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The Rise and Fall


15 min read
10 take-aways
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What's inside?

Enron rose fast and fell faster when behind the scenes manipulation, competition and dishonesty finally came to a head.

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Editorial Rating



  • Innovative
  • Eye Opening
  • Background


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, finds 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.


The Rise

Kenneth Lay was born in 1942 in the backwoods Missouri town of Tyrone, culturally and geographically remote from sophisticated city life. His father was a Southern Baptist minister who moonlighted as a farm equipment and feed salesman. By the time Lay was nine years old, he was earning money driving tractors and delivering newspapers. He eventually worked his way through college at the University of Missouri, St. Louis. He focused on accounting and economics, graduated Phi Beta Kappa in 1964 and earned his masters' degree in economics from the same school a year later.

Lay headed south and found work as a corporate economist at Humble Oil. While he was working, he went to night school at the University of Houston and got his Ph.D. in economics. He joined the Navy in 1968, attended Officer Candidates School and spent his tour of duty as a financial analyst. His work there, which saved the Pentagon several billion dollars, became the foundation of his Ph.D. dissertation. He stayed in Washington after his discharge, working for the Federal Power Commission (later known as the Federal Energy Regulatory Commission or FERC).

In 1973, he moved to Florida as...

About the Author

Loren Fox is a former senior editor at Business 2.0, a former Dow Jones News Service reporter and editor, and former finance editor of Upside Magazine. He has written for The Wall Street Journal, Barron’s, and others.

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