ENRON:
Enron was a giant global corporation that depended on outside credit sources to finance its daily operations. In turn its credit- worthiness depended on its performance as reflected in its share prices. Enron was a corporate superpower. One of the reasons why people felt safe investing in Enron was its size and the inelasticity of its main product – the buying and selling of energy. Energy is a necessity and the quantity demanded will not change much if at all due to higher prices. The energy market, unlike other sectors of the economy – is dominated by a few very large companies, oscillating from the state of oligopoly to that of a monopoly. The energy market was loosely regulated and these factors set the stage for the numerous unethical and illegal activities in the operation and financial reporting of this once giant organization. Enron allegedly became successful, trading over 800 different products worldwide, but was mainly recognized as the main buyer and seller of energy. Enron’s enormous size and inelastic product of energy made investors feel safe. Energy has inelastic demand, Enron was the number one supplier of Energy, and so Enron set the market. Enron supplied high returns to its investors, held enormous influence in government and helped create the policies for the energy market. In my opinion Enron grew too fast, was too strong, and held to much influence - making it a victim of its success and of its leader’s greed and arrogance.

Brief History of Enron: Enron was created when the Houston Natural Gas Company merged with InterNorth, a natural gas company in July, 1985. Originally Enron was an operator of interstate gas pipelines, but by 1989 Enron diversified into trading energy-related commodities. In a few years, Enron becomes the largest merchant of energy in the United States and the United Kingdom. By 1994 Enron becomes the largest