Re: Enron SPV's and debt

["Karl Carlile" <dagda@xxxxxxxxxx>]

Stephen: iv) Enron books the $100 mn as revenue today tho it may have
made various
promises to the bank and to future investors in the SPV to make them
whole
for losses (through warrants or issuance of additional ENE stock, again
without full disclosure to current public shareholders).

v) the SPV packages the "asset" into a security and sells it to large
institutions or wealthy individuals as some kind of debt instrument
typically, promising a return linked to the asset's future cash flows.
This
is done in a private placement, thus not registered with the SEC.  I do
not
know FOF data records private placements of securities.  The list of
private
investors in the various SPV's is only partially known.  Pension funds,
endowments, foundations, trust funds, are typical purchasers.

Karl: This kind of stuff above is entirely  designed to have a  specific
political effect --a bourgeois effect. Instead of analysing the Enron
case to understand and highlight the way in which imperialist capital
functions in its exploitation and oppression of the working Stephen
tries to compete with bourgeois economic and financial commentators in
spinning a story about Enron. What Enron did and did not do is, in a
sense,  is neither here nor there if it is not underlined by clearly
defined politics based in the class interests of the working class.This
is why the subscriber who suggested that value relations is the level
from which wages and price must be understood. Enron must be understood
from that same critical basis.
Regards
Karl Carlile (Communist Global Group)
Be free to join our communism mailing list
at http://homepage.eircom.net/~kampf/