Possible Worldcom Scenarios

That network belongs in strong hands, and few others have the money and expertise. QWEST is in trouble, Verizon is trouble, so I would prefer SBC, Bell South, or a RBOC consortium to protect the public interest.

"SBC Communications Inc. today announced that Bell Canada Holdings Inc. has repurchased from an SBC subsidiary a portion of SBC's interest in Bell Canada Holdings Inc. for approximately US$870 million."

Possibly freeing up some cash and salivating?

These are telecommunications giants falling like dominoes. I wonder at what point the President might consider it necessary to nationalize the sector as a matter of national security. Who is next to fall?

Qwest is in trouble....

And today Xerox also popped up and said that "whoopsie, we've miscalculated earnings by 2 billion dollars" Which the wall street journal is reporting is more like 6 billion.

Will all these scandals result in an "age of honesty" in business? Or will they just be more sly with their books?

I believe nationalization is only a quick fix. If you think companies like Verizon, Qwest, and Worldcom are monolithic organization multiply thatby a factor 100. That would be the kind of backward thinking ineffecient organization we would have. That is not an attractive picture to me. Let these companies go bankrupt, there is plenty of capacity to go around. Sure some companies might be left in the lurch, but it would only be the ones who do not have a diversified connectivity. These operations can then be picked up for penny's on the dollar of the orginal costs. That isn't necessarily a loss of value in my mind, we have to remember these companies built these networks during extravagent times and the costs of these networks include all of these high fliers extravagent consulting fees. This is pure and simple mismanagement and customers, employees, and investors will suffer. That is risk the risk of working for a company, that is the risk of being a customer of a company, that is the risk of being an investor. Nothing guaranteed, life isn't fair, the only thing you can do is move on and learn from the mistakes.

Next to fall maybe its a supplier like good old Nortel they liked worldcom bunches.

Much of this problem is in the funky equipment financing scenarios Worldcom equipment goes back to probably to the Lucent and Nortel equipment they had.
" Those equipment deals worked out to 12.5 to 17% intrest"

Nationailization So you wanna build a new AMTRAK??AT&T

No Way Jose!!

Who is next?

Quest? if any baby bell VZ and SBC have a cleaner slate.

Genuity so Verizon gets it back they do not need UUNET?

Cogent? Still has allied risers burn plus it own

Yipes? its flickering in Chapter 11 land

Man that cash ($KAching$) can burn better than broadband

[text was edited by author 2002-06-28 14:35:46]

Never thought I would see the day when this was the best of the bunch when it comes to big telecoms. It is truly a sign of the times.

said by akristov:

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That is risk the risk of working for a company, that is the risk of being a customer of a company, that is the risk of being an investor. Nothing guaranteed, life isn't fair, the only thing you can do is move on and learn from the mistakes.

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Yes, well while you're beating your individualistic chest on this, billions of dollars are changing hands, most of which are changing illegally through lies, deception, and outright thuggery IMHO. Are we supposed to chalk it up to experience that a few greedy idiots are screwing up everything for all of those unfortunates that either work or invest in WorldComm?? What about their customers?

"Life isn't fair" doesn't cut it. You've got a couple of thieves at the top who walk away unscathed with millions in the bank, and all you've got is more Chicken Soup for the Soul??? What's next? Are you going to suggest we "suck it up"?????!?

No sh*t there's no guarantees in life. But when the very rich urinate all over everyone else in the name of greed, one starts to wonder where our government is, when they are supposed to be protecting us from this kind of crap.

P.S. Did your ancestors vote for Herbert Hoover? Just wondering...

said by nc1165:

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I wonder at what point the President might consider it necessary to nationalize the sector as a matter of national security.

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That is the worst option. Just ask the customers of nationalized phone companies in any country outside of the USA. Last time I was in Greece, for example, calling the USA for 3 minutes cost $40 using OTE (the Greek state-run phone company)... thankfully I had an AT&T phone card (although any phone card from a US phone company will save you lots if you travel abroad).

I'm not really espousing it as an idea, per se. I'm just wondering out loud if it will be seen as an option or has been discussed around the big table on Pennsylvania Ave. If the government had ever wanted to do this, I think they may have the perfect excuse. Remember, some of these companies have government contracts.

said by garagerock:

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"Life isn't fair" doesn't cut it.

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But its true, life isn't fair, it will never be fair. There is no sense in trying to have the government make life fair when life in itself is not fair. Its like asking the government to make the sun revolve around the Earth. It is not going to work. All of the government's attempts at "levelling the playing field" have created generations of people who must suck off the government teat just to survive. If they were in any other country, they would starve to death.

On the other hand, I am totally with the other poster who mentioned Amtrak. There is no way government could possibly manage something as complex as telecom.

I honestly think that these accounting shenanigans have been going on for years, and only now are the perpetrators finally being caught. Maybe its because now laws are being enforced? Who knows.

All of these execs are truly my hero's. Enron, Worldcom, etc... Bleed the company dry, walk away with a multi-million dollar parachute and layoff all the poor saps that made you rich. I want to be just like them...

God bless each and every white collar criminal.

said by nc1165:

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the government had ever wanted to do this, I think they may have the perfect excuse. Remember, some of these companies have government contracts.

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That is indeed the case, but in order for the government to do this (I don't even think it would be legal), the only possible excuse would be that the public good would be better served, and then we would have to cough up the money to justly compensate the shareholders of these companies. When Bell Telephone began in the late 1800s, there was much talk about nationalizing it under the Post Office, but this was later abandoned.

And a shrimp boat captain like myself loves peeling your skin and remainder of your pocketbook off slowly in your next deal.

And they are easier than some of these North Dallas, Texas chicks!!

i agree that life won't ever be fair, but there are laws in place right now that are supposed to protect investors, customers, and employees from fraud by executives.

saying "oh well, life just isn't fair" doesn't excuse the fact that laws were broken - by executives, by the accounting firms - and whether someone actually TAKES RESPONSIBILITY for it is where the question of fairness comes into play.

I didn't say the government did not need to be involved in prosecuting these individuals to the fullest extent of the law and returning the funds that they ciphoned off as stock options. Unfortunately I think that would take longer and require more cooperation from with in different of the government entities than it would take to privatize the telecom industry.

I am curious the spin that's put on this. Look everybody, most people that come here are pretty smart. The problem? DEREGULATION !!! yeah that's right. deregulate everything and it's the free open market place and you have top management screwing people like us. Well I'm getting pretty sick of it. Apparently the company Cheney was running is in big trouble and his hands are dirty. we never see or hear from him cause he's trying to hide his end. DEREGULATION killed the airline industry, not the communication and telephone industries, all of it. they should of left it alone and it has to go back to that because the rich people are bastards who can't be trusted. the proof is in everyones face.

hey dude, no fuc**** way. the ones responsible better start getting arrested or you're going to have another revolution in this country. I am FU****G sick of this crap of the slick talking creep stealing millions and nothing at all happens when thousands of families and lives are ruined. Damnit I swear I am ready to go into the streets over this crap. I mean it. it's going to pop soon. AKRISTOV I can't believe you honestly feel that way. you better not, that's life, PEOPLE GET ROBBED??? No Way. I vote and I write letters. if people started writing or calling their representatives in the House they would get scared and finally do something. God this makes me angry
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There should be a new Elton John song - "Bernie and the Jerks" - for what those %*$)*$%#$ have done as the lights dim today at WCOM/UUNET offices for so many honest, hardworking employees.

Here's some more fallout - - -

Marc Humbert, Associated Press, 6/28/2002

"ALBANY - New York's state pension fund, the second largest in the nation, has lost about $300 million in value due to its WorldCom investments, the worst single loss in the fund's history, state aides said Thursday.

New York Comptroller H. Carl McCall, the trustee of the $112 billions state pension fund, said its private money managers were duped by the communications giant. He said he was considering seeking lead plaintiff status in any court action against the corporation.

New York isn't alone. The California Public Employees Retirement System, the nation's largest, has about 23 million shares of WorldCom stock, as well as bonds linked to WorldCom. The estimated total loss if it were to sell those holdings today: $565 million.

In Ohio the state pension fund faced $206 million in unrealized losses, while its teachers retirement fund stood to lose more than $100 million. The Kentucky teachers’ retirement fund faced unrealized losses of $42 million, but there were no plans to dump the stock.

n Michigan, where the pension fund is worth about $45 billion, state officials reported an unrealized loss of about $116 million on WorldCom. Florida's $90 billion state pension fund, already hobbled by an estimated $300 million loss on Enron stock, lost between $85 million and $90 million, Florida officials said.

The New York state pension fund has sustained some major losses over the past year, including $75 million on Global Crossing investments; $58 million on Enron; and about $5 million on Adelphia Communications. Nevada's pension fund was nearly alone in having no WorldCom stock."

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The behavior and greed of a few select individuals at companies like WorldCom, Enron, Adelphia, Global Crossing et al has caused heartache for thousands and thousands of decent, hardworking, mortgage-paying families. Shame on all of you!

Is is farther to California or by bus?

said by rit56:

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hey dude, no fuc**** way..... I am FU****G sick of this crap of the slick talking white cracker creep stealing millions and nothing at all happens when thousands of families and lives are ruined.

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So you're trying to make this into a racist issue too? I don't think someone stealing and lying has anything to do with the color of their skin..

grow up.

This is stupid. Why on earth are state funds even allowed to invest in private stocks when they have no incentive to make good picks? These governments don't care, they will just raise my taxes to make up for the losses. If anything should come out of this scandal, it should be that no tax money whatsoever should go anywhere near the stock market. Return that money to the investors themselves so they can decide if the risk is worth it or not.

Better yet, to cover the losses, reduce the amounts that these pensions pay out, and increase the dues charged to state employees to use the system, so that they have an incentive to not choose fund managers that make these kinds of foolish investments. That is how things work out here in the real world of investing. As a tax payer who can barely save for my own retirement, I am sick and tired of having to bail out bureaucrats who should not be touching my money in the first place.

Same old thing as yesterday Jethrogump said Pensions funds are the final dupe in the con-game for the fund advisors and securty brokers and capital markets.

Its nothin new it happens on every new thing. Real Estate 1980, Junk Bonds 1990 Dot.Bomb 2000

Why the money just pours in from contributions and good projects and must be allocated a % to real estate, stocks, bonds and venture capital. Its the MONEY TREE for all the scammers when a topic like telecom is hot hot hot!!

Its apparent you have been watching too much WORLD WRESTLING FEDERATION your acting like Booga T!!

So do you get this off base from eating TV Dinners or doing the spinaroonie!!

Please take some economics courses and history this has happened before we survive, we invenst and actually get better.

Da YA SMELL What I am Cookin!!!

said by Leviathan:

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.Will all these scandals result in an "age of honesty" in business? Or will they just be more sly with their books?

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An "age of honesty" is unlikely without an "age of scrutiny", and penalties to discourage potential miscreants. Business people are as honest as other people, they just have more opportunities to mis-behave.

said by rit56:

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hey dude, no fuc**** way. the ones responsible better start getting arrested or you're going to have another revolution in this country....... I vote and I write letters. if people started writing or calling their representatives in the House they would get scared and finally do something. God this makes me angry

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It makes me angry too, and social unrest is a distinct possibility if people lose faith in the system. I've had close ties to the financial sector since the mid-sixties, and this is by far the worst era of fraud in my lifetime.

I don't see your post as racism, as many key players like Phil Graham are "crackers". WCOM is headquartered in Mississippi, Enron is from Houston, as are other key players in the the California power fraud. The "new right" is primarily a southern conservative voting bloc, George Bush & much of his cabinet are WASPS from Texas.

That isn't meant to disparage Texas, the deep south, or conservatives in general, but this age of greed and corruption didn't spring from northern liberals and minorities, it's dominated by white male southern conservatives.

said by nc1165:

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These are telecommunications giants falling like dominoes. I wonder at what point the President might consider it necessary to nationalize the sector as a matter of national security.

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Nationalization is not a sensible option, Capitalism works, but not without some sensible regulation. We had that, until the new right de-regulation proponents undermined it. This is as much a political fraud as a business fraud. These huge endeavors involve hundreds of players in business , and government, from both parties.

a poor choice of words I suppose. thanks Pupowski for being intelligent. sorry everyone else but rich white southerners are behind all of this. smell that one buddy. prove it otherwise. where are the rich white conservatives that went after Clinton? using your pecker is a terrible offense but stealing hundreds of millions of dollars from everyone is ok. why aren't they making a lot of noise now? because they have the same interests as the robber barons? really why aren't they making a big stink about these corporations going belly up? if Clinton were still in office I just can't imagine what they would be doing. they are saying nothing because the paper trail leads right up to the Republican National Convention maybe? prove they are not involved. lets see what you have to say when the trail leads right up to Cheney's door. Be careful Mr. Vice President. you could make it a lot worse by trying to hard to cut yourself free of the inevitable.

"I don't see your post as racism"

Then you were reading it with your typically biased eye.

"That isn't meant to disparage Texas, the deep south, or conservatives in general, but this age of greed and corruption didn't spring from northern liberals and minorities, it's dominated by white male southern conservatives."

At least tell the whole story if you intend on bashing a group of people. The "age of fraud" you speak of came about during the crooked Clinton years.....things didn't just go downhill in November of 2000. I saw one of your posts affirming this fact, so I'm not sure why you didn't include it here.

Corruption and greed, you say? Sounds like an apt description of the Clinton administration, which is as liberal as they come. Southern white male Conservatives? This issue transcends party and ideological boundaries. The birth of moral dearth in this great country of ours was sprung from the liberal 1960's, and heavily propulgated in the Clinton 90's. The "Me Generation" I often see you ranting about (and for good reason) was born of liberal ideology, not of the Conservative forces opposing it.

Please don't let your bias and personal hatred of the Bush camp and all things Conservative interfere with the facts......corruption was, is, and always will be something that crosses party lines and ideologies.

said by CFeicht:

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The "age of fraud" you speak of came about during the crooked Clinton years.....things didn't just go downhill in November of 2000.

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Teapot Dome Scandal - Warren Harding, circa 1921
Watergate - Richard Nixon, circa 1972
Iran-Contra - Ronald Reagan, circa 1988
Abscam - various senators from both parties, circa 1980

The Age of Fraud has been peppered across our entire history. Focusing on one administration's "pitfalls"(read: we didn't like what they did!) seems like you're focusing on one grain of sand on a beach...

And, let's review the "crooked Clinton years", shall we?
Balanced Budget
Historical Economic Growth
9 years of relative peace in the world
Historical changes in racial justice issues

said by CFeicht:

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The birth of moral dearth in this great country of ours was sprung from the liberal 1960's, and heavily propulgated in the Clinton 90's.

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Maybe, if for one second, you actually had your own opinion and didn't regurgitate Rush Limbaugh's mantra for "conservative" living, I might have something to rebut this with.

Unfortunately, you and that whole flock of mouth-breathing sheep that keeps harping on the '60s sound exactly like the hippies do-give it a rest, alright? That decade ended thirty years ago! Those battles have been fought, re-fought, re-hashed, and it got old back in the '80s when Family Ties even had Alex fighting his dad on these very same tired old arguments.

So one President got caught getting his knob polished? Big f*cking deal. Whitewater? 50 million wasted dollars later, no prosecutions. Whoopee!

Speaking of re-hashing, this battle smacks of Hillary bashing 9 years ago.

You end with a good one, though:

said by CFeicht:

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corruption was, is, and always will be something that crosses party lines and ideologies

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Indeed. That's where we agree - corruption is blind to any of our designations.

How is Verizon in trouble?