In the afternoon, the boss of an investment firm on Wall Street sat in his office and watched the news on TV.
Suddenly, his face changed, and he picked up his phone. "From now on, sell off all our Enron shares! You don't need to care about our losses! This is an order! If you cannot sell off your shares within half an hour, pack your things and get lost! "
Not only this boss, but the bosses of many investment companies and securities companies also chose to sell their stocks after seeing the news on TV and the two professors' articles in the newspapers.
Those who did not follow the news were shocked. What's going on? Why are so many people selling their Enron shares? Yesterday, Enron had announced that there will be high profits soon, and their share prices should continue to rise.
Some people guessed that it is because of technical adjustments.
If that's the case, then it should be the banker who clears the market. They should use this opportunity to buy more Enron shares to reduce their costs.
So, when many people are selling their Enron shares, some companies start to buy Enron shares in bulk, and they did not notice the news.
Those in the financial industry do not even have real-time information, and it's not surprising for them to lose money.
At this time, Enron held an emergency board meeting. Not only the board members, but some of the company's top executives are also present.
"Everyone, our share prices are plummeting now. Can anyone tell me what we should do?" Enron's Chairman asked.
"I think we can get someone to refute what Feng said. He is not a professional in the financial industry, and what he said cannot be trusted!" Someone suggested.
"What about those two professors from Harvard Business School? They are professionals and can be regarded as authoritative. "
"We can make those two change their words. I don't think anything is priceless," the man gritted his teeth and replied. Other than this solution, he can't think of anything better.
When the Chairman saw this news today, he asked his broker to sell off all his Enron shares. Although he had suffered significant losses by selling off his shares, his losses will be higher if he waited until tomorrow.
At this time, some people who do not read the newspapers and TV received news on the internet that Enron is suspected of falsifying their financial reports.
They want to sell off their Enron shares but realized they cannot do so.
As everyone is selling their shares, no one wants to buy them. Enron's shares cannot be sold, and the share prices are plummeting. Those people placed orders, each one lower than the last.
He was afraid that if he waited any longer, these shares would be equivalent to a piece of waste paper!
At this time, the bosses of the securities companies and investment companies who had been buying at a low price in the afternoon were about to cry. They thought they had picked up a bargain, but it turned out to be a trap!
Now that it was in his hands, when the market opened tomorrow, it would definitely continue to fall.
Those who had sold their Enron shares earlier are relieved. Although the crazy dumping caused them to lose a lot of money, some big companies even lost tens of millions of dollars. But it was still better than having nothing left in the end.
…
"Fall, fall, fall! Hahaha … Feng, you are too amazing. Enron's shares had started to plummet. Why did such a big company issue so few shares? We didn't even lend out many shares to short the company. "Kirilenko said with a regretful look.
"That's not bad. At first, you still want to invest in this company's shares." Feng Yu rolled his eyes. If Feng Yu had invested in Enron, he would have lost everything.
Hmmm … maybe the courts will order Citigroup and other companies to compensate them, but the compensation will not be enough.
"I've already fired that agent! He only knows how to follow the crowd. If he is only so capable, why should I give him such a high commission? "Kirilenko was furious. The agents he hired are so much better than those hired by Feng Yu!
This time, Kirilenko and Kirilenko had borrowed Enron's shares from a securities company and dumped them. After some time, they will buy back the shares and only need to pay a small sum of money.
But the amount they can borrow from one share is not much. Although the profits are high, the overall profits are not high. But it is enough to cover their losses from dumping their tech shares.
As Feng Yu and Kirilenko chatted, Ralph knocked on the door and entered. "Boss, Enron had made a response. Their Chairman said what you said is slander, and they had never falsified any data. They had hired lawyers to send letters to you and CNN, demanding us to apologize and compensate for their losses. "
After this news was released, Enron's share prices rose slightly, and some of the listed contracts were settled. Now, the investors are split into two factions. One faction wants to sell their shares and accept their losses. The other faction would take the opportunity to dig in and wait for the next day to make a comeback and make a huge profit.
Kirilenko frowned. "They are too shameless. Didn't they respond to Benford's Law?"
Feng Yu laughed and waved his hand. "It's fine. I think the accounting firm that did the accounting for Enron will give us a reply soon."
Sure enough, the well-known accounting firm in the United States fired two senior accountants on the same day.
Feng Yu had just accused them of falsifying their accounts, and two of their accountants were fired. Who will believe they had nothing to do with the accounting firm?!
After this news was released, Enron's share prices plunged again.
"Feng, should we buy back our shares?" Kirilenko asked. They must return the borrowed shares.
Feng Yu shook his finger. "Don't be anxious. The share prices had only dropped a little today, and it will continue to drop tomorrow. I think this company's share prices might even drop below 1 USD. "
"How much? 1 USD? This morning, their share prices were more than 60 USD! "Kirilenko's eyes opened wide.
Feng Yu replied. So what if their share prices drop below 1 USD? This company might even go bankrupt.
"Nothing is impossible. Their company had falsified their accounts, and they will be punished by the law. The credit rating agency will lower Enron's credit rating, and it will be a fatal blow to Enron. Besides, think about it, why did we short sell Citigroup's shares? "
"You are saying Citibank will be implicated if Enron's scandal blows up?" If Citibank is implicated, it is not impossible for the share prices to plummet.
"Of course. Citibank is one of the most famous financial institutions on Wall Street, and they are one of the forces behind the dotcom bubble. They had invested in these companies and had made high profits. There is no concrete evidence, and it will not be a big blow to Citibank. But Citibank and Enron's accounts had been tampered with. How can they not know about this? "
Feng Yu is confident that Citibank will pay a heavy price for this!
… …
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