Re: Enron and CA

Article View: la.general

Article #878

#878

From: Jeffrey Siegal
Date: Sat, 26 Jan 2002 10:49

24 lines
2382 bytes

Answers wrote:
> > Enron was a middleman.  They didn't produce the power in California,
> > they just bought and sold it. While they sold power at high prices, they
> > also bought power at high prices (ideally, from their point of view,
> > less high).  So it is really hard to say how much they netted out of
> > California.  What's more, California was only a small part of their
> > business.
> 
> How small, and how do you know?  

I don't remember the exact figures on "how small" but I remember doing
the research back when the California crisis was current news and
concluding that it was a small part of Enron's business.  

> Then why was Lay on Frontline talking
> about how much CA owes Enron?

Probably because Enron's margins on much of the power it sold to
California (as part of a trading operation, which means buying the power
from someone else) were not all that high, so the prospect of not
getting paid is a much bigger deal than the money it stood to make on
the business.  If, for example, you sell something for $1 and it costs
you $0.90, then you lose nine times as much if you don't get paid than
you make if you do get paid.

Technical Details

Message-ID: <3C5289B0.59E06114@quiotix.com>

Path:

arc1-ca.pugleaf.net!archiver1.google.com!news1.google.com!sn-xit-02!sn-post-02!sn-post-01!supernews.com!corp.supernews.com!not-for-mail

References:

<3C452770.4060008@ucla.edu> <B86B0A4B.575A8%no-spam@borg.radiomonopoly.com> <slrna4ble7.7jq.jimbo@newbolt.sonic.net> <3C460E95.3010704@quiotix.com> <3C4BCCF1.1040108@ucla.edu>

Show Full Headers

Complete Article Headers

X-Google-Language: ENGLISH,ASCII-7-bit
X-Google-Thread: 106ed4,b2bcf06cce1fde08
X-Google-Attributes: gid106ed4,public
X-Google-Thread: 104eff,b2bcf06cce1fde08
X-Google-Attributes: gid104eff,public
X-Google-Thread: f824f,b2bcf06cce1fde08
X-Google-Attributes: gidf824f,public
X-Google-Thread: 107d03,b2bcf06cce1fde08
X-Google-Attributes: gid107d03,public
X-Google-ArrivalTime: 2002-01-26 02:49:20 PST
Path: arc1-ca.pugleaf.net!archiver1.google.com!news1.google.com!sn-xit-02!sn-post-02!sn-post-01!supernews.com!corp.supernews.com!not-for-mail
From: Jeffrey Siegal <jbs@quiotix.com>
Newsgroups: la.general,ba.general,ca.general,ca.politics
Subject: Re: Enron and CA
Date: Sat, 26 Jan 2002 02:49:20 -0800
Organization: Posted via Supernews, http://www.supernews.com
Message-ID: <3C5289B0.59E06114@quiotix.com>
X-Mailer: Mozilla 4.79 [en] (WinNT; U)
X-Accept-Language: en
MIME-Version: 1.0
References: <3C452770.4060008@ucla.edu> <B86B0A4B.575A8%no-spam@borg.radiomonopoly.com> <slrna4ble7.7jq.jimbo@newbolt.sonic.net> <3C460E95.3010704@quiotix.com> <3C4BCCF1.1040108@ucla.edu>
Content-Type: text/plain; charset=us-ascii
Content-Transfer-Encoding: 7bit
X-Complaints-To: newsabuse@supernews.com
Lines: 24

Reply to Parent Message