Even The Smart Money is Fallible

The more time you spend on the planet, the more you realize that even smart money is fallible.

Here is a graphic that is making the rounds on the web. Its a stock recommendation issued by Goldman Sachs on the now defunct Enron Corp.

In case you’re not familiar with Enron, here is the story. The Enron Corporation was an American energy, energy commodities, and related services company based in Houston, Texas. In 2001 Enron was shown to have committed institutionalized and systemic accounting fraud. Since known as the Enron scandal, the company’s name has become synonymous with willful corporate corruption. The scandal also brought widespread scrutiny of corporate accounting practices and was a strong factor in the 2002 Sarbanes-Oxley act. Enron’s fraud also lead to the dissolution of Arthur Anderson, which was Enron’s accounting firm.

The bottom line is: even the smart money is fallible. The highest paid analysts can and do make mistakes.

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James Hendrickson

James Hendrickson is an internet entrepreneur, blogging junky, hunter and personal finance geek. When he’s not lurking in coffee shops in Portland, Oregon, you’ll find him in the Pacific Northwest’s great outdoors. James has a masters degree in Sociology from the University of Maryland at College Park and a Bachelors degree on Sociology from Earlham College. He loves individual stocks, bonds and precious metals.