feeling between the two of them I cringed. Smith and Emshwiller are solid business reporters - they and we would be better served if they stuck to their knitting.

This book is on the surface about how two Wall Street Journal reporters broke the stories that were part of the amazing collapse of Enron. In just 24 days the company went from an investment hot spot, to bankruptcy. This book is supposedly about just what happened to bring on this decline. However, there are three layers to this story and the book is not what it seems. The first layer is about the events themselves. The second layer is about the role of the journalists, and the third layer is about what happened in our society to allow this to take place.

Regarding the depictions of the events, the book does a good job at describing the revelations, financial statements, and spin control that gradually exposed the towering revenues of Enron to be little more than creative accounting, and inter-company agreements that were carefully designed to give the illusion of revenues. On this sense the book is engaging and quite fascinating.

However it is the second layer, the reporters themselves, that are the real story here. Are they just reporting the news, or making it? It seems they are largely unaware about their own role. Namely, they had no idea what they were doing! Seriously, I lost count how many times one of the two commented that they had no idea what the complex financial statements from Enron actually meant. This didn't stop them from reporting on it though. Another look gives some of the disturbing motivations behind the "innocent" reporting:

"Though Emshwiller didn't mention it, he hoped that their stories had a role in Fastow's departure. It was one of those perversities on journalism that reporters sometimes took satisfaction from the woes of people they hardly knew, or had never met". (Page 158) "With a small pang of guilt, Emshwiller couldn't help hoping that if the guy was going to be laid off, it would come sooner than later". (Page 298) What these quotes, and dozens more like it, indicate is that at least for one of the reporters, he was more than a little biased, and tried to expose some issues for little more than his own glory. The only sense of humanity we see from these two comes from when Smith is talking to the widow of a former Enron executive who killed himself.

I found this element of this book disturbing. While these reporters were eventually correct, they often created a short term "run-at-the-bank" scenario that hurt the company BEFORE the facts were known. I would surmise that neither of these two reporters were aware of just how poorly they can be viewed through this book. Sometimes it is better to be lucky than good I suppose.

The third layer of the story is about how our society allowed this corporate malfeasance to occur. Smith hits on it briefly in a statement about how Lay's comments about earnings and financial statements were "Clinton-esque", but they both avoid the bigger picture throughout the book. They seem content to grab as much personal glory for themselves as they can, and avoid the bigger and more difficult work of attempting to describe how our collective morality seemed to give way to greed in the early part of the 2000's.

For me this was the most enjoyable of the Enron books. What struck another reviewer as a negative -- how in the dark the reporters were about what they were writings about -- struck me as well, for a different reason, namely, how worrisome it is that things that have such a gigantic effect on the market's perception of the company can be so hard to find out about. And, as that reviewer pointed out, it highlights how little the media who write about the "business world" really know about the details. (Of course, anyone who has ever read a news story about a company they work for is aware of this).
I enjoyed following the reporters' quest to find things out - the "reporter as information hero" approach. It reminded me of "All the President's Men" and the days when I respected the press as the natural adversaries of bovernment / big business, which is always stonewalling. I also found the book to be much more intelligently written than many of the other books on the subject. I also agree with the reviewer who would have liked to see more discussion of What it All Means, although it's easy to see why the authors would have regarded that subject as something no one is interested in.

I thoroughly enjoyed the story of two journalists painstakingly uncovering Enron Corporation lie by lie. Brilliant insight into the little-known world of how the WSJ reporters approach major companies. This is an important read for all corporate PR departments and top managers. In today's world, exevcutives must know how to deal with the press. ... However, I am disappointed the authors didn't simplify the accounting transactions and take time to really spell them out. They could have used some illustrations to give an idea of what Enron's CFO was doing. I read the book carefully, but still can't explain to others the basics of "off-balance-sheet partnerships". So, you will find this book insightful. It is well written. The reporting has the WSJ truthfulness about it. But,I just wish they took the time to explain off-blance sheet partnerships. Many companies use them legally/ethically. So what are they? I am still not exactly sure what Enron did.

This book gives a very clear description of "who knew what, when," or "who told what, when." The authors convey the excitement of trying to develop contacts within Enron and Arthur Andersen, and how they had to protect their sources. They describe in detail how they broke the story, and how, in 24 days, Enron and Anderson both imploded. I remember reading the original Wall Street Journal articles and being amazed at how the reporters covered the company, even after the media feeding frenzy began three weeks into the implosion.

I agree with other reviewers who say the accounting schemes needed to be explained better. Basically, one needs to know the relationship between a company's balance sheet and cash flow statement. With that, the reader can understand how Enron tried to off-load its liabilities (from the balance sheet) and used Special Purpose Entities (such as LJM, LJM2, and the Raptors, which Enron funded) to inflate their income. The Special Purpose Entities themselves "paid" for the Enron assets with stock that Enron supplied to the Special Purpose Entities (without charging Balance sheet "Equity.") Get it? The house of cards was OK until Enron stock began falling.

The story ends in 2003, and there have been a lot of developments since then. Nevertheless, this is an exciting story.

As a busy law student, I heard the hub about the Enron and Andersen demise. But I never knew the big players or how things happened. This book gave me a great background on how things unraveled. I felt as though I had read the newspaper reports on Enron from beginning to end. The authors made this book a quick-read. Despite the complexity of the Enron transactions that lead to its downfall, the authors tried to make reading comprension easier for those unfamiliar with corporate dealings and the accounting/financial industry tactics used to further Amercian business. This is a great book that underscored the importance of caution in investing, and also highlights the side of corporate America that are unrevealed to the average investor. Wonderful especially for those who didn't keep up with the scandal when it was initially unfolding.

This book will be especially valuable to those who have a keen interest in "the amazing rise and scandalous fall of Enron." I also commend to their attention McLean and Elkind's The Smartest Guys in the Room. Whereas Smith and Emshwiller explored the same company as investigative reporters, McLean and Elkind seem (to me) to have approached their subject as corporate anthropologists. Both books reach many of the same (albeit somewhat tentative) conclusions as to what happened...and why.

Two significant differences are that Smith and Emshwiller limit their attention primarily to a period in 2001 extending from October 16th (when Enron announced huge losses caused by two partnerships) to December 2nd (when Enron filed for Chapter 11 bankruptcy); McLean and Elkind cover a two-year period of the company's "amazing rise and scandalous fall." Also, McLean and Elkind devote far more attention to each of the "smartest guys"; Smith and Emshwiller seem less interested in them, except in terms of the impact of their mismanagement and corruption. Let's say there are two books about the collapse of the twin towers at the World Trade Center; one focuses on the human tragedies associated with it whereas a second book addresses design, construction, and structural issues. Obviously, both approaches are valid.

In certain respects, this book reminds me of Carl Bernstein and Bob Woodward's All the President's Men. In both, the reader is provided with a rigorous and comprehensive examination of the process by which investigative journalists generate, evaluate, and pursue leads, then tell a "story" based on the material they have accumulated. Smith and Emshwiller are the focal points in this book. Their reader feels as if she or he accompanies them each step of the way (at least I did) as they methodically probe ever more deeply into Enron's immensely complicated corporate infrastructure. As already suggested, their focus is less on the personalities of the deal makers than on the deals they made; also on how and why they were able to conceal various illegalities and improprieties long before December 3rd, 2001, when Enron filed for Chapter 11 bankruptcy.

For me, one of the most interesting subjects which Smith and Emshwiller discuss is Arthur Andersen's association with Enron to which they devote several chapters. Given the nature and extent of Enron's financial implosion, what role did its longtime auditor play? And what about other reputable firms such as Citigroup, JPMorgan Chase, and Merrill Lynch which were also centrally involved with Enron's senior managers as they methodically and relentlessly constructed what has since been called "a house of cards"? Smith and Emshwiller could not have possibly provided definitive answers to questions such as these when their book went to press. Perhaps those answers will not be fully revealed for years to come.

I am grateful for the opportunity to learn what I did from this book. My personal preference, however, is for McLean and Elkind's The Smartest Guys in the Room because I have a greater interest in the who and why rather than the how and when. Nonetheless, I highly recommend both books and presume to suggest that 24 Days be read first.

This is a pretty decent book. It gives a fairly good overview of what went wrong with Enron and a fairly good look at the process the authors worked through in reporting on Enron for the Wall Street Journal. So, why don't I rate it a 5-star book? Mainly because it doesn't excel in either area. As an Enron story, it's far less revealing than "The Smartest Guys in the Room". As a book about what it's like to be reporters breaking a huge story, I think it fails to convey the sense of excitement and accomplishment they must have felt. So, in my opinion, they produced a good, interesting book that fell far short of its potential.

My memory of the events unfolding around Enron's spectacular failure places The Wall Street Journal in a leading role in terms of pressuring the company to start to be more forthcoming in its public dealings. Surely there was a lot of intrigue and tension involved with being the reporters driving this story. But this book doesn't really give the reader a feeling about what that was like. Maybe it was as nearly routine as the feel of the book suggests, but I have to believe it was more gripping than that. And as far as telling the Enron failure story, this book gives a decent overview, but there are better chronicles of that story.

So, was I disappointed that I read this book? No, it was pretty good. I just felt it could have been a lot more. I think I'm coming to the conclusion that writers for periodicals don't tend to write the best books. They're good at "just the facts, Ma'am" storytelling, but to deliver a really outstanding book, a writer has to be able to use the larger canvas to paint pictures that he can place the reader in. These authors don't do that and, I'd say that unless you're pretty interested in the Enron story, you could skip this one.