ABSTRACT
Ironically, while the full disclosure system was being circumvented by nearly every market participant during the 1990s, the country was experiencing unprecedented prosperity. Despite the collapse of the stock market, and in the face of Alan Greenspan’s crippling interest rate increases, a terrorist attack of previously unimaginable magnitude, wars in Afghanistan and Iraq, and numerous financial scandals, the recession associated with those events turned out to be perhaps the mildest ever. Insurance premiums for director and officer liability jumped significantly. Enron’s bankruptcy and credit problems at other large companies caused a squeeze on commercial paper issuers, shrinking the size of that market by hundreds of billions of dollars. Energy prices fell dramatically in the fourth quarter of 2001 as a result of increased production and favorable weather conditions in the United States.
