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

by Bethany McLean

The president capped the year by announcing that because of the crisis, he wouldn’t light the national Christmas tree.

Even sophisticated institutional investors—the analysts’ primary clients—often became angry at research analysts who turned bearish on stocks they held. It didn’t matter if the analyst’s insight was correct or perceptive; all that mattered was that he or she had hurt the stock.

Over time, many companies came to expect buy recommendations from analysts; it was often a prerequisite for getting banking business. And the more banking business a company did, the more leverage it had over the analysts who covered it.

At a conference in Las Vegas, Skilling offered up an astoundingly insensitive joke: “You know what the difference is between the state of California and the Titanic?” he asked, with a grin. “At least the lights were on when the Titanic went down.”