imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
Features
latest news
best of news
syndication
commentary


KILLRADIO

VozMob

ABCF LA

A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List

LAAMN List




IMC Network:

Original Cities

www.indymedia.org africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities

www.indymedia.org africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

It’s Time to sell Stocks and Buy Gold

by Gary Larrabee Tuesday, Feb. 12, 2002 at 5:51 AM

Enron is the tip of the iceberg - In 2001, with 'pro forma' creative accounting, the top 500 US listed companies were able to report earnings of 42 percent more than that allowed by 'generally accepted accounting principles', writes David Podvin in an article, Multi-Trillion Dollar Financial Scandal.

Rumor Mill News Reading Room Forum

http://www.rumormillnews.net/cgi-bin/config.pl

AMERICA INFECTED WITH ILLEGAL ACCOUNTING METHODS

Posted By: Boudewijn Wegerif

Date: Saturday, 9 February 2002, 4:44 p.m.

MULTI-TRILLION DOLLAR FINANCIAL SCANDAL -

'This Thing Involves Everybody'

By David Podvin - February 4, 2002

"Immediately after business slave George W. Bush took power, Corporate

America went on a lying spree. Dan Rather, Tom Brokaw and Peter Jennings

appear loath to report that such high profile companies as Viacom, General

Electric, and Disney are also engaging in the accounting scheme."

MISSING THE OVERALL

A multi-trillion dollar financial scandal is occurring in the United States

right now. It threatens to inflict unprecedented carnage upon Corporate

America and horrific damage to our national economy. The mainstream media

is aware of it, but most Americans are not, because the corporate news

outlets refuse to report on it. It is not conspiracy. It is complicity.

The coverage of the Enron situation has primarily focused on the

disintegration of a powerful corporation due to the deceit and criminality

of those who ran the company. The few reporters who have looked below the

surface have proven linkage between Enron's corruption and its political

connections to the Bush administration. While the crimes of former Enron

chairman Kenneth Lay and the collusion of former Texas governor George W.

Bush are significant, the corporate media is selfishly choosing not to

focus on the big story.

In February of 2001, Enron stock was trading above per share, which

placed a market value of more than billion on the company. Today, the

stock no longer trades, rendering Enron virtually worthless. It is crucial

to remember that, despite the harrowing decline in its fortunes, the

company never reported a bad earnings quarter.

Enron's duplicity is an extreme symptom of a financial cancer that

threatens the health of the economy. The disease is a malignant accounting

method that has received legal protection from conservative politicians on

behalf of their corporate benefactors. It is called 'pro forma'. Originally

intended to allow companies to compensate for extraordinary events that

distorted their financial reports, the pro forma accounting method has led

to the greatest fraud ever perpetrated.

Previously, publicly owned companies had been legally required to provide

shareholders with an honest accounting of their earnings. The standard used

was GAAP, Generally Accepted Accounting Principles. Under this method, a

company would state its earnings based on the old fashioned equation of

income minus expenses. Using pro forma, companies decide which expenses are

irrelevant, thereby providing great latitude for creativity.

Freed from concerns about regulatory oversight, this country's biggest

companies became dramatically more 'creative' with their earnings reports.

Current estimates for S&P 500 corporations are that they have collectively

earned about 0 billion in 2001 when using the pro forma accounting

method. However, when using GAAP, they have collectively earned about 0

billion.

Those who claim that Enron was an exceptional case are technically correct.

While Enron overestimated its earnings by 100%, the average large publicly

held American corporation is overestimating its earnings by only 42%.

IBM reports pro forma earnings. So does Intel. And Cisco Systems. And Dell.

And Sun Micro. And Motorola. And Microsoft. And... By engaging in such

manipulation, with the assent of accountants and governmental oversight

agencies, Corporate America has conned the public into investing trillions

of dollars based on phony earnings. Cisco, for example, has used its

artificially inflated stock price as capital to acquire other companies.

Many corporate empires have been built on such accounting legerdemain,

including General Electric (NBC), Viacom (CBS), Disney (ABC), AOL/Time

Warner (CNN, Time Magazine), News Corporation (Fox), The Washington Post

Company (Washington Post, Newsweek), the Tribune Corporation (Chicago

Tribune, Los Angeles Times), and the New York Times Company (New York

Times, Boston Globe).

Enron is the tip of an iceberg on which sits the entire mainstream media. A

national association of accounting firms has called on the Securities and

Exchange Commission to require all publicly held corporations to report

real GAAP earnings. The return to ethical accounting standards would mean

that, in order to reflect the current valuation of the Dow Industrials, the

average would fall to 5825. In order to reach the historical norm based on

GAAP, the Dow would decline to 3300.

A major decline in stock prices would erase trillions of dollars of

investors' wealth. With the uninformed public currently heavily invested in

the market, this would have a crushing impact on the finances of the

average American.

In 1995, Senate Republicans and almost half of their Democratic colleagues

joined to override President Clinton's veto of legislation providing

corporations with protection from shareholder lawsuits. The leader of the

effort to dramatically reduce civil liability for companies that report

phony earnings was Wall Street lobbyist Harvey Pitt, who has made a career

of defending the shady dealings of stock market thieves like Ivan Boesky.

Just as his father hid the magnitude of the savings and loan scandal until

after the 1988 election, Bush is desperately trying to obscure the truth

about Corporate America's financial sleight of hand in order to defer the

tumbling of the house of cards until after the 2004 campaign. He expects to

be helped in this effort by the man he appointed to be Chairman of the

Securities and Exchange Commission, the one who is most responsible for

seeing that corporations accurately report their earnings. Harvey Pitt.

The powers that be are pulling out all the stops. What they are fighting is

the law of gravity. As the high powered executives at Enron learned, all

the political machinations in the world can't prevent a stock from falling

when the word gets out that the books have been cooked.

After investors discover they've been scammed, they sell, and the mightiest

of companies can be crushed. Less than a year ago, Enron was the seventh

largest corporation in America. Today, it is no longer functioning as a

business entity. It is, for all intents and purposes, dead.

The greatest legacy of the Enron debacle will be increased public pressure

on companies to report their real earnings. If corporations are forced to

be honest, then there will be shocking revisions in the financial

statements of America's most prominent businesses.

The current situation is a scandal of almost incomprehensible magnitude,

but it is not a conspiracy. For years, the disgrace of earnings

manipulation has been an open, dirty little secret. Dissidents like the

highly respected money managers at Comstock Partners

(http://www.comstockfunds.com/) and brokerage analyst Alan Newman

(http://www.cross-currents.net/charts.htm) have been screaming bloody

murder about how Corporate America is cheating the public.

Their voices have not been amplified. Dan Rather, Tom Brokaw and Peter

Jennings appear loath to report that such high profile companies as Viacom,

General Electric, and Disney are also engaging in the accounting scheme.

The current reported level of corporate earnings is a mirage. The investing

public has been taken for a magic carpet ride. The deceit of management,

now so evident in the case of Enron, is endemic in corporate boardrooms

across America. It is the massive impending economic fallout from that

bitter reality which is the looming tragedy in this story.

While the media continues to focus on the microcosm of corruption at Enron,

the public at large has yet to be informed of the epidemic of the earnings

lies. As Deep Throat told Bob Woodward during the Watergate scandal, when

the reporter was focusing on the criminal behavior of Nixon functionary

Donald Segretti, "You're missing the big picture. You're missing the

overall." "This thing involves everybody."

New Economic System for the Kingdom of God

http://www.ourchurch.com/view/?pageID=33156



SOURCES:

Report this post as:

LATEST COMMENTS ABOUT THIS ARTICLE
Listed below are the 10 latest comments of 1 posted about this article.
These comments are anonymously submitted by the website visitors.
TITLE AUTHOR DATE
you say.... name Wednesday, Feb. 27, 2002 at 11:20 PM

Local News

Change Links September 2018 posted S02 10:22PM

More Scandals Rock Southern California Nuke Plant San Onofre A30 11:09PM

Site Outage Friday A30 3:49PM

Change Links August 2018 A14 1:56AM

Setback for Developer of SC Farm Land A12 11:09PM

More problems at Shutdown San Onofre Nuke J29 10:40PM

Change Links 2018 July posted J09 8:27PM

More Pix: "Families Belong Together," Pasadena J02 7:16PM

"Families Belong Together" March, Pasadena J02 7:08PM

Short Report on the Families Belong Together Protest in Los Angeles J30 11:26PM

Summer 2018 National Immigrant Solidarity Network News Alert! J11 6:58AM

Watch the Debate: Excluded Candidates for Governor of California M31 5:20AM

Change Links June 2018 posted M28 7:41AM

The Montrose Peace Vigil at 12 Years M22 8:01PM

Unity Archive Project M21 9:42AM

Dianne Feinstein's Promotion of War, Secret Animal Abuse, Military Profiteering, Censorshi M17 10:22PM

CA Senate Bill 1303 would require an independent coroner rather than being part of police M10 9:08PM

Three years after OC snitch scandal, no charges filed against sheriffs deputies M10 8:57PM

California police agencies violate Brown Act (open meetings) M02 8:31PM

Insane Company Wants To Send Nuke Plant Waste To New Mexico A29 11:47PM

Change Links May 2018 A27 8:40AM

Worker-Owned Car Wash on Vermont Closed A27 5:37AM

GUIDE TO REBEL CITY LOS ANGELES AVAILABLE A13 12:39AM

lausd whistle blower A11 6:58AM

Website Upgrade A10 10:02AM

Help KCET and UCLA identify 60s-70s Chicano images A04 8:02PM

UCLA Luskin: Casting Youth Justice in a Different Light A02 6:58PM

Change Links April 2018 A01 6:27PM

More Local News...

Other/Breaking News

Chuck Grassley: Women Abusing, Animal Murdering, Illegal War Supporting Criminal S22 2:58AM

Finance Capitalism and the Digital Economy S21 4:45PM

Muselières syndicales, muselières patronales S21 7:19AM

Jeff Bezos, Amazon, The Washington Post, Whole Foods, Etc S21 2:50AM

Why Choose Nut Milk Over Cows' Milk S21 1:01AM

Antrhopocène, le grand effondrement S19 9:53AM

Creative Destruction Hack Diamonds Windows/iOS/Android - Creative Destruction Generator S19 12:51AM

Abolir l'économie S18 11:18AM

The Dictatorship of Corporations S17 5:26PM

18 Lethal Consequences Of Hunting S17 3:13PM

Paraphysique de l'outplacement déontologue S15 6:51AM

Creative Destruction Hack Mod Generator S15 3:49AM

Shopping du bashing S14 8:42AM

After Lehman Brothers, Experts Say Global Financial Crisis Can Happen Again S13 8:28PM

“Animaniacs in Concert!” Starring Voice Legend Rob Paulsen S12 9:30PM

Probabilités de fin d'humanité S12 6:49AM

Florida Area of Migrant Farmworkers Denied Right to Construct Health Clinic near NaplesCIW S11 2:57AM

Propagande de virus, virus de propagande S10 7:34AM

Steer clear of work morality! S09 12:10PM

Sweatshop Lodge Ceremony Continues in US Fed Prisons Led by Inmates S08 6:17PM

Paraphysique de l'origami S08 7:11AM

The Shortwave Report 09/07/18 Listen Globally! S06 11:23PM

August 2018 Honduras Coup update S06 12:28PM

Du réussissement putréfié S06 10:55AM

Brett Kavanaugh Filled The 5th Circuit With Execution Judges S06 6:14AM

Log S06 4:25AM

Augusta Georgia Woman Gets 5 Year Prison Sentence for Writing About Russians Crime Acts S05 8:29AM

Paraphysique de contextualité S05 8:29AM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy