Ted,

Question 1)  The investments in CALME and APACHI are booked on an accrual 
basis.  I have had several meetings with Commercial and Accounting   
representatives over the last year and all have stated that any earnings are 
effectively reinvested back into the Assets.  Therefore, the   Market Values 
that are reflected on the MPR are actually Book Values.  The Book Values are 
typically adjusted the last week of the month   and are 1 month behind as the 
Internation groups wait until the GL is closed before communicating the 
updated values.

Question 2)  Thanks for the heads-up on India.  I spoke with Sheila Glover 
and we are now aware of the details behind Rediff.com.  We need to ensure   
that these positions are not accounted for on the DPR by India so that we do 
not double-report the P&L.  The long-term solution is to   establish a 
communication line for future investments.  Between Sheila, Donna Lowry, and 
I we can develop a plan.  

Question 3)  The 3 bonds that you are referencing were purchased by Jeff 
Kinneman for Jim Easter.  During our last conversation, Jim told Jeff that 
these   are Strategic investments and should not be reflected on the MPR.


There is still some uncertainty/confusion as to when an investment is 
classified as Merchant.  We could insist that all publically traded 
investments not included in the Equity books would qualify.  Having said 
that, I would like to know if the Gas Authority of India, Ltd (GAIL) and 
Europe's investment in MG are considered to be Merchant investments.

I will be on vacation this Friday and all of next week so please include 
David Maxwell on any responses.  David and I will stay in touch so as to make 
adjustments as needed.

Thanks,
Todd


   


From:  Ted Murphy                                                             
06/22/2000 03:07 PM	
	
	
	                           
	

To: D Todd Hall/HOU/ECT@ECT
cc: Sally Beck/HOU/ECT@ECT, Rick Buy 
Subject: Re: MPR for 6/20/00  

Mr. Hall,
I have just reviewed the Merchant Portfolio Summary for 6/20 and have the 
following questions:
 1) CALME shows an asset of $291.9MM  and APACHI shows an asset of $113.0MM 
and they show no p&l for the year
  Is this possible in a world of changing interest rates and equity premiums 
and commodity prices?
 2) India recently invested in an IPO (rediff.com) for which there was a 
simultaneous DASH to buy and sell (sounds like a Merchant deal).
  Where does this show up?
 3) There are several bonds (publicly traded, registrered securities, housed 
in our Prime Broker accounts) owned by various Enron entities
  that I do not believe are on the DPR.  Shouldn't they be? And if so, who is 
deciding not to include?
Pls advise at your earliest convenience as you always do.
Thanks
Ted


   
	
	
	From:  D Todd Hall                           06/21/2000 01:16 PM
	

To: Rick Buy/HOU/ECT@ECT, Andrea V Reed/HOU/ECT@ECT, Sally Beck/HOU/ECT@ECT, 
Ted Murphy/HOU/ECT@ECT, Richard Causey/Corp/Enron@ENRON, Carol Jean 
Marshall/HOU/ECT@ECT, Raymond Bowen/HOU/ECT@ECT, Jeff 
Skilling/Corp/Enron@ENRON, Jeff Donahue/HOU/ECT@ECT, L'Sheryl 
Hudson/HOU/ECT@ECT, Monica Reasoner/HOU/ECT@ECT, Hope Vargas/HOU/ECT@ECT, 
Adarsh Vakharia/HOU/ECT@ECT, Joseph W Sutton@Enron, Michael S 
Galvan/HOU/ECT@ECT, Maria LeBeau/HOU/ECT@ECT, Wes Colwell/HOU/ECT@ECT, Mark 
Frevert/NA/Enron@Enron, Thomas Myers/HOU/ECT@ECT
cc:  
Subject: MPR for 6/20/00