The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron

The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron

by Bethany McLean, Peter Elkind
4.6 12

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Overview

The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron by Bethany McLean, Peter Elkind

Until the Spring of 2001, The Houston energy giant Enron epitomized the triumph of the new economy. Feared by rivals, worshiped by investors, Enron seemingly could do no wrong. Its profits rose every quarter; its stock price surged ever upward; its leaders were hailed as visionaries. Then a young Fortune writer named Bethany McLean wrote an article posing a simple question -- How, exactly, does Enron make its money? -- and the company's house of cards began to collapse. Though other business scandals would follow, none has had the shattering effect of Enron's bankruptcy, which caused Americans to lose faith in a system that rewarded top insiders with millions of dollars while small investors, including many Enron employees, lost everything. Despite enormous media coverage of Enron, the definitive story of its astonishing rise and fall comes alive for the first time in this gripping narrative by McLean and her Fortune colleague Peter Elkind. Drawing on a wide range of private documents and well-placed sources, many of them exclusive, McLean and Elkind lead you behind closed doors and deep into Enron's past, to pierce the veil of secrecy that has surrounded the company's inner workings and corrupt culture.

The Smartest Guys in the Room is fundamentally a human drama -- of people drunk on their own success, people so ambitious, so certain of their own brilliance, so fueled by greed and hubris that they believed they could fool the world. The book explores the motives, thoughts, and secret fears of a fascinating array of characters. No matter how much (or how little) you already know about Enron, the revelations in The Smartest Guys in the Room will shock you. You'll witness the astonishing extent to which Enron's business was an illusion. You'll meet the enigmatic Enron executive who seemed interested in only two things: money and strip clubs. You'll learn the truth about the California power crisis. You'll see how much Wall Street knew about Enron's shenanigans and why the Street chose to look the other way. You'll learn the dirty secrets that Merrill Lynch, Citigroup, and J. P. Morgan Chase have kept out of the headlines to this day. Just as Watergate was the defining political story of our time, so Enron is the biggest business story of our time. And just as All the President's Men was the one Watergate book that gave readers the full story, with all the drama and nuance, The Smartest Guys in the Room is the one book you have to read to understand this amazing business saga.

Product Details

ISBN-13: 9781591840534
Publisher: Penguin Publishing Group
Publication date: 09/28/2004
Edition description: Reprint
Pages: 480
Product dimensions: 5.63(w) x 8.45(h) x 1.08(d)
Age Range: 18 Years

About the Author

Bethany McLean and Peter Elkind collaborated on this book when they both were Fortune senior writers. McLean, a former investment banking analyst for Goldman Sachs, is now a contributing editor to Vanity Fair and lives in Chicago. Elkind, an award-winning investigative reporter, is now an editor-at-large for Fortune and lives in Fort Worth, Texas.

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Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron 4.7 out of 5 based on 0 ratings. 12 reviews.
durosas More than 1 year ago
So I started into Bethany McLean & Peter Elkind's narration of Enron's rise & fall with high expectations. My expectations were very high having seen the movie version of the same book admittedly several times and knowing that the book is often times better then the movie. Additionally being a subscriber to Fortune magazine I've been privy to both writers work and have been impressed with their style & substance. The Smartest Guys in the Room, The Amazing Rise and Scandalous Fall of Enron does do what a lot of books that are then made into movies which is to fill in gaps and put more meat on the bones of the story. The depth of character building that the authors put into the book is very well done, enhancing and providing greater insight into each of the key players (and a few contributing characters) then what is more broadly known. Further, McLean & Elkind's ability to simplify abstract and highly technical terminologies from the off-partnership entities to the accounting rigueur that Enron utilized allows even a non-MBAer to understand what occurred. The part that undoes most of this great work is the flow of the story-telling itself. With each successive deep-dive into a character the authors start at the earliest possible point in that persons career & then makes their way forward to the eventual demise of Enron and that persons role in it. The issue is that if you take that across the multitude of characters that they bring forward you get a sense that you're on a bungee chord dropping until you get to current events only to be pulled back upwards (or back in time) to restart with another character. It isn't until close to the end when, thankfully, all the character have been developed that the reader can then continue with a sequential story-line. Also, while the story itself is told from a fairly objective point-of-view you get the sense the authors, particularly McLean, are gunning for Jeff Skilling given his treatment of her as described in one part of the book. From a historical perspective one looks at Skilling and can say, he was judged by a jury of his peers and found guilty but when you contrast his actions with the actions of senior executives at the financial institutions during the recent financial crisis you have to ask, did he really do anything different? The financial institutions were reliant on ratings to ensure they had access to liquidity, just like Enron. They needed that liquidity to fund not only their day-to-day operations but any particular growth initiatives, just like Enron. Additionally, all counterparties were aware that this was how they operated because they were on the other end of the deals/transactions that were being made.just like Enron. And then, when that perception is altered, right or wrong, then it's like a deck of cards falling down as the shorts come out of the woodwork..just as Alan Schwartz, Dick Fuld, John Mack and.you got it, Jeff Skilling proclaimed. Now, did the financial institutions use off-balance sheet transactions to move debt to look like earnings? No. But they did use a tool that was highly risky and created increased level of leverages in CDOs. Different tool, same result. I haven't gotten to Crash of the Titans (Merrill Lynch), The Last of the Imperious Rich (Lehman Brothers), but it will be interesting to see what light the senior executives in the financial industry are cast..
Valerie-in-Ohio More than 1 year ago
I am only through the first few chapters (I work three jobs, so it's difficult to take in more than a few pages at a time.) however, I am so amazed at the scandalous minds that corrupted Enron and still to this day find it unbelievable the length of time the deceit went undetected! The authors write in such a way that it's very easy to understand and you can almost put yourself in the midst of the lies, false records, and greed; almost as if you're there just watching the events unfold. Very well written so far. So glad my husband made this purchase for me. Enjoy!
Anonymous More than 1 year ago
Anonymous More than 1 year ago
Guest More than 1 year ago
Enron is, of course, old news by now. The company went bankrupt in 2001, and its spectacular collapse was merely the first of a series of notorious corporate scandals. Most of the story Bethany McLean and Peter Elkind tell in their book has already appeared in newspaper and magazine accounts and in other, rush-to-publish books that hit the market during or shortly after the events described. However, these authors have assembled what may be the single most comprehensive, detailed account and written it like an anecdote-rich, lively business-based novel. We do wish they had included a timeline and a list of sources, since they have had the benefit of being able to draw on all of that other work, on indictments and on testimony before courts and Congress, but their account is engrossing and complete. If you read just one book on the Enron scandal, we believe this may be the book to read.
Guest More than 1 year ago
A compelling look at Enron's demise--the top executives are repugnant, amoral and astoundingly arrogant. The web of byzantine accounting practices at Enron should make all shareholders take a closer look at dya-to-day corporate activities. A well-written, well-researched, and informative read.
Guest More than 1 year ago
This book is thoughtfully written and certainly entertaining, even if at times repetitive. It is a thorough investigation into one of the most dramatic corporate scandals of our time. You don't have to know anything about Enron to enjoy the read. Most importantly, it gives the individual investor, corporate employee or corporate 'advisor' some insight on corporate ethics gone wrong. Egos took over here. As the saying goes 'If its too good to be true it probably is.'
Guest More than 1 year ago
Trully the best book on the greatest corporate scandal ever! Loaded with more details and history on the history and the events the lead to the downfall of Enron. And for people who no nothing of Enron, this book breaks it down down to the financial transactions. It is the best investagative book of our time.
Guest More than 1 year ago
The book was very detailed in its explaination of everything, Enron, how the system works and the people. One of the best books dealing with the business world. Readers may not find all the information interesting, maybe even boring!But can learn a great deal!
Guest More than 1 year ago
I thought it was a great book. I wondered if the authors would be able to convey not only the culture in Enron but the feeling that permeated the air in the market bubble. Great job on both. It is amazing that such a collection of people could allow some strange form of group psychology to permeate that made them believe that paper profits were more important than cash in hand. Of course cash was flowing into their hands (executives) ... just not the company's. Another point of interest is how people who are viewed as powerful are at times tied to and subordinate to the groups that make them powerful. Skilling for example, could not control the very group he created. All in all a good read.
Guest More than 1 year ago
Fantastic Read. The making of history in our country.
rsaluck More than 1 year ago
First of all, this book is a must read for everyone, particularly politicians and all CEOs of businesses. This is a clear example of what has gone wrong in the business world (and then some). I knew Enron had engaged in fraudulent and highly unethical business practices. However, i had no idea to the extent in which the management team at Enron abused ethics, the law, morality and everything else. I am not even sure what the goal was here. Nobody seemed to be happy in the book despite the money they made and the "status" that they achieved. And it is not just the management team to blame. The SEC, the FERC, the accountants, the attorneys and wall street all created this monster. Perhaps this was a prelude to the the recent scandals, which are the most prolific we have ever seen. The unfolding of events at Enron should have been a warning sign that something was/is truly wrong. There is no doubt in my mind that Enron was no different than a Mafia style boiler room operation. In any event, this shows how dangerous it is to let business run unregulated and unchecked. The goal of business cant just be to make money. It has to be more than that i hope. There has to be some modicum of respect for the law, for ethics and for each other. The way they treated each other and conducted even their personal lives was appalling. All the money in the world is not worth that legacy. The book is very well written and incredibly engaging and riveting. The story of Enron is truly shocking and the authors did a fine job in recounting this sad tale. I think that this is a must read for everyone--no wonder Buffett recommended this. It is sad that this could have happened on our watch.