I’m not quite sure how to proceed. Some of you will recall that we went over this issue before, about Feckless Leader and his involvement with Harken Energy,etc. etc.
Part of that had to do with the mystery posed by an investment on the part of Harvard. This cite plays into the issue.
Now: should I cite the whole goddam magilla, that is, direct the innocent reader to plow through all that? Or shall we take it as a given that all respondents to this post are verterans of the Harken Affair?
Scylla? You out there? You dont want to miss this. There is a pefectly legitimate, innocent explanation.
PS: Who the hell is this Bob Abboud guy? He shows up everywhere! WTF.
What, are we supposed to read your mind and know where you stand on le affaire Harken, whatever it may be?
I don’t think it’s fair for you to post an OP that starts in the middle of a conversation you were evidently having with Scylla, in some other thread, without at least posting a link to the thread.
::*runs up to thread, drawing tools of combat from Liberal Backpack — calculator, slide rule, abacus, other weapons of math destruction, little red book, quotable Keynes, bust of FDR, Clinton bracelet — girding loins, stoking fires of moral outrage… looks wildly around for smoking gun while readying bile vial and acid retort…
scrrrrrEEEEEECHHH!!!*::
Aaaah… More crony capitalism and shady, hidden, dishonest but legal use of investor monies… And nothing incriminating.
Are we really ready to restart this thing?
::begins methodically holstering WMD’s, quenching F’s of MO…:: Luuucy; you got some ‘splainin’ to do!
Well, golly, fellows! Has the Clinton era ethical decline so warped our values that you don’t see anything amiss?
An “off the books” partnership that fruadulently inflates the value of Enron…oops, Harken…stock? One that "… serves as a partnership device to move money from Harvard to Harken. This is beyond nuts from an institutional investor’s standpoint.’’
One that has George’s fingerprints all over it?
“…The creation of the partnership was approved in a motion made by Bush…”
Wasn’t George whole defense based on his purported ignorance? That he was “out of the loop”? Please note that the SEC was not advised of this, because Harken was not legally impelled to do so. Seems to me this might have pushed them to a rather more thorough investigation, might it not?
Seems rather like a temporary stock “bubble” so that Certain Persons might sell out under “good news”, no?
Of course, on the other hand, Saddam is an evil, evil man.
Oh, gee, whats the word I’m looking for? Fraud? Yeah, that’s the one!
For what other purpose was this done? Does it fit with your ideas of proper business governance? If you had bought Harken stock at this point in time, wouldn’t you think you had recieved a jolly good rogering?
Scylla doesn’t this speak rather strongly against your previous thesis that George was an innocent bystander? I can well understand why you wouldn’t especially like to engage this issue. But a bland denial that anything is there is just plain weird.
Don’t think we didn’t notice that “weapons of math destruction” pun, Xeno! You will be called to account for that, if not in this world, then the next. Shame, sir! Shame!
BTW, elucidator, I appreciate your efforts, but those of us who do see the lousiness inherent in this latest revelation need no further convincing of Mr. Bush’s, shall we say, ethically-challenged nature. Those who were not convinced of that by Bush’s previously revealed histories with Harken Energy, the Texas Rangers and as Gov. of Texas will not be suddenly swayed by the Harvard deal.
I think a compelling argument that Bush is unacceptably beholden to certain business interests (and therefore unconvincing as a corporate informer) can be made from all available information (and actually was made in the referenced thread), but I haven’t the time to help you do it again, and your OP really doesn’t even get started along that path.
And what’s wrong with a little punishment among friends, eh?
I’m happy to engage, but you need to make an argument. I have no idea to chase you around for seven pages trying to figure out what it is that you think happened.
I’ll hit what you’ve said so far
Where’s the fraud?
That quote’s out of context from the article. In context what it is saying is saying that apparently Harvard made a stupid move.
I don’t follow you. Bush made a motion that brought in money and investment to Harken on favorable terms. This is bad because…?
No. There was no defense. There was no defense because there was no accusation. What there was was an investigation. The Investigation concluded that Bush was ignorant of the terms of the Aloha transaction, and the coming devaluation of Harken relative to the unwinding of that transaction. It did not conclude that he was generally ignorant of everything, and certainly didn’t imply that he was ignorant of processes in which he was instrumental.
This has nothing to do with Aloha. To those with acumen, it strengthens the proposition that Bush thought Harken was strong when he sold his stock.
Even if the timing coincides (and you will need to check,) one would expect him to want to sell when the stock is high. That’s the whole theory behind investing, you know?
Where? Who was defrauded? How? Why?
To make money.
I don’t know what it is you’re objecting to.
Absolutely not. In fact it is exactly the opposite. It is a huge boon to Harken stock that Bush brought in such an investment that reduced debt, did away with other debt and brought in significant management fees. In fact, it arguably saved the company from bankruptcy!
Would it be condescending to subscribe to your suggestion a few months ago that we phrase arguments as if to a two-year-old?
-Hiding your debt from people who in-vest in your com-pa-ny and telling them that you’re making money for them when you’re really not is a big fat lie.-
Those seven pages from this summer failed to convince you of any wrongdoing then, so I’m pretty sure my summation here won’t do it, either. After all, as William Black indicated in the article, “such a partnership was legal”.
Debt was not being hidden in the transaction between Harken and Harvard.
Harvard exchanged $ for ownership, reducing debt.
It was a particularly good transaction for Harken shareholders, specifically because it reduced debt.
You are flat out wrong, and misreading what the article plainly states.
Harvard took on assets and debt in return for majority ownership. On top of the cash Harken recieved upfront, it’s exposure to the remaining 20mm in debt was reduced to 3.2mm.
You guys have demonstrated a total ignorance of familiarity with GAAP, Securities laws, and Corporate Finance it, and compounded it with an innane political agenda.
The whole transaction is incredibly beneficial to Harken and it’s shareholders. That is the entire point.
Harken engages in a transaction with a third party wherein it gains $30 million in much needed cash, gets rid of $17.6 million in additional debt, and gains an $11.2 million dollar equity interest in a partnership, plus a lucrative annual management fee, all because of Dubya, and you two ignoramous claim he’s defrauding the investors in Harken?
Lord help me, may I be defrauded in such fashion just once! Just once!
Though you have demonstrated time and again that you are both completely ingorant and unqualified in this area that doesn’t excuse your current blunder as it’s a matter of simple addition to see who benefitted from the transaction, one that any 4th grader could compute.
Furthermore, in your rush to to judgement it seems that you completely missed the whole point of the article (though it itself is flawed.)
The question raised by the article is why Harvard engaged in what on the surface appears to be an extremely unfavorable and unusual transaction?
I’ll leave the answer to that question as an exercise for an astute reader (should one show up.)
Disregarding the amusing “total ignorance of familiarity” typosult and the “inane political agenda” canard, and since the toddler-sized explanation seems to have been insufficiently explicit…
According to the article, Harken had only a 16% interest in the partnership. Looking at the assets listed, this was entirely insufficient to actually cover the Harken debt (as opposed to merely hiding it). The article indicates that, during the resulting “bubble” in Harken stock value, the Harvard fund sold 1.6 million shares. I don’t know what value that stock had during this period, so I can’t say how this much these sales offset the $26 million in Harken drilling operations funded by the partnership plus the $20 million in Harken debt and liabilities that were transferred to the partnership.
[Reasonable Supposition]
Of course the Harken stake in the partnership was not entered into to be profitable to Harken, nor were the Harken assets transferred to the partnership intended to do anything but counterbalance the debt also transferred. This was a mock bail out at the expense of Harvard investors, and was designed purely to portray a healthier Harken than existed in reality.
[/Reasonable Supposition]
Looks like artificial inflation of stock prices to me, but, again, I’m sure it was legal.
But let me get to the heart of my beef with Mr. Bush. See, you can paint (and I believe I may have in the other thread) a believable portrait of G. W. Bush as a fairly competent, even cunning businessman; a “Fortunate Son” child of privelege whose arrogance and cupidity lead him to shade the truth and even outright lie in order to further schemes which he thinks will make him –and some shareholders, of course- a bunch of money. Not only is this portrait becoming extremely easy for me to believe, it’s entirely consistent with Bush’s big push to war with Iraq: lie like hell about Saddam’s capabilities and intentions so that you can justify a war you think is strategically advantageous.
Or, you can form another portrait of “Dubya” Bush, the slightly dim Presidential scion, a hired figurehead who breezes, with Magoo-like serendipity, through his association with unscrupulous partners, becoming personally enriched without personally succumbing to moral turpitude. This scenario strains credulity, but at least it is internally consistent.
However, any portrayal of our President as competent, aware and possessive of business acumen, director on Harken’s board, member of the audit committee, yet completely uninvolved and unaware of flim after flam going on around him is, well, unbelievable.
My objection to George W. Bush is not that he is not above an occassional untruth in the service of a higher objective. It is that his public actions (and those of his private actions which are known) are consistently beneath the high moral standards he would have us believe he maintains. George is not actually an honest and compassionate conservative. He just plays one at the polls.
