by Michael Bowen & r & & r & Enron: The Smartest Guys in the Room & r & & r & & lt;span class= "dropcap " & T & lt;/span & he Enron debacle was a case of mass hysteria: In Y2K, with the company's stock price exploding like a Texas oil rig set ablaze, no one thought to ask questions, and everyone acted like God.

After CEO Jeff Skilling came up with the idea of turning Enron into "a kind of stock market for natural gas, transforming energy into financial instruments," the company made a deal with Blockbuster and tried to expand into broadband. It failed, but no matter: Soon Enron was selling futures on the weather. It wasn't a company; it was a casino.

Under post-Reagan deregulation, everybody was too busy gambling to wonder how the chips kept flowing in. Wall Street analysts admitted they had no idea how Enron made its money, yet still slapped Buy ratings on the company's stock. When Skilling came up with the completely unrealistic concept of 'mark-to-market' accounting (which allows future profits to be booked on the day a deal is signed, not when and if anything of value is ever produced), Arthur Andersen and the FTC actually signed off on it. It wasn't just Enron, in other words -- there were bankers, lawyers, lots of people who knew that Enron was a sham.

There are enough extras on this disc to conduct a seminar on corporate excess, starting with Bethany McLean's Fortune articles, which first started asking questions. Skilling was condescending to McLean (who's young and fresh-faced), but she had the last laugh by turning Enron's motto, 'Ask why,' against the crooks themselves. Ironic stock footage (cliff jumpers for the stock's freefall), jokey soundtrack ("Son of a Preacher Man" for chairman Ken Lay's Baptist upbringing) and stock-ticker crawls enliven this documentary, a likely Oscar nominee, with a light touch. Director Alex Gibney clearly takes pride in his visual motif of reflective surfaces -- but his biggest scoop was unearthing taped phone conversations of predatory traders joking as they took down the California electric grid and jacked up their profits.

In the end, McLean expresses some compassion for Jeff Skilling ("he was devastated, his life destroyed") but adds, "I despise Ken Lay a lot more for his ability to just ... walk away."

Five years after selling off hundreds of millions of dollars in stock, now Skilling and Lay are walking into Houston courtrooms.

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