Maybe we should have seen this coming-after all, no company is that good. And nothing goes up forever. Nothing. Since the shocking, disappointing and infuriating collapse of Enron Corp., you can throw much of what you know out the window. Deregulation of the power market is in question. High-flying business models have crashed to earth. Conglomerates such as El Paso, Dynegy and Calpine are scaling back ambitions, feverishly reducing debt and correcting their maladies before someone else makes them do it. Since investors have been quick to paint everyone with the same brush, the suddenly popular (and all too necessary) IR strategy at year-end was to issue a press release saying in essence, "We are not Enron. And even if we are, we promise to change as soon as possible, certainly well before you figure it out." El Paso summed it up well by saying, "It has become clear that the market now expects energy companies to maintain lower leverage and more simplified balance sheets." I loved its euphemism for its new plan though: balance sheet enhancement. One might rather call it scrambling to get to church on time after a blowout that lasted into the wee hours. I would advise you to go long paper if you were trading on EnronOnline, because the mountains of paper generated by lawyers, congressmen, analysts and journalists while trying to explain and resolve this fiasco will be high enough to cover the dugouts at Enron Field. An uncomfortable parallel with Penn Square Bank, which failed in July 1982, comes to mind. That notorious oil and gas disaster set off a ripple effect throughout the banking industry that I only hope is not repeated this time-after all, it is 20 years later and we are all smarter this time around. But the effects on some companies from the Enron fall will be hard felt. Those numbers will show up in this season's earnings results. Independents who sold gas to Enron in November, but have not been paid yet, will suffer, especially the smaller-cap ones who are already hit hard by lower commodity prices. Ditto for those owed money from hedging positions with Enron. Cabot Oil & Gas Corp. said its pretax exposure to Enron is about $2.4 million-but much smaller Panaco Inc. said its exposure is $2.8 million. Which company can more easily absorb the hit? Ohio State University and the city of Colorado Springs, among other consumers, had to scramble to get energy supply elsewhere right after Enron began to crumble. Two European forest companies nearly failed as they ended up on the wrong side of pulp and paper trading with Enron. Even companies that have nothing to do with this may have been touched. In December Standard & Poor's affirmed GulfMark Offshore's double B- rating, but maintained its negative outlook for lack of visible earnings growth in 2003. "We believe this is simply a reaction and an effort to limit risk on the part of S&P due to recent criticism about its actions regarding ratings for Enron debt," said Stifel, Nicolaus & Co., Denver, which has a Buy on GulfMark. Some of the ripple effects from Enron's turbulent wake are more fortuitous for competitors, and thus, the overall market. Asset sales by El Paso and others seeking to improve their balance sheets will no doubt enrich the buyers and competitors. The number of trading parties or first-time users, and gas and power trading volumes, on DynegyDirect, the Intercontinental Exchange (ICE) and the New York Mercantile Exchange have jumped significantly. Nymex said it will offer clearing services for over-the-counter products traded outside of regulated exchanges or on Internet sites, and may, through alliances with money-center banks, provide counter-party credit back-up. Ratings agencies, accountants and the SEC may reform their practices now that pro forma data, off-balance-sheet debt and EBITDA numbers seem suspect. Financial engineering may not be the panacea it was cracked up to be. S&P, Moody's Investors Service and Fitch have sharpened their swords. Ratings triggers have "unintended consequences and can be highly disruptive," said Moody's when announcing a revised, stricter scrutiny of such deals. Triggers have become more prevalent globally, and are especially common in debt issues rated low investment grade or teetering on that level, "where they are most lethal," said Moody's. Enron had cornered the market on cleverness. To our regret, it also cornered arrogance and delicate deception. Enron's demise seems a fitting, but tragic, punctuation mark to end the greedy 1990s stock boom-it just came a year late. And so, here is our new list of New Year's resolutions for 2002: Reduce debt. Don't get ahead of your ability to manage and explain it all. Review your position frequently. Keep your nose clean. Cash is king. Keep it simple, stupid. Don't grow for growth's sake. For once, make a decision based on business; not to feed that insatiable quarterly hunger on Wall Street.