Enron Stock Nearly Worthless and its Multi-Billion Dollar Merger Deal with Dynegy Off.
ANNOUNCER: This is LOU DOBBS MONEYLINE for Wednesday, November 28. Here now, Lou Dobbs.</s>LOU DOBBS, CNN ANCHOR: Good evening everyone. The United States continues to strike at the Taliban and al Qaeda network in Afghanistan. U.S. warplanes bombing leadership targets, more U.S. forces have arrived in the country. And the first American has died in combat in Afghanistan. We'll have those stories for you and a live report from Afghanistan. We'll also be going live to Bonn, Germany. Talks there to form a post-Taliban government continuing, but they are facing new problems in reaching a conclusion. Then, a sobering assessment of Osama bin Laden and nuclear weapons. Bin Laden may not have a nuclear bomb, but what he does have may be equally disturbing. We'll have that report for you. And also tonight, Enron once an energy success, now its future in doubt. Its stock nearly worthless tonight and its multi-billion dollar merger deal with Dynegy is off. We'll tell you what happened to Enron and what it means. The collapse of the Enron-Dynegy deal reverberated through Wall Street today, stock prices sharply lower. Turning now to the latest developments in the war against the Taliban and al Qaeda terrorists: A CIA officer has been killed, killed during the prison uprising near Mazar-e-Sharif. Johnny Spann was gathering intelligence from Taliban prisoners when he was killed. His is the first U.S. combat related death in Afghanistan. The Pentagon says pressure is building against the Taliban and al Qaeda and that troops are becoming increasingly disorganized. Yesterday, U.S. fighter jets hit a Taliban complex near Kandahar. That complex was believed to house Taliban leaders. Two of the largest Afghan delegations at a conference near Bonn, Germany have agreed to a transitional council. It would oversee setting up an interim government. But differences remain over who would make up a security force to oversee Kabul. U.S. officials tell CNN that speculation about taking the war against terrorism to Iraq is premature. Officials say the focus remains on Afghanistan and will remain there for some time to come. Meanwhile, British and American aircraft monitoring Iraq's southern no-fly zone today struck a command and control system. The U.S. central command says it was in response to hostile Iraqi threats against coalition aircraft. A top Taliban official denies that U.S. air strikes hit a Taliban leadership compound and says their spiritual leader, Mullah Mohammed Omar, remains alive and safe. For more now on this and the fighting in Afghanistan, Christiane Amanpour in Kabul -- Christiane.</s>CHRISTIANE AMANPOUR, CNN CORRESPONDENT: Lou, indeed, the top Taliban official is the representative to Pakistan. It's not clear whether this is confirmed and, of course, we don't have a way of independently confirming this. But he has said after the U.S. said it bombed a leadership compound, that Taliban leader Mullah Omar was -- quote -- "safe and sound" and that indeed a leadership compound was not hit. Again, we can not confirm these claims. He also said that Osama bin Laden was not anymore under Taliban control, in other words, not in any territory under Taliban control. This conflicts with what people here in Kabul, the government of the Northern Alliance here in Kabul believe, that Osama bin Laden must be somewhere in the territory that is still controlled by the Taliban, that shrinking territory. And they believe it is around the Kandahar region. Now at the same time, the United States beefed up the number of U.S. Marines in the Kandahar region. We're told there is some 800 U.S. Marines on the ground there now and also continued air strikes around the region there in Kandahar. We're told that the focus of the last couple of days of air raids have been on leadership and command and control and the chain of command target for the Taliban and the al Qaeda network. In the meantime, at Spin Boldak, which is a key Taliban controlled town on the border with Pakistan, there has been a couple of days of wrangling there as the Taliban has apparently offered to surrender. But there is an argument between two Pashtun tribal groups there over who will take control of the area once the Taliban does surrender. So that is the situation in the south of Afghanistan at the moment as the hunt goes on for Taliban and al Qaeda leadership targets -- Lou.</s>DOBBS: Christiane, tonight we really have no better sense of where Osama bin Laden may be hiding than at any time previous in this conflict, right?</s>AMANPOUR: Yes, I mean, for us it's been a matter of speculation. You know, we hear these eyewitness accounts, sometimes throughout this conflict, that he's been seen here or he's been seen there. But it's very, very difficult and of course, as you know, there are no journalists allowed in the Kandahar region either with the Taliban or indeed with the U.S. forces. There is a very small pool that report of journalists there. But it's very hard to get a good grip on what's going on. And, of course, in these situations, the world's most hunted man -- it's pretty difficult to get a grip on exactly where he may be. But, of course, the U.S. and the others have extremely sensitive technology, heat-seeking technology and all the rest of it. So they would have the best way of knowing.</s>DOBBS: OK. Christiane Amanpour from Kabul, thank you. More U.S. troops are on the ground in Afghanistan tonight. The 10th Mountain Division, a quick reaction force, has been moved to an airfield near Mazar-e-Sharif. Jamie McIntyre at the Pentagon with more on the story -- Jamie.</s>JAMIE MCINTYRE, CNN MILITARY AFFAIRS CORRESPONDENT: Well, Lou, today the Pentagon released some videotape showing the strikes yesterday that were precipitated by an intelligence report that indicated that senior that indicated senior Taliban leaders, including perhaps Mohammed Omar, were at a complex southeast of Kandahar. Video from a U.S. Air Force F-16 shows a shower of satellite- guided, 2,000 pound bombs dropped from a single B-1 bomber destroying the compound southeast of Kandahar. But by morning, after this morning, Taliban officials were insisting that Omar was safe in Kandahar. The Pentagon says, nevertheless, it will continue to keep the pressure on leadership targets.</s>REAR ADMIRAL JOHN STUFFLEBEEM, PENTAGON SPOKESMAN: If we break the leadership of the Taliban and break the leadership of al Qaeda, there is very -- or there is reduced emphasis or reduced motivation for troops to stay loyal to the cause and continue to fight. There will always be pockets who are going to fight to death in any case. But, getting the key leadership and breaking the chain of command is going to render much of that ineffective. And so, therefore, the pressure is on that leadership.</s>MCINTYRE: Meanwhile, the Marines continue to bring in some troops and equipment southwest of Kandahar. And the U.S. is flying more than 100 combat missions a day, although many, if not, most of the planes have to return to base without dropping their bombs, an indication that good targets are being harder to fine. And as you mentioned, Lou, the U.S. is increasing its presence of ground troops on the ground, but just modestly. The United States has moved a handful of soldiers from the 10th Mountain Division from Uzbekistan to the airport at Mazar-e-Sharif. Pentagon sources say the two dozen or so soldiers will provide security at the airfield while the U.S. presses other countries to pick up the pace of humanitarian relief -- Lou.</s>DOBBS: Jamie, turning to the strike against the leadership compound last night, the story which you broke here on CNN last evening. Is it simply that we have to wait for confirmation by ground forces there? And how close are U.S. military forces on the ground to the leadership compound that was struck?</s>MCINTYRE: Well, they are not going to be sending any troops in to inspect that facility. They will be relying on other means of intelligence to figure out exactly what happened there. You know, the intelligence that they had that indicated Mullah Omar might possibly be there was never anything that firm. They said that today that they always hoped that he would be there. They didn't necessarily assume he would be there. And they will just continue to hit leadership targets. If he is, in fact, killed in one of these air strikes, the U.S. expects to find out through a variety of sources on the ground through their regular intelligence network.</s>DOBBS: OK, Jamie, thank you very much. Jamie McIntyre, military affairs correspondent tonight from the Pentagon. Talks on forming a new government in Afghanistan reportedly are going well. But today, an indication of the challenges that face those negotiating a post-Taliban government. The Northern Alliance doesn't want to use an outside, multi-national security force. Instead, they want their own troops to do the job. Jim Bittermann is in Bonn, Germany where those talks are being held and brings us up to date now -- Jim.</s>JIM BITTERMAN, CNN CORRESPONDENT: Lou, there was a small breakthrough today at the talks here. The two largest delegations, the Northern Alliance and the supporters of the former king, agreed on a method for getting government going in Afghanistan. What they have decided is to set up a transitional council of about 120 to 200 prominent Afghans who would sit on this council and then eventually choose an interim government. They have already got a joint commission going, taking a look at who should be on the council. And they hope to have the names of that council decided before they leave the conference site here in the next day or two. But there's a hang up and that's the hang up you mentioned. And that's security. Basically, the supporters of the former king say that since the Northern Alliance control Kabul, that that would not be a place where the transitional council could sit in safety. And so they are thinking that an international force should be brought in to provide some kind of a neutral zone for the transitional council to meet in. The Northern Alliance, on the other hand at a news conference early in the day, said that was totally unnecessary. Here's the way they put it.</s>YUNIS QANOONI, INTERIOR MINISTER, NORTHERN ALLIANCE (through translator): We don't feel the need for an outside peacekeeping force. And at the moment there is full security in place. If there is need for extra security, then of course we can have combined forces from the ethnic groups inside Afghanistan.</s>BITTERMAN: So, for the moment, Lou, it looks like they are going to put off that security issue, looks like it could be a divisive one -- Lou.</s>DOBBS: And, Jim, the role of the United Nations here -- is the United Nations strongly suggesting a role for U.N. troops within, certainly, Kabul?</s>BITTERMAN: What they're talking about, actually, is an international peace force. They would rather not have the U.N. blue helmets trying to do this one. They would like to have some kind of multi-national force of the sort that has been set up in Kosovo, a heavily armed force, different governments involved, that sort of thing, a real armies in there which would patrol the streets. That's what the U.N. is pressing for. They say that an all Afghan force might be a little premature, trying to get something that will represent all the ethnic groups of Afghanistan together in one military force. Might be a little tricky right now.</s>DOBBS: A likely role, Jim, for Russian and U.S. troops?</s>BITTERMAN: Well, it could be Russian-U.S. I think they're thinking also of some Muslim troops, perhaps Turkey and Jordan, countries that have already stepped forward and volunteered. So, I think that they try to make it as Islamic as possible in order to calm the fears there might be in Afghanistan -- Lou.</s>DOBBS: OK, Jim, thank you very much. Jim Bitterman reporting from Bonn -- thank you. Hundreds of people are being detained by the United States government as part of its investigation of terrorism. Critics say the Bush administration is overstepping its legal bounds. But officials say the tactics are necessary to stop terrorism. Eileen O'Connor joins us now from Washington with more -- Eileen.</s>EILEEN O'CONNOR, CNN NATIONAL CORRESPONDENT: Well, Lou, there are 104 people in total that have been charged with federal offenses. Now the charges run a full gambit, but few seem to show direct involvement in the conspiracy to commit the attacks of September 11. Some are charged with making false statements to a grand jury, others for the unlawful production of identification documents. Others are being held on credit card fraud, some on passport and visa fraud. About 20 people were charged with obtaining fraudulent hazmat licenses. Now, that happened in Pennsylvania, but it appears to have happened well before the attacks. Despite concerns that al Qaeda was planning to use trucks of hazardous materials to stage some kind of attack. These men, though, do not seem related. Still, there was a plan for them to get these hazmat trucking licenses without the training or documents. Now, in addition, you have some who have appeared in court, like Louise Martinez Flores and three others Salvadoreans who helped some of the hijackers here obtain Virginia driver's licenses. But this looks like a scam that the Salvadoreans, at least, engaged in with a lot of people hanging out at the department of motor vehicles and offering to vouch for people's residency in exchange for money. Then there are people like the man you see here, Osama Awadallah, accused of lying to a grand jury. Awadallah is a student, a permanent U.S. resident. He lived in San Diego. He's a student who, police say, knew two of the hijackers while they were in San Diego. And they say Awadallah lied to investigators about knowing those hijackers. A judge now says there's no real evidence linking him to the activities of the hijackers relating to September 11. So he is going to be released on bond. But, there are some who have been caught in this dragnet who may be more ominous. One man in New York is held on illegal possession of firearms. But he also, according to affidavits filed, took pictures of the World Trade Center before the attack and also had a handheld, global positioning satellite and showed some interest in nuclear facilities. Now all of this, the people being held under these visa violations, as you mentioned at the beginning, and these arrests on seemingly unrelated charges remind some legal experts of the way the Justice Department once got some major crime figures, organized crime figures, not through murder charges, but through charges like tax evasion. And, you know, you have the attorney general yesterday saying we are going to use everything we have at our disposal within the criminal justice system to hold those we suspect of any involvement or even unwittingly helping the hijackers -- Lou.</s>DOBBS: Eileen, these critics right now of some of these tactics being employed, is there any sign that John Ashcroft, the president, this administration are in any way considering changing approach?</s>O'CONNOR: No, they aren't, although some people said that the release of a lot of this information, the documents -- the charging documents -- we had about 40 of those documents. But a lot them were given to us today by the Justice Department and, at least, releasing the countries, not the names of those detained under INS violations -- all of that information, a lot of people think, that that is in part an answer to the critics. So while they are not really changing the way they're doing business, they are at least being a little bit more transparent about what is going on. And the attorney general, you know, yesterday came really out with no apologies to anyone about what he doing. He said, this is a time of war and any information that they are withholding is because, he says, this is a country at war -- Lou.</s>DOBBS: And, Eileen, an extraordinary development -- William Webster -- eight including William Webster, former director of the FBI, criticizing some of the FBI tactics here which, if nothing else, have been effective to this point because we haven't had another incident since the 11th. What's the reaction that the Justice Department to that sort of criticism, if you will, from brothers in war here?</s>O'CONNOR: Well, you know, they are saying -- and the FBI director, Robert Mueller says -- look, he felt that this is now a new world. And the -- as you've heard the attorney general as well say the mission now of the FBI is to prevent terrorism. And what they have been very good at doing is investigating things after the fact. So -- and what the critics are saying is that it's if they are trying to rebuild the FBI. And I think you'll hear Robert Mueller saying, yes, you're right. We are trying to rebuild the FBI because we think that the mission is having to shift post-September 11 to one very much of prevention, not just investigation after the fact -- Lou.</s>DOBBS: The FBI director has a lot of evidence on his side as well as support. Eileen O'Connor, thank you very much for bringing us up to date. Does Osama bin Laden have a nuclear weapon? A special House task force on non-proliferation received a sobering assessment today. Osama bin Laden may not have a nuclear bomb yet. But what he does have could be devastating. Steve Young has the report -- Steve.</s>STEVE YOUNG, CNN CORRESPONDENT: That's exactly right, Lou. The former CIA director's judgment is that Osama bin Laden probably doesn't yet have the bomb, but he almost certainly has some of the piece parts, at least, for a dirty bomb. Late this afternoon, James Woolsey told a bipartisan group of congressman a lot of attention has properly been paid to nuclear materials getting into al Qaeda's hands from Russia. .</s>JAMES WOOLSEY, FORMER CIA DIRECTOR: There has to be said to be some possibility that a few kilograms of plutonium or highly enriched uranium in one way or another through organized crime circles into terrorist circles have made their way into al Qaeda's hands.</s>YOUNG: He doesn't believe bin Laden has an atomic bomb that would leave a mushroom cloud, but he thinks the terrorist could combine radioactive materials with conventional explosives. That's the makings of a so-called dirty bomb that could shower a wide population and cause tens of thousands, even hundreds of thousands, of excess cancers. Britain's defense minister, Geoff Hoon, by the way, recently said he's reached the same conclusion. He told the BBC bin Laden is a man with no scruples, no morality, nor reservations about killing civilians to achieve his perverted ends -- unquote. Woolsey says he believes the greatest potential source of radioactive materials for al Qaeda today is Pakistan, which is widely believed to have to makings of up to 45 medium-yield bombs. Let's put that in perspective. The 1993 World Trade Center terrorist attack wreaked its devastation with 1,200 pounds of explosives. Even a crude, small nuclear bomb would be at least a thousand times more powerful. And a medium-yield bomb would be far more powerful than the bomb the U.S. dropped on Hiroshima. Woolsey says Islamabad's bombs are kept in component parts that Pakistani fanatics might collaborate with al Qaeda but it would be hard to put the parts together in an Afghan cave. Of course, Osama bin Laden has been talking about obtaining a nuclear weapon since 1993. al Qaeda has cells in 60 countries, so an Afghan cave wouldn't necessarily have to be the assembly point? Woolsey also said the Bush administration should make available American bolts, censors, tamper-proof seals to identify, track and secure Islamabad's nuclear materials and he thinks the U.S. has to target Iraqi's state support of terrorism early in the new year -- Lou.</s>DOBBS: And what is the likelihood that Pakistan will accept those preventative measures?</s>YOUNG: Certainly some resistance -- interesting too in what Woolsey said. He says go after Iraq, but not Iran. Interestingly, he says, half the population of that country is now 21 years old or younger.</s>DOBBS: That country being?</s>YOUNG: Iran. And that the students are cheering the United States now for the boldness it took starting in October and because the mullahs hate the</s>U.S. DOBBS: OK. Steve Young, thank you very much. Well, still ahead here, progress has been made on an economic stimulus package. We'll tell you who's given ground and what it could be mean for you. We'll also hear from the national commander of the Salvation Army on charitable giving in the wake of September 11, and now the holiday season. Then what might be the biggest corporate collapse in history. We'll report on the rise and the very sudden, dramatic fall of Enron, next.</s>DOBBS: Enron, the once mighty energy company is on the verge of bankruptcy tonight. Dynegy pulled out of a deal, a proposed deal, to buy the company. Enron's stock today plummeted, dropping 85 percent after its last hope, its credit rating, was cut -- cut in fact to junk status. More than 180 million shares today were trading -- traded making it the most actively traded stock ever on the New York Stock Exchange. The dramatic decline, the speed of Enron's decline simply stunning. Shares traded at more than $80 a year ago, tonight it's only 61 cents a share. $62 billion of shareholder value wiped out. Enron's spectacular flame out is unprecedented in business. Casey Wian has more on the story now from Enron's hometown Houston, Texas.</s>CASEY WIAN, CNN CORRESPONDENT (voice-over): The fatal blow to Enron's efforts to salvage its merger with Dynegy came early Wednesday, when Standard and Poors downgraded Enron's debt to junk status. That triggered a clause in the original $9 billion deal that allowed Dynegy to walk away, a move the company says it made to protect the interest of shareholders. The downgrade and subsequent collapse of Enron stock likely makes bankruptcy the company's best option.</s>TED HARPER, FROST NATIONAL BANK: I think it pretty much seals the fate of Enron in the sense that a bankruptcy filing will be short coming -- very quickly in the offing here.</s>WIAN: Why is that?</s>HARPER: Basically because it's going to hamper Enron's trading ability to such an extent that they're not going to be able to enter into even the shortest term type of trades and agreements with counter-parties.</s>WIAN: Enron employees say they expect a bankruptcy filing soon, though the company would not comment. This woman photographed Enron's headquarters, saying she wanted to preserve her memories. Layoffs are expected, especially in the company's trading operations. Some were suspended Wednesday, because market participants wanted to avoid dealing with Enron because of its deteriorating financial condition.</s>WIAN: As for Dynegy, Chairman Chuck Watson says the company tried hard to salvage the deal. But in his words, sometimes the company's best deals are the ones it does not do. Watson also says you just have to know when to say no, and Lou, today, Dynegy said no.</s>DOBBS: Was it in point of fact the -- the downgrade and the rating of Enron's bonds that led to the decision? Was it that simple?</s>WIAN: Absolutely. That's what -- that's what got the ball rolling, it wasn't as direct as that, but when the downgrade happened it triggered several other clauses within the original $9 billion buyout deal that allowed Dynegy to back out. Now, of course, Enron says it's still studying Dynegy's decision to pull out of that deal, so this could be one for the lawyers and in fact Enron does end up in bankruptcy court it's definitely going to be one for the lawyers, Lou.</s>DOBBS: Yes. It seems like this is going to be a halcyon period for lawyers, irrespective of the course this -- this takes. Dynegy has some exposure as well to Enron, how significant?</s>WIAN: Not very much according to the company on its conference call with analysts and reporters today. They said that their exposure is limited to about 75 million dollars, and they've taken steps over the past several weeks to limit that exposure. They took further steps today, suspending their dealings with Enron's trading operations.</s>DOBBS: Turning to the anticipatory, I hope it's anticipatory rather than simply speculative, but the likely fate of the employees of Enron in this situation?</s>WIAN: Hard to tell. And employees within the company that we spoke with said that there are a lot of rumors swirling around, of course there's the expectations that there are going to be layoffs. There have been layoffs over the past several days. And some employees said that those were continuing today. Others said, though, that they heard that layoffs have been halted in anticipation of a likely bankruptcy filing -- Lou.</s>DOBBS: OK. Casey thank you very much. Casey Wian reporting live from Houston, Texas. Coming up next here, the United States sends more troops into Afghanistan. We'll have the latest developments on the war for you. Then, the incredible story of a family who tried to cash in on a national tragedy, claiming that the wife died in the collapse of the World Trade Center. Also tonight, we'll be joined by the national commander of the Salvation Army on the impact September 11 has had on charitable donations in this holiday season. All of that, a lot more ahead, stay with us. Now the latest developments in the war against terrorism in Afghanistan. The Pentagon saying the leadership of the Taliban and al Qaeda -- that leadership has been isolated according to the Pentagon. Yesterday U.S. warplanes dropped about 10 bombs on a Taliban complex near Kandahar that was believed to be housing Taliban leaders. The father of a CIA officer killed in Afghanistan says his joined the CIA, because he thought it could make the world a better place. 32-year-old Johnny Michael Spann was killed during a Taliban prisoner uprising near Mazar-e Sharif earlier this week. Spain's Prime Minister is downplaying suggestions of a rift between the United States and Spain over the extradition of suspected terrorists. Prime Minister Jose Maria Aznar says his country would consider any such extradition request. Aznar expressed full cooperation with the United States in the war against terrorism during a meeting with President Bush today. Talks on Afghanistan's political future making some progress during a meeting near Bonn today. Two large Afghan coalition members agreed to a transitional council, which would oversee setting up an interim government. Differences remain about the make up of the security force in Kabul. The Bush administration has reached a deal to expand its stockpile of Smallpox vaccine. For the government, the deal with Acambus and Baxter International valued at $428 million. They will provide an additional 150 million doses of smallpox vaccine by the end of next year. That would give the government an expected 286 million doses of the vaccine. That enough to cover the entire population of the United States. In after-hours trading, Acambus rising almost $4.00 a share on top of the more than $4.00 gain in regular trading on Wall Street. Baxter up almost up $1.00. That after the bell, building on a fractional gain during the regular session. There has been a breakthrough on the economic stimulus plan. As we speak, Senate Democrats and Republicans, along with a representative from the administration, that's all three parties, about to sit down and try to work out a deal. The face-to-face talks follow compromises from both sides, as compromises are want to do. Tim O'Brien joins us from Capitol Hill and has the story for us. Tim?</s>TIM O'BRIEN, CNN CORRESPONDENT: Lou, you'll recall just 24 hours ago, Senate Democrats were insisting that any stimulus package include $15 billion for homeland security. Senate Republicans balked, so did the White House. Well, this morning after a breakfast meeting at the White House, Senate Democratic leader Tom Daschle relented. The Democrats are willing to cut the amount of money in half from $15 billion to $7.5 billion. But more important, they're taking it off the table for now, out of the stimulus package debate.</s>SEN TOM DASCHLE (D), MAJORITY LEADER: We have decided to offer the homeland security package, in part, as an amendment to the defense appropriations bill next week when the bill comes to the Senate. We're also going to do something else to make it even more acceptable to our Republican colleagues. We're going to cut the $15 billion in half.</s>O'BRIEN: Yesterday, it was the Republicans making concessions. They still want to repeal the Alternative Minimum Tax, but they've agreed not to make that repeal retroactive, an idea many Democrats just hated. They're also suggesting a payroll tax holiday. No Social Security taxes for businesses or individuals for the month of December. It could also, or either or, December or January. And that could help low and middle income taxpayers, upper income taxpayers in January. It appeals to Democrats and President Bush. Well, he sidestepped questions this morning about the payroll tax holiday, but he did say this.</s>GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Here's what I support. I support the Senate coming together and getting a bill moving as quickly as possible, so that we could get it to conference and get the differences resolved. The Senate must pass a stimulus package.</s>O'BRIEN: Lou, there's still a great deal of work that needs to be done. Whatever the Senate comes up with must be reconciled with a very partisan House bill. But tonight's meetings are progress. And they greatly enhance the probability that President Bush will get what he wants, a stimulus package for Christmas.</s>DOBBS: What he wants, Tim, and what the country needs. This a major breakthrough, the Republicans willing to relent on that retroactive corporate AMT. That was an idea that just -- whose time simply had not come?</s>O'BRIEN: No, and you know, there's a great deal of support for it, but not at this time. There's a lot of question as to whether it was really a stimulative. The fact is both the House measure and the Senate measure, the original Senate bill, were very partisan. Senate -- the Democrats, they control the Senate. They were not listening to Republicans. And you had the same situation in the House where the Republicans are in control. Now they are coming together. And there's a real chance that they can work this out.</s>DOBBS: That is terrific news. Tim, thanks very much for bringing it to us. Tim O'Brien from Washington. Millions of dollars of U.S. grain and food are on their way to Cuba over the next few weeks. Despite the economic embargo, companies are selling food to Cuba to help it recover from Hurricane Michelle. These sales are the first of their kind in four decades. Kitty Pilgrim has the story.</s>KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Havana, Cuba, the hard-line government doesn't change its mind quickly, but it has just made an exception to its vehement statement that it will never buy U.S. food or agriculture under current U.S. restrictions. In recent weeks, Hurricane Michelle devastated the island, flattening houses, ruining crops, and killing five people. Cuba decided to cave.</s>JOHN KAVULICH, US-CUBA TRADE & ECONOMIC COUNCIL: The fact that it's taken place is significant due to the fact that the Cuban government has said since October of last year that they were not going to buy anything under the provisions of the current law.</s>PILGRIM: Archer Daniels Midland is the first U.S. company since 1962 to have a contract for food exports to Cuba. They are scheduled to ship 20,000 tons of wheat this month. Arkansas-based Riceland Foods will ship 15,000 tons of rice over the next two months. Other companies involved, Minneapolis-based Cargill will ship corn and vegetable oil. In the last year, U.S. agriculture companies lobbied and won legislative changes for U.S. companies to be able to access Cuba's $700 million import market. They can now legally sell crops for cash to Cuba. But Cuba has stubbornly objected to the all cash terms, demanding credit. So up until now, no deals have been made. Some see this sale, made under humanitarian auspices, to be a significant exception.</s>SUSAN KAUFMAN PURCELL, COUNCIL OF THE AMERICAS: So in a sense everybody is sort of happy. The U.S. companies are happy because now they have access to that market. The pro-embargo people are a little unhappy that the embargo, you know, has a hole in it, but on the other hand, it's not a big hole, as long as it requires cash for the sales.</s>PILGRIM: Now the ultimate question is where does this leave the embargo? And that appears to be still firmly in place, supported by many, including President Bush. Not likely to be changed unless Cuba changes a little bit more than its mind -- Lou.</s>DOBBS: Kitty, thank you very much. Kitty Pilgrim. Coming up next here, a sell-off on Wall Street for the second session in a row, pressured by a collapsing energy deal and a somber Federal Reserve report on the economy. We'll have that for you. Also, the latest on a couple accused of trying to cash in on the September 11 tragedy. Also, the holiday season is a crucial time for charities. We'll take a look at how those not raising money just for September 11 victims are faring in these extraordinarily difficult times. That and a lot more coming right up on</s>MONEYLINE. ANNOUNCER: Next Lou speaks with John Busby, commissioner and national commander of the Salvation Army.</s>DOBBS: And incredible story about a couple who attempted to cash in on a national disaster. Charles and Cynthia Gavett, held on insurance fraud charges, were denied bond today. The couple allegedly filed fraudulent insurance claims and ordered to collect on a $200,000 mortgage insurance policy. Charles Gavett allegedly reported his wife was missing shortly after the terrorist attacks on September 11, claiming she had a 9:00 a.m. appointment at the World Trade Center that morning. The Gavetts face felony charges that carry up 10 years in prison and a maximum $10,000 fine. Well, last year, the Salvation Army raised more than $1.7 billion for the nation's poor and needy, but the organization faces obstacles this year. It's dealing with both a faltering economy and in fact competition with charities raising money for September 11 victims. Joining me now, the head of the Salvation Army, John Busby. Good to have with us, commander.</s>JOHN BUSBY, COMMANDER, SALVATION ARMY: Thank you. Nice to be with you.</s>DOBBS: Let's start first, how much money have you been able to raise since September 11 for the victims, the families of those victims in the September 11 tragedy?</s>BUSBY: The last figure that I've had is that we've taken in some $62 million to assist us in our disaster work.</s>DOBBS: And what types of things are you doing in terms of the September 11 of tragedy?</s>BUSBY: Oh, within an hour of the planes striking both in New York and Washington, our mobile canteens were on the scene serving and helping those who were assisting in recovery. And of course, we are at the present time working with many of the victims. I was talking with both our New York office today and our Boston office. Interestingly in Boston, the divisional commander there was telling me that they are visiting in the homes of all those who had relatives on the planes that took off from Logan and are having a time of prayer with them and also giving a check to them, to assist them during this time. And the same is true in New York, where we have our disaster set up on Pier 94. And individuals are coming to us there.</s>DOBBS: And in the wake of September 11, is it making your fundraising easier or more difficult?</s>BUSBY: Well, you know, I have the theory that the more people give, the more people give. That was proved to me 10 years ago, when I was divisional commander in Florida and Hurricane Andrew hit. And we were very worried about our Christmas program that year. You may recall the hurricane came in late summer.</s>DOBBS: Right.</s>BUSBY: And that year, our Christmas program was up. I've made some spot checks around the country today. And in 10 locations, 5 were up and 5 were down. So I guess we're running about even with what we've done in the past. Last year, we had some $85 million that were given in the red kettles. And we have 20,000 of those spread across the country now. And we hope people will be very generous in helping individuals in their own community, who are suffering at this time.</s>DOBBS: Well, one of the things that we've learned with all the concern and criticism of, for example, the American Red Cross, other charities who are raising money in particular for the families of the victims have September 11, was that there's a great focus now on how much money is actually going to victims and to the charities, to those who really need the money. What is the administrative cost for the Salvation Army?</s>BUSBY: Well, as far as our disaster is concerned, 100 percent of funds that are given to us for disaster go into disaster. And if a check is given to a local Salvation Army Corp anywhere in this country, and we have over 9200 locations around the country, that money comes through the system to the point of need, where the service is being rendered. That's been our policy as far as disaster funds is concerned before September 11 and is certainly continuing on.</s>DOBBS: I actually, I have to be honest, I knew the answer to the question before I asked it, but I thought we ought to get it out on the record. And your administrative costs run about what percent of the money that you do raise each year?</s>BUSBY: Well, it's hard to indicate a total amount, but normally we say around 85 percent of the funding that comes to us goes for our programs. So it runs around 15 percent.</s>DOBBS: Well, as everyone knows, you and all the volunteers do a wonderful job. Much continued success in raising money and the good work that you're doing. And I'll make sure my check's in the mail.</s>BUSBY: Thank you very much. We greatly appreciate that.</s>DOBBS: Commander, thanks for being with us. Well, let's turn to Wall Street, going from charity to good old business. Today it was bad business, a losing session on Wall Street. Blue chips suffered back-to-back triple digit losses. Prompting the selling today, news that Dynegy had ended that proposed merger with Enron. The Fed's Beige Book Report, showing more signs of a sluggish economy. The Dow, as a result, falling 160 points. The Nasdaq dropping 48. And the S&P; 500 losing 20 points on the day. For more on the selling, Jan Hopkins at the New York Exchange, Greg Clarkin at the Nasdaq You get to begin the festivities, Jan.</s>JAN HOPKINS, CNN CORRESPONDENT: Thanks, Lou. The story of the day was definitely the Enron-Dynegy merger falling apart. Both of those stocks trade here at the New York Stock Exchange. And as you mentioned earlier, Enron stock broke a record. 183 million shares traded. If you add all exchanges, 343 millions shares traded. That's half of all the shares outstanding. At the end of the day, you can see the damage. Enron down to 61 cents, an 85 percent decline today. Dynegy down about $5.00. And then the lenders to Enron, J.P. Morgan and Citigroup also down sharply. Now if you look at the day in the market, you'll see that the market declined early on and tried to recover, but it lost ground throughout the session as this deal fell apart at noon. And then in the afternoon when the Fed told us that the economy was slipping further, then the market continued to fall and was not able to recover. Now Lou, maybe this news of a stimulus package progress will help things tomorrow, because the market was also concerned that the stimulus package was falling apart.</s>DOBBS: I think you're exactly right, Jan. Thank you, Jan Hopkins from the New York Exchange. And turning to the Nasdaq, the Nasdaq fell 2.5 percent on the day. Greg Clarkin to bring us up to date. Greg?</s>GREG CLARKIN, CNN CORRESPONDENT: And Lou, this was one of those days where there really just wasn't any good news out there for investors to focus on. Jan mentioned the Beige Book. That affected stocks in the afternoon. In the morning, we saw a number of news reports weighing on stocks, especially on Intel. A Taiwanese newspaper saying that Intel may have trouble meeting demand for its Pentium 4 chip. The Nasdaq all totaled, closing at the session lows, down about 2.5 percent. Networking stocks very weak as well. Shares of Ciena dropped significantly. That fell on fears that telecom companies may cut their spending more in the first quarter. That dragged JDS Uniphase and Sycamore Networks down with it. Intel, as I mentioned, was off on that newspaper report. And Applied Microcircuits, a communications chip operation, they say visibility is limited for the first quarter. Now what we didn't see today is something that we have seen in many instances over the last couple weeks, in this latest Nasdaq run. That is investors coming into the market during the session points, the low points in the session, basically. We didn't see that today. We didn't see any investors coming back in, as the Nasdaq was falling. And subsequently, we did get the Composite closing at session lows -- Lou.</s>DOBBS: OK, Greg. Thank you, Greg Clarkin from the Nasdaq marketsite. Just ahead, Enron reshaped the way energy is bought and sold in this country. Tonight, it's facing bankruptcy. The rise and fall of an energy titan. And "Fortune" magazine's Rik Kirkland will join us in just one second. Stay with us.</s>ANNOUNCER: After the break, Lou is joined by Rik Kirkland, managing editor of "Fortune" magazine.</s>DOBBS: Here we again. Of the 15 analysts covering Enron stock, 7 have a buy or strong buy recommendation on the stock tonight. Just one has a sell rating. Allan Chernoff takes a look at Wall Street, pardon, what is turning out to be one of the biggest meltdowns in corporate history.</s>ALLAN CHERNOFF, CNN CORRESPONDENT (voice-over): Enron's crown jewels, its trading operations, had accounted for 90 percent of the company's profit at their peak, a dominant force in financial products tied to oil, natural gas, and electricity. But the value of those jewels eroded rapidly in recent days, as few companies wanted to trade with Enron, fearing the company's creditworthiness was at risk.</s>JIM NORMAN, PLATTS OILGRAM: The way Enron Online was set up, there is no clearinghouse to absorb the credit risk. Enron itself stood behind every deal. In fact, they were either a buyer or a seller on every deal. So Enron was the credit risk.</s>CHERNOFF: Standard and Poors was watching volume on Enron Online carefully. As volume sank, the firm decided Dynegy was going to pull out of its deal to buy Enron. So S&P; downgraded Enron to junk status.</s>TODD SHIPMAN, STANDARD & POORS: We had always connected Enron's investment grade rating to Dynegy's interest in Enron trading operation. And to the extent that the trading operation was going downhill, we thought Dynegy's interest in the deal was following that very closely.</s>CHERNOFF: Enron Online went offline, as Standard & Poor's announced its decision. Quotes frozen at 10:54 Central time. A company spokesperson said Enron Online did some afternoon trading in natural gas. Though many traders turned to the natural gas pit at the New York Mercantile Exchange to do their business. Enron's latest troubles leaves its trading partners wondering if the company will be able to pay its debts. The immediate losers are shareholders, who received little help from Wall Street analysts, many of whom had been recommending stock till the bitter end. Last Friday, C.S. First Boston reaffirmed the strong buy in Enron, saying the company is significantly undervalued. (on camera): Only this morning, UBS Warburg downgraded Enron to a hold from a strong buy. Ironically, one of the firm's unit investment trusts had liquidated its Enron holdings, according to a filing with the SEC last Friday. Allan Chernoff, CNN Financial News, New York.</s>DOBBS: Well, for more now on the stunning rise and stunning fall of Enron, I'm joined by Rik Kirkland. He's managing editor of "Fortune" magazine and MONEYLINE regular. Rik, good to have you here.</s>RIK KIRKLAND, EDITOR, "FORTUNE" MAGAZINE: Good to be here, Lou.</s>DOBBS: This is just an unbelievable story in Enron. It looks like we're headed straight for bankruptcy.</s>KIRKLAND: I was on last week. And said the market predicting this dog wasn't going to hunt given the spread between the price and what the merger deal was. The market saying today this dog is dead.</s>DOBBS: Yes. And we look at Enron for a period of about three year's, a remarkable success story. Just about everybody was saying Ken Lee and Enron were the just premiere example of how to run a modern business in a new millennium.</s>KIRKLAND: Absolutely. It reminds me, you know, of my old Greek mythology, the myth of Icarus. You know, he flew too close to the sun. I mean, this was just an incredible high-flying company. And I don't think any company has fallen this far, this fast in American business history.</s>DOBBS: But you know, Rik, I also know a number of people, and a number of people in the energy business, I would say to them, "Exactly describe for me Enron's business," in talking obviously with some people at Enron. And by the time you get through with it, I have to tell you, a very difficult business to understand, at least for a television journalist. Perhaps not for a magazine.</s>KIRKLAND: It's hard for us. You know, back in February, we did a piece in "Fortune," asking is Enron was overpriced? And part of our -- we said yes. And part of our confusion was the accounting was so opaque, we couldn't figure out what was going on.</s>DOBBS: In the trading side of it, the broadband side of it, they positioned perfectly to trade everything as Ken Lee once said in the company.</s>KIRKLAND: I think one of the real casualties of this thing is this whole notion that Enron was the avatar -- trading business was going to be the salvation of the energy business. You can make more money trading than you could actually moving gas and oil around. This is a 20 percent a year growth business with better margins. I think that's going to -- I think there's some funky accounting that Enron was the most guilty of, but I think it's probably going to have to be rethought across the industry. It's a slower growth business.</s>DOBBS: And in terms of Enron, Ken Lee, a terrific guy. What do you make of it?</s>KIRKLAND: I don't know. It's a tragedy. I mean, Ken, as you say is a good guy. He's a smart guy. He's a real industry statesman, but right now, his reputation is completely tarnished.</s>DOBBS: And those analysts who still tonight have a buy rating or a strong buy rating?</s>KIRKLAND: Just say no. Don't listen to them. I mean, these guys are bozos.</s>DOBBS: There you got it. There are certainly out of 15 that are. Rik, as always, good to have you with us.</s>KIRKLAND: Thanks.</s>DOBBS: Rik Kirkland. Well "WOLF BLITZER REPORTS" begins in just a few minutes. Let's go to Wolf now to find out what it is store. Wolf?</s>DOBBS: Coming up next here, we'll take a look at some of your thoughts and tell you a bit about what to expect tomorrow. Stay with us.</s>DOBBS: Tomorrow will be a very exciting day on economic reports. Those reports include durable goods, new home sales, weekly jobless claims. And corporate America's chief executives are convening in New York City for a CEO "bootcamp," a crash course in running public companies. And there seems to be a real demand for those skills today. One other programming note, earlier we had promised you a look at the advertising slump, its effect on Madison Avenue. Because of news developments, we'll be bringing that story later this week. Taking a look now at some of your thoughts. A question on the markets. Bonds in particular. Ann writing, "What do make of the return of the yield curve to normal over the last two weeks versus the inverted curve of the last six plus months?" The inverted yield curve, when short term interest rates rise above long term rates, inverted mainly because investors drive down long bond yields in anticipation of Fed rate short cuts. And now, the opposite is happening. The Fed has cut short-term rates and the long end of the curve is rising again. Investors obviously feel the rate cuts are working and that the economy is headed to recovery. So the shape of the economy very often depends on the shape of the yield curve. And a big beneficiary, banks that can borrow cheaper and lend at higher rates. Well our story last Friday about the surge in patriotic country music, prompted Brett McCormick of Austin, Texas to write us on the subject of entertainment during wartime. McCormick and his rock band "Octane" are performing for U.S. troops in Diego Garcia. That's the military base in the Indian Ocean and in four countries, he's not at liberty to name. Brett writes us to say, "The response we have had from the soldiers is phenomenal because they say it is so refreshing to hear some American rock and roll. We play for the airmen who fly the bombers. We play for the people who load the bombs on the bombers. And it was such an honor to do it." Brett, thanks for the note. Keep up the good work. And you'll never have a better audience. Send us your thoughts at moneyline@cnn.com. Include your name and address. That's MONEYLINE for this Wednesday evening. Thanks for being with us. I'm Lou Dobbs. Good night from New York City. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com