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

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4.11  ·  Rating Details  ·  9,637 Ratings  ·  344 Reviews
There were dozens of books about Watergate, but only All the President's Men gave readers the full story, with all the drama and nuance and exclusive reporting. And thirty years later, if you're going to read only one book on Watergate, that's still the one. Today, Enron is the biggest business story of our time, and Fortune senior writers Bethany McLean and Peter Elkind a ...more
Paperback, 480 pages
Published September 28th 2004 by Portfolio Trade (first published 2003)
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(showing 1-30 of 3,000)
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Michael
Dec 20, 2014 Michael rated it really liked it  ·  review of another edition
In the mid to late 90's, Houston based company Enron shone brightly as the pin up boy of corporate America. At it's peak in August 2000 it had over 20,000 employees world wide, projected revenue of $101 billion and a share price that hit an all time high $90. Fast forward just over a year and the unthinkable had happened with the company filing for bankruptcy as it share price ended the year at a disastrous $0.30.

The story of how Enron collapsed so quickly is one of corporate greed and deregulat
...more
Jarrod Jenkins
Mar 10, 2009 Jarrod Jenkins rated it really liked it
Shelves: nonfiction
That I am an internal auditor at a major oil and gas company undoubtedly contributed to my interest in this book. Nonetheless, McLean and Elkind's ability to present a convoluted and complex topic in an intriguing way culminate in this page-turner that anyone with even a moderate interest in business, accounting, economics, or current affairs will enjoy. The authors strike an effective balance between providing the nitty-gritty details of the accounting, the bigger picture, and the gossip.

In ma
...more
Rishi Prakash
Sep 25, 2013 Rishi Prakash rated it it was amazing
I had read about the scandalous fall of Enron while studying in graduation but it was just a news for me that time which was like any other news in the business page. It was much later that I started seeing the refernce of Enron in various corporate stories while reading and that is how my curiousity started building. And i must confess I would have never ever understood the significance of the entire Enron story if not for this great book. Enron has gone on to become a master case study to set ...more
George
Jan 05, 2009 George rated it it was amazing
This book is a must for just about everyone. It reads like a novel, but unfortunately its all non- fiction. This book proves that truth is sometimes stranger than fiction.
For anyone who has an interest in protecting your wealth and hard earned money, this is a must reead. I learned how important it is how your personal actions and behaviours can have such a detrimental affect not only to those around you but way beyond those that might seem unafected. The enron scandal was something that everyon
...more
Ryan
Jul 15, 2007 Ryan rated it really liked it  ·  review of another edition
Recommends it for: people interested in business ethics or think smart people will make the right decisions
Detailed history of Enron from its foundation to collapse, with particular attention paid to the critical characters (Ken Lay, Jeffrey Skilling, Andrew Fastow, etc.) Interesting if you think fall of Enron is an interesting subject (I do, but don't blame you if you don't). My biggest takeaway was the question of whether getting "the smartest guys" all together in a room will lead to good results, since it was clearly such a catastrophe in this case. And, if getting the smartest guys together in a ...more
Mathias
May 31, 2007 Mathias rated it really liked it
Shelves: businessprofiles
Another excellent work that provides insight into how financial incentive regimes (Regulations, Markets, Competitor Behavior)influence the actions of micro-players (CEO's, divisional managers, etc) in the business world.

Enron's collapse is a case study of what can go wrong in an economic system that lacks adequate checks and balances coupled with the increasing disempowerment of other important economic actors (labor unions etc). Unfortunately whatever lessons have been learned from Enron have y
...more
Nicola
Mar 10, 2011 Nicola rated it liked it
The Smartest Guys In the Room is a well-written, well-researched attempt to unravel the financial shenanigans that led to Enron’s bankruptcy. It’s a compelling (and sometimes soapy) indictment of the worst side of business, and it queasily foreshadows the financial crisis of 2008.

I can’t say enough about how well McLean and Elkind present the material in this book, but the fact remains that (a) it’s really, really long, and (b) it’s about finance. I learned a lot about securitization (etc.) as a
...more
Zack
Mar 16, 2013 Zack rated it really liked it
I watched the documentary based on this book, and while it was entertaining (in a sad, "how the hell do they get away with this sort of stuff" kind of way), 110 minutes is nowhere near enough time to unwind all of the chicanery and manipulation at the heart of the Enron scandal. The book, I'm happy to say, is far more comprehensive. And yet, although dealing with potentially dense, head-scratching issues of the structuring of complex financial instruments, it manages to be a compelling, dare i s ...more
Leah
May 20, 2012 Leah rated it liked it
Very well-researched and detailed book, sometimes too detailed. It's pretty well-written, but I gave it three stars because you can really get bogged down in the all the financial mumbo-jumbo. It's also kind of exhausting to read because you will be irritated by how arrogant and stupid the Enron leaders were, and as they make the same mistakes over and over, it's easy to lose interest as a reader. If you are someone who really likes reading about financial markets and business, though, this will ...more
Virgilio Pigliucci
Mar 23, 2012 Virgilio Pigliucci rated it it was ok
A great depiction of one of the biggest example, in modern history, of the "mafia" evolution to the highest levels, where the street violence and the low-level crime become high volume bribery and financial crimes that are capable of hitting way more people than the mob of the 70s.
I read the book in a few months... very interesting but hard to follow between so many numbers, episodes and not an easy narrative plot. When I was done with it I found the documentary on Netflix and after those 2 hour
...more
Ben
Apr 15, 2015 Ben rated it it was amazing
Shelves: adulthood
I enjoyed the documentary based on this book when it came out a few years ago and the book is fantastic as well. The book goes into a lot of detail about the chaotic profit-obsessed groundwork that led to the eventual scandals at the company. For example, years before their bankruptcy, Enron became so enamored with hotshots from Ivy League schools that they started ONLY hiring hotshot Ivy Leaguers who wanted to close big deals but had no interest in doing the grunt work necessary to make those d ...more
Athan Tolis
Jan 15, 2014 Athan Tolis rated it really liked it
This book is generally acknowledged to be the definitive account on Enron and the creative accounting era. And it is a truly overwhelming piece of research.

In contrast with "Barbarians", "When Genius Failed" or the more recent "Billionaire's Apprentice", it does not read like a narrative, and that's because it really can't. Enron was a lot more complex than a single transaction or a single hedge fund. It was an agglomeration of businesses, each with its own specific character. You can't go over
...more
Billy Keene
Jul 23, 2013 Billy Keene rated it it was amazing
I normally won't write a review but for this masterpiece I will make an exception. This book goes into great detail profiling the giant behometh known as Enron and the genius behind its marketing, product, and accounting structure which later turned out to be a pure illusion. The scope and breadth of the research involved was enjoyable to read. I especially enjoyed the way the characters were able to relate to and the author did a great job highlighting Kenneth Lay and Jeffrey Skilling's "Win-At ...more
Katherine
May 29, 2008 Katherine rated it really liked it
This book takes accounting fraud so complex that Wall Street write large didn't understand it for years and boils it down in a way that is understandable and, more surprisingly, fairly riveting. I am a bit of a junkie for this kind of story (I'd really like to be a prosecutor of white collar crime, I think), but the writers do a pretty incredible job, and given what a major issue Enron has been in our economy, in the law, and in the regulation of corporations, I think this is a worthwhile read f ...more
Thom Dunn
"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 erer 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...." (from the inside fron
...more
Kate
Dec 13, 2008 Kate rated it really liked it
If you scratch your head trying figure out all of these acronyms in finance, it's worth going back and reading about some of the boys who took off-balance sheet transactions to a whole new level. So much has been written about the rise and fall of Enron, but this book does it succinctly and at a layman's level. Plus they give you the whole People magazine backstory on these traders, including the names of the strip clubs in Houston the frequented and Ken Lay's difficult childhood.
Jowanza Joseph
Jan 07, 2016 Jowanza Joseph rated it it was amazing
I never thought accounting would provide so much entertainment. Since I knew little of exactly what occurred with Enron I wanted to give this a shot and it did not disappoint.
Downward
May 12, 2016 Downward rated it liked it
an in depth view of the financial scandal that many of us recognize by name but are a little blurry on the details. as it stands, that hasn't changed but through no fault of the author's. this book is packed tight with info that plays at a pitch i can't really hear. it's an indictment of an american system that gets away with things through making them so complicated that nobody wants to check, and so they just assume that nobody is ripping anybody off. if people just did their jobs, we'd be muc ...more
Mark Oppenlander
It's hard to believe that Enron declared bankruptcy almost 14 years ago now; the wound of it is still pretty fresh in collective consciousness. The rise and fall of this American company will stand for a long time as one of the great tales of economic hubris. Bethany McLean and Peter Elkind were the financial journalists who first broke the Enron story and this book is their definitive account of the whole sordid thing.

I've previously seen the documentary film based on this book, so much of what
...more
David Quinn
Nov 07, 2015 David Quinn rated it liked it
A solid 3 stars but a book I find difficult to recommend.

At its heart this is a story of several dislikable Icaruses (Icari?) with a Greek chorus consisting of the Enron trading employees. Unfortunately, to get to that story you must wade through much accounting arcana. The accounting aspects are central to the story so I don’t think there’s an easy way around it.

While the book deserves credit for being the first comprehensive telling of the Enron debacle, 12+ years after it was first published
...more
Iain
Sep 21, 2015 Iain rated it really liked it
A case of study of infuriating capitalist greed, megalomania, and sociopathic tendencies, that would be the top brass of Enron. This book is well researched and brings all the players of the (at the time) largest bankruptcy in U.S. history into perspective. "The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron" written by Bethany McLean (a superb investigative journalist) brings you right into the boardroom (if you want to call it that) and shows what a group of A-type pe ...more
Kirk
Sep 09, 2015 Kirk rated it it was amazing
What a book. There was so much going on at Enron, it was fucked up in so many ways. What a dysfunctional company. The contents of this book could be fodder for all sorts of useful lessons, such as:

- Role of management in a public company: Public cheerleader, booster of stock value or steward of the company's assets? Can we put Friedmanism to bed?
- Business ethics: whether not doing something strictly illegal is the full extent of moral responsibility
- Employee incentives: What happens when y
...more
Murali Neelakantan
Feb 06, 2015 Murali Neelakantan rated it really liked it
A well researched account of the key events and actors in the Enron saga. A book that every corporate executive ought to read every few years so that they are reminded that once the line is crossed, it is forgotten and there is no turning back. Unsurprisingly, despite the amount of press coverage that the scandal got, there seem to be a number of similar events over the last decade. What should worry us is that we now have a breed of executives in corporations, banks, consulting firms, law firms ...more
Achtung Englander
Jan 01, 2015 Achtung Englander rated it really liked it
Shelves: business
It all started with Enron. Before the banking crises that saw Lemhan Brothers file for the biggest bankruptcy in history, the word "Enron" was synonymous with failed business of a scale never heard of before.

The book is written in a gripping manner that is both easy to read without wallowing in the intricacies of its financial machinations, and delves into the personalities and politics of people who scammed the business. You will be shaking your head in anger at the sort of money we are talkin
...more
Frank
Nov 22, 2014 Frank rated it it was amazing  ·  review of another edition
An excellent summation of one of the most complex court case/bankruptcy/fraud. The book starts with the author comparing himself to Woodward and Bernstein's "All the President's men" which I found a bit presumptuous and set off a red flag. But after reading the book, I have to agree a bit with the analogy. While there's obvious differences (the author isn't even found in the book. Company versus government. Mildly complex but easy to understand vs. "WTF" levels of complexity" The comparison actu ...more
Nick
Nov 08, 2014 Nick rated it it was amazing  ·  review of another edition
Shelves: finance-business
Absolutely superb. This is captivating. Admittedly I have worked in areas that overlap a little with Enron (not power, oil & gas though). But in this book, which is c.420 small print pages, the revelations and facts just keep on coming and keep you reading. It is genuinely a page turner, and you wouldn't necessarily expect that from a book about esoteric off balance sheet accounting.

But, of course, this isn't really about the accounting. It is about the people. Those people whose greed and a
...more
Bryce Wong
Sep 02, 2014 Bryce Wong rated it it was amazing
This book offers its readers a peek into the lives of Enron’s masterminds, graphically describing the events leading up to their demise. What first started out as a winning formula to earning truckloads of cash from trading soon culminated into a series of accounting frauds, lies, and deceptions to deceive the public into thinking that they were actually successful despite racking up huge debts. Think of Enron as the mother of energy back in its heydays. They had assets that were comparable if n ...more
Carl
Few are as good as Bethany McLean at telling a comprehensible, compelling story about very complicated business topics. While I think her All the Devils Are Here (with Joe Nocera), about the 2007-8 financial meltdown and credit crisis, is better, this first book of hers (with Peter Elkind) is also superlative. The writing seems more controlled in the second book, and the story much harder to tell; the accomplishment there seems superior...but that's niggling criticism. The Enron story continues ...more
Biafra
Aug 27, 2015 Biafra rated it really liked it
What an adventure. In short, the book describes the key players, their personalities, ambitions, and background, along with the financial forces at work that created the culture of Enron and thus the seeds for its dramatic rise and fall.

While a bit more background on the history of Northern Natural Gas (predecessor of Enron) would have been interesting, the book does a great job of describing the various markets that Enron entered (from securitizing natural gas futures to the attempts to do the
...more
Libby
Aug 07, 2014 Libby rated it it was amazing
Loving it so far. Very readable.

p. 41 "The most dangerous problem of all is the very thing that makes mark-to-market accounting seem so seductive in the first place: growth. When the initial deals are cut and all the potential profits are immediately posted, a company using mark-to-market accounting appears to be growing rapidly. Wall Street analysts applaud, and the stock rockets upward. But how do you keep that growth rate up? True, you're still receiving the cash from past contracts. But you
...more
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Bethany McLean is a contributing editor to Vanity Fair magazine, and known for her work on the Enron scandal. She had been an editor at large and columnist for Fortune magazine.

McLean grew up in Hibbing and received her BA in English and mathematics at Williams College in 1992. After college and prior to joining Fortune, she worked as an investment banker for Goldman Sachs.
More about Bethany McLean...

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“The tale of Enron is a story of human weakness, of hubris and greed and rampant self-delusion; of ambition run amok; of a grand experiment in the deregulated world; of a business model that didn’t work; and of smart people who believed their next gamble would cover their last disaster—and who couldn’t admit they were wrong.” 2 likes
“Back in those less complicated times, there were lots of industries that operated more or less by rote: the old banker’s motto, for instance, was “3-6-3”: take money in at 3 percent, lend it out at 6 percent, and be on the golf course by 3 P.M.” 2 likes
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