Customer Reviews

Enron: The Rise and Fall

5 star:		(4)
4 star:		(4)
3 star:		(1)
2 star:		(1)
1 star:		(0)

 

 

I am a former Enron employee from the mid-1990s. I do not hold any bitter or bad feelings from my exeperience there and firmly believe that I have benefitted from the experience. I have also previously read and reviewed the Cruver book stating that there would be other books giving a better perspective of the issues. Loren Fox's Enron: The Rise and Fall is one of those books.

Like a good non-fiction business writer, Fox takes a global approach in helping the reader understand what happened at Enron. He immediately lays out the working thesis that the collapse of Enron was symptomatic of the corporate culture at Enron but also reflective of the business environment at-large throughout the eighties and nineties. Even with this viewpoint in mind, he too acknowledges that he lacks all the answers because many of the outcomes from Enron's collapse are still in flux (e.g. Will Fastow go to jail? Will Lay and Skilling get indicted) and the ultimate impacts on corporate America are unclear (e.g. Where is Sbarnes-Oxley taking us?).

To support his thesis, Fox presents a well-researched book presenting the key players in the evolution of the energy giant. He provides the background information on the deregulation of the natural gas industry that led to the formation of Enron. He anlayzed the dueling business strategies of ECT and EI run by Skilling and Mark. With Skilling winning the political infighting, the off-balance sheet shennanigans became more important to obtaining the capital needed to support his grandiose visions. That is where Fastow and Kopper come in. Relative to other journalists including Pulitzer Prize winner Rebecca Smith, Fox better understands and explains the nature of the off-balance sheet transactions (e.g. often a form of Islamic financing but also more complex structures) created by these two but always adding color to story with his inside look at the key personalities (e.g. Kaminski saying, "This is so terminally stupid only Fastow could come up with it.").

It is obvious that Fox has had access and discussions with some very senior managers at Enron in completing this project. Despite that, it still feels as if he has only gotten part of the story. Still I must commend him for the best effort to date.

Enron's story seems to have happened all at once. There was a big company with a stock price shooting for the stars and, then, suddenly there was a massive fraud, and the two things came so close together it was like hearing the explosion from a fireworks display after you've seen the light in the sky. Loren Fox's account was one of the first books about Enron and remains one of the best. The author is a skillful, diligent reporter who managed to get the story first and get it right, although Enron did not authorize his book or cooperate with him. His discussion of the company's complex, illegal accounting maneuvers is thorough and, if not quite clear, certainly complete. The book was written during the relatively early stages of the legal proceedings against the architects of the Enron fraud, so a lot of the material uncovered by Justice Department and SEC investigators was not yet available. The demerit of this is that Fox was not able to include much that is now common knowledge about Enron. However, we find that there is an advantage as well: Fox was not excessively guided or directed by common knowledge and conventional wisdom, but instead carved his own path through the thicket of Enron's weird and instructive history.

This book, plus "24 Days," together tell you everything you need to know about the fall of Enron. This one covers the "rise" better, that one covers the "fall."

What one ought to take away from both books is the realization that, despite the failure and indeed despite the evident criminality, Enron (as Fox says in his epilogue), "wasn't a complete hoax. The company deserved admiration for its early forays into trading gas and electricity, and for its plunge into the innovative financing of energy projects. It out-maneuvered the old-line energy companies to expand the use of derivatives in the energy industry. This introduced new ways of managing risk, which lowered the costs of energy-related transactions for an array of businesses."

Another reviewer has said that the Fox book is a cure for insomnia. The fact is that if you need to have material on Enron MADE interesting for you by dramatic presentation, by a well-shaped narative flow, then you may have trouble with Fox, simply because he lets the material speak for itself.

Sometimes it speaks in ambiguous tones.

Loren Fox has done an excellent job detailing the actual events behind Enron and its demise. This book will appeal to any business and finance person. It's not just a recap of the headlines with flip stories. Rather, this is an indepth look at the original Enron business model and how it was used to set up fraudulent partnerships, etc. I was really impressed with the level of detail the author provided. He clearly has a deep understanding of the behind the scenes exchanges and access to excellent sources. Well done and should become the definitive book on Enron.

A must read for the real scoop. Loren Fox has done a first-rate job detailing the history of Enron and the innovative business model that fueled it's early success. He takes pains to point out where the seeds of Enron's destruction were sown, explaining in enough detail for the business novice to understand the rather arcane financial deals that were the company's main source of "income." Delving much more deeply than a mere overview, there is a wealth of company and industry sources used to provide fascinating detail to the arrogance that enabled the company to pull the wool over so many people's eyes.

I wasn't sure what happenend at Enron until I read this book. The author lays it all out in a well-written, fast-paced narrative: how Enron grew from pipeline operator to trading company; why Enron broke the law to fund its growth; how the revelation of its accounting misdeeds caused the company to collapse. Fox reveals such pearls as the fact that Enron's cut-throat culture encouraged employees to sabotage each other, and that arrogant Enron executives made critical decisions with shockingly little forethought. And it's all written so that the general reader without business expertise can understand this dramatic story. Highly recommended.

Good, solid background on the history of Enron and its missteps. If you're interested in one stop shopping for an understanding of Enron the corporation from start to finish, this is the best out there so far.

Fox provides a critical link in the Enron story by focusing on a company history. This book is not really the story of Lay, Skilling and Fastow and the fall of Arthur Anderson. This is a book on how Enron the company rose to prominence and fell just as quickly. From the commoditization of energy trading to the asset light strategy that the company adopted the reader is taken on a step by step process of how the company fell. It is a careful business analysis and not a narrative so if you do not have experience reading and understanding business terminology this is probably not the book for you. This book does not delve into the stories behind the company so if you want the book that will vilify those who ran the company you will have to look elsewhere. For those who simply want a company history of Enron then this is for you.

Loren Fox's account of the Enron debacle is one of the more boring written on what was a fascinating story of greed and corporate immorality. I have read three books regarding the downfall of Enron (The Smartest Guys in the Room and Anatomy of Greed being the others), and this was the most difficult read of the three, by far.

First, Fox's account reads more like a Harvard Business School case study than anything else. For some, this may be attractive, but explaining forwards, swaps and various other derivatives over three pages isn't the most exciting reading one can do. It is valuable if you really want to dig into Enron's beginnings with "asset light" philosophy, but one really only needs this level of detail if they are delving into the corporate world of derivatives and trading. For the rest of us, it is uneccessary and quite boring. Given the time Enron: The Rise and Fall was written (shortly after the bankruptcy), it is insightful. Also given that it was written before The Smartest Guys in the Room was released, it was at one time probably the best of the bunch. Now that other information has been released via congressional hearings and other written accounts, the information provided by Fox reads like a textbook.

Another problem is that Fox misses much of the personality of the executives and other employees of Enron. He admitedly has little to go by other than written records at that time, and has little more than detailed accounts of Enron's activities to show for it. While important to describe in detail how Enron evolved into the company it became, he misses the personalities behind the evolution. For instance, the corporate structure was such that people from every division within the company clashed at every turn. This is a mere mention in Fox's account, whereas in The Smartest Guys in the Room, this is an important part of the Enron downfall. Also, the California debacle is mentioned briefly in The Rise and Fall, but without the detail that the other story gives. What is just as important about the rise and (if not more importantly) the fall of Enron, are the egomaniacal personalities behind the company. These personalities are not described in nearly enough detail in The Rise and Fall, leaving the story bland and lacking.

What is left is a textbook story of Enron that leaves out much of the drama of the real Enron. While I appreciate that Fox avoided some of the Hollywood, daytime television aspects of Enron (unlike The Smartest Guys in the Room or Anatomy of Greed) to merely sell books, much of this aspect of the Enron story is important to the overall tale of "The Rise and Fall." Unfortunately, it is missing in Fox's book.

I've read several Enron books, from Cruver's poor product to Lynn Brewer's silly treatise, and I have to say that this one is probably more accurate and balanced than any of the others, but..... it's a real snorefest. Any author that can take a fascinating story like this and put a reader to sleep with it is not really overachieving in my view.

I guess Fox couldn't get anyone significant to talk to him and maybe that held him back some, but it didn't keep Cruver and Brewer and Swartz from producing more entertaining stuff in their efforts which were similarly unencumbered by input from people who were really making it happen. Oh well, he produced a "fair and balanced" treatment that just might help you with that insomnia thing.