Wall Street Meltdown: Unlearned Lessons From Enron

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  psd1941@...09/19/08 Report as spam
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  RE: Wall Street Meltdown: Unlearned Lessons From Enron

  Nothing new about it! We try to learn from post-disaster management (management by disasters) but do not want to make ourselves ready for preventive disaster management. Where is the time with any one for that? Failure of every Finance company is destined the fate of AIG unless the selection process of the CEOs and Executives under them is drastically changed and independent Selection Boards (totally unrelated to the company) and until the touts of the existing executives are avoided to sneak in at the top positions.
  
  Every person, particularly in the finance companies, awakes only after the disaster has been done. Every one who is placed at the helm of affairs of huge funds wants to play recklessly with the funds. This happens more when the top management inducts the like minded touts on various positions under them. Those persons with the fear of earning the ire of their mentors can't be expected to differ with the methods of laundering money they adopt. The men at top just want "Yes-men" irrespective of whether they cause the company swim or sink. Enron is a history now and AIG will become history later but none will take lesson from the weaknesses, loopholes and lacunae of these companies. Every body wants to see and rectify only the outward symptoms but none seeks to review the basic defects of the theoretical management and leadership styles that have become worn out in the companies.
  
  It is also not an unknown fact that the army of accountants and auditors also tow the lines of management instead of delving deep in to the company affairs, as they don't get enough time from expanding their own business and clientele. Innovative financing has nothing wrong in it unless it is handled properly, wisely and diligently.
  
  The today's management system needs to be reviewed and revamped not by virtue of symptoms but by the real causes of the disaster.

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  profmurph09/19/08 Report as spam
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  RE: Wall Street Meltdown: Unlearned Lessons From Enron

  Just not true. The underlying cause of the mortgage problem were civil rights and affordable housing groups, plus, US Congress in demanding easier access to home financing for those who could not afford to pay. Financial companies are no longer allowed to "redline" or evaluate credit-worthiness. Common sense is suspended when it comes to the "poor", underprivileged, minorities (blacks), or anyone else judged to be "entitled" whether financially qualified or not.

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  pgaluszka09/19/08 Report as spam
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  RE: Wall Street Meltdown: Unlearned Lessons From Enron

  Profmurph,
  I hate to strongly disagree with you. Banning racist practices like redlining goes back decades and can't be held to blame today.
  Peter Galuszka

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  tracydiziere&associates09/19/08 Report as spam
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  RE: Wall Street Meltdown: Unlearned Lessons From Enron

  Thanks for this insight, Peter. I'm so glad to see someone highlighting the issues that we can all learn from. I was just complaining on my blog post(http://mymarketingperson.blogspot.com/2008/09/learning-from-failure.html) that failures aren't talked about as examples compared to successes, unless they are the Enrons. Although perhaps slightly different for small businesses, the principles Salter lists ("attention to board oversight, financial incentives and ethical discipline")can be easily adapted and will certainly be food for thought for my future discussions.
  --Tracy Diziere