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FASB to Fold on Mark to Market
A board member at the FASB, Lawrence Smith, gave an interview with Reuters on
the status of US accounting standards moving toward greater
transparency. According to Smith this important change is not going to
happen.
Why? Because the folks who have the most to lose by forced transparency
have complained! What a stupid reason to fold by the FASB.
"Thus
far, I think the count is up to about 1,500 or so comment letters," said
Lawrence Smith, a board member of FASB, which sets U.S. accounting
rules. "I think I've read one that supports what we propose."
So what if the letters are 1,500 to 1? That the banks and finance
companies are writing all these letters is probably the best evidence
that MTM is desperately needed.
Smith added that board members will probably be influenced by the opposition.
"If I were a betting person, I would bet on some type of hybrid model being adopted".
Well I am a betting person and I will bet that there will be no MTM from
FASB. They will crater to their own constituency and do the wrong thing
for the investing public, again.
This makes a joke of:
-The FASB
-The companies who wrote the letters
-The SEC
-The accounting profession
-FinReg, as it is proving to be a toothless set of regulations
-The US Treasury. (they did not write a letter)
-The Federal Reserve (who also did not write a letter) the Fed has been
pushing on this issue and will not step up to the plate when necessary.
The banks are all afraid of MTM. They want to be able to hide an asset
on their books that is worth 50 cents on the dollar and maintain it at
100 cents. When FASB blesses this insanity the banks will just abuse the
rule to hide more junk.
So when you are out there buying bank stocks know that the assets you
think are there have nothing to do with the fair value of those assets.
That the financial statements you read are just a charade. You can draw
no conclusions on the health of the company you are investing in. And
that the FASB has blessed it and wants it that way. Caveat Emptor.
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Some would call this another failure of regulation. I would call it another case of regulation working exactly as designed. Regulation is governments and incumbent businesses working together (against potential competition and the general citizenry).
Laws/regulations and their selective enforcement are the playground of the elites.
It is written in the Constitution, or rather codified as such, by the use of upper and lower houses of Congress.
Consider: the insidious rules to elect Senators and the Senate's power to trump the lower classes, umm...House.
This isn't that shocking. Anyone who thought that mark to market would be overturned must have forgotten that the people who write the rules are the public half of the central banking cartel trying to tell the private half what to do. It just doesn't work that way. The point of a central bank is always the direct and conspiratorial control of the market by all means necessary, particularly by engaging the help of your local friendly greased-palm pol. You just can't expect the foxes to do anything but build easily-defeatable fences around the chicken coop. Sure, they will build them, but like the border fence, they will innocently build them on mexico's side, and then have to tear them down, or they will put a door in the fence every few hundred feet, or stairs to climb up and over, or leave a chopper and a loaf of fresh baked bread waiting there to take people across for a lunchtime ride.
Every legislative or regulatory action is the essence of trickery. It's pretty simple to figure out - just read the legislation title, and then invert it's meaning, and you've pretty much got the picture. Anytime they say the blah blah accountability act of blah, the text of the legislation will be the exact opposite of it, guaranteed. That's one of many tricks they use.
Sorry to be so cynical, but that's been my experience.
Or when it comes to shorting any of the market indices or high flyers in this every other day POMO schedule....Caveat Venditor!
Disgusting, this sorta proves how bad things are. Gold/silver, guns and semi precious stone time. What they are trying to do has NEVER worked in history. They are going to make it worse then it ever had to be.
Food?
Didn't you know? You can eat emeralds. They ARE green.
MTM 2010
http://williambanzai7.blogspot.com/2010/09/new-from-stuxnet.html
Banzai,
MTM needs this "green" sticker ...
http://www.cafepress.com/+low_efficiency_vehicle_bumper_sticker,35891479
Goldman Sachs marks everything to market, every day. They are the only bank that does.
Chemba, we know you are in bed with Goldman-Gonorrhea, but the hole in your religion is that they "are" the government chosen racket-makers. Mark to fantasy/market in your own imagination means nothing when it is [purposfully] unverifiable. Just like FASB accounting on the entire Fraud-500.
All the bailouts the "best and brightest" continue to receive at the clinic for failure don't affirm your premise (somehow Goldman's risk goes away when only THEY turn off the lights) either, but then again often the first symptom of Gonorrhea is loss of clarity in vision.
Yeah, but for them it is different. If they notice in the morning that one of their piles of shit has started to smell, they call Timmy and Benny, and by the time it is "mark to market" time in the afternoon, it is sold. For par.
Too much government. Revolutions end badly. Lots of parasites (bankers, bureaucrats, dictators, "policemen") lined up against a wall with lots of pock-marks in it.
Sooner is better than later.
Not if GS is buying assets that are flawed in their valuations due to lack of MTM. I dont get your comment.
Bruce,
One of the last steps taken by a corrupt regime/system is to outlaw exposing the corruption under the guise of National Security. Thus the argument goes that allowing the extent of the corruption to become widely known is more harmful to the integrity of the nation than the actual corruption .
Of course, that's the ultimate in self serving conclusions. But those who have the golden power make the rules. Thus those who have profited, or will profit, from the corruption will do everything and anything to ensure the perpetuation of the corruption.
Think back to May of 2006 when this little gem was published, well before the 2008 market crash. I guess they knew something was coming, wouldn't you say? And think about what has transpired since then. Does anyone other than the hopelessly naive or in denial think there haven't been other Presidential orders along these lines? The entire Ponzi has been declared a National Security priority and nothing short of revolution will bring it out. Nothing.
Intelligence Czar Can Waive SEC Rules
http://www.businessweek.com/bwdaily/dnflash/may2006/nf20060523_2210.htm?campaign_id=rss_daily
Now, the White House's top spymaster can cite national security to exempt businesses from reporting requirementsPresident George W. Bush has bestowed on his intelligence czar, John Negroponte, broad authority, in the name of national security, to excuse publicly traded companies from their usual accounting and securities-disclosure obligations. Notice of the development came in a brief entry in the Federal Register, dated May 5, 2006, that was opaque to the untrained eye.
"The entire Ponzi has been declared a National Security priority and nothing short of revolution will bring it out."
Damn straight!
The Final Act of any Government is to loot the Nation.
The Final Act of any CORRUPT Government is to loot the nation! Eh!
Unless you are referring to self-government, you're being redundant.
+1
We merely need more help hiding the dead bodies. We don't have enough guys with shovels, so the Mayor just re-assigns all the cops to buy lye from the hardware store, and re-purpose squad cars to haul bodies to mass graves.
Literally, that's all we are doing: Everybody is trying to hide bodies as best they can, without thinking about the fact that a "missing person's" report will come in next week, which these same cops will be tasked to investigate.
All individuals working on wall street are now tainted with the reputation earned by their industry. All bankers are in the process of being tainted with the reputation earned by their industry, and their regulatory structure. Ditto with government regulators. Now (not new), but ditto for the accountants.
What a shame: The accountants could have called "Bullsh*t", and saved themselves from the hangman's noose. Not anymore.
One must adapt to the system if one is to survive within the system. Once the system has gone full frontal corrupt, the accountants must do the same or be expelled and replaced. One must respect the need to earn that paycheck when one is tied to the system that requires a paycheck. Ya gotta do what ya gotta do.
While reading a few weeks back about "sports psychology" I couldn't help but see the parallels between it and the sociopaths mind. In a terribly gross and unwarranted oversimplification of both sports psychology and sociopathy, many athletes are trained to become extremely narrow minded while pursuing a single purpose in order to deal with or push aside self doubt that might be caused by injury, a recent under performance, the desire to stray from a brutal regime, competition etc.
Essentially, and again an oversimplification, they must exercise selective memory and indifference to others, including themselves, in their single minded pursuit for the ultimate performance. In some respects, they are practicing willful denial. This is very similar to the sociopath, only for the sociopath, it all comes "naturally". But I was reading that for some of the best "natural" athletes, this mental attitude also comes "naturally".
http://en.wikipedia.org/wiki/Sport_psychology
Wall Street loves nothing more than an Ivy League athlete. The accountants are the equivalent to the medical "profession" under Hitler- happy to join in.
So, sociopathic behavior is reinforced via rituals, like say the one in November.
Remember folks, vote early, and often.
Now we know why Bob Herz resigned.
Chris
funny how they got thousands of letters and crates of evidence at the CTFC about what's happening in the silver market with JPM and HSBC, and somehow....
they managed to ignore that......
it all depends on what the banks what....clearly protecting the peasants and creating honest markets is irrelevant now.
funny how they got thousands of letters and crates of evidence at the CTFC about what's happening in the silver market with JPM and HSBC, and somehow....
they managed to ignore that......
it all depends on what the banks what....clearly protecting the peasants and creating honest markets is irrelevant now.
And I thought he just wanted to play golf......
It's bizaare that you would have thought otherwise. In this day and age, when EVERYTHING is on the line with goverments around the world, you thought that they would let all of their heavy lifting go down the tubes?
Come on. Get with the program. Fantasy. It's over and has been for a while now. Accept it.
So outside of buying gold and silver and canned food, what can we do as individuals? Can we write letter to the FASB? Can we rally the troops here? What if one is angry and upset and feels helpless... who do i write to?
They are giving us lesser and lesser options to protect ourselves and livelihood and property rights.
Soemwhere along the line shooting will start. These idiots want to 'be in charge" but and completely incompetent or have no backbone to "make the tough choices" and to "stand tall" on regulating this mess.
I have to tell you the financial and economic business/industry/sector is the most crroked and spinless group of "professinals" that I have ever seen in my life. This is what aspiring to get "an MBA" lifts one to this level of ethical debasement and integrity deficit? THIS is the "high level" of analytical and committment to to professiol conduct??
These people need to get off the planet.
There is no great "qualification" in turning Oxygen to CO2.
I think if you had a qualified opinion on the subjest and wrote a letter to FASB encouraging THEIR proposal they would read it.
I don't think it would matter at all. This cake is baked
bk
Thank you for your message. Please recognize that the author of the (brief) article was very selective in quoting what I said. While I did make the comment about the 1500 letters, the reporter failed to mention that I also reported to the group that board members have participated in meetings with well over 100 investors who, for the most part, appear to support a mixed attribute system with amortized cost being used for assets that meet certain characteristics and are held for the collection of contractual cash flows. I expect we will be summarizing the results of those meetings and making the summary available fairly soon. My comment about where we might come out was clearly speculation based primarily on the result of the investor feedback we have received. Also, it was clearly speculation, and was introduced as such. The FASB has not held any deliberations on this topic since we issued the exposure draft. Additionally, in terms of your comments about assets held at amortized cost, please recognize that we have proposed a more robust impairment model in the exposure draft, which will also be redeliberated with the IASB later this fall.
Lawrence W. Smith
Member of the Board
Financial Accounting Standards Board
401 Merritt 7
Norwalk, CT 06856
203-956-5349
lwsmith@fasb.org
Nice to hear from one of the bought and paid for. You will cave and you will tell yourself it is for the good of the Country. Make sure you polish up your lapel flag when the crowd comes to drag you to your hanging. I am opposed to violence but fear that your Control Fraud, unpunished, may lead to that.
Your spin might play better with a dumber bunch.
Lawrence Smith of FASB uses the moniker "Let them all fail". LOL!
+.00000000000000000001
I'm flattered by your one in a million talk. So you're telling me there's a chance... YEAH!
Lawrence and his fellow board members will bend like reeds in the wind. It is the nature of hacks to do so. Protect the brotherhood at all costs. Screw the taxpayers that will pay for decades of unnecessary measures for companies that should have been allowed to fail.
So is Arthur Andersen going to make a comeback..?
The side step of basel II over the last few years, mark to market worked fine until it didn't ... The entire game is such a joke.
As joe six pack gets nailed to the cross for the sins of bankers/accounting/rating *Oligarchies*.
Change the rules on the run, I understand. "privatizing profits and socializing losses" , is great for the FASB it keeps the credit/debt machine rolling, job security ...
The "Joe Sixpack" label covers a lot of different situations for the people involved. The economic downturn resulted in lost jobs for a lot of honest people. But there were a lot of people playing games during the Alan Greenspan building boom. If I recall correctly, during the early 2000's there was even a brief TV series, "Flip That House"
Here (North of Detroit), quite a few folks in the building trades suddenly became builders. Borrowing cheap, buying land and building large houses for 50% profits. Toll Brothers even came to town building both condos and large houses.
We really should reel in our expectations as a populace. The pain will persist until we do.
Mr. Smith,
Thank you for contributing to this discussion. Your input is most welcome.
The proof will be in the pudding on this. I think you summed up the outcome already with the"betting man" comment.
What will come will be a half step at best. Lets face it, what you (FASB) have proposed as a set of rules will not be the outcome. Even you can't be happy with that result.
Bruce Krasting
Bruce - For what its worth, that was a reply to an email sent to Mr. Smith referencing the Reuters interview rather than a post by him.
Next time please provide a link so we all know this, thanks.
I thought that pile of crap came to the fight club ..
"let them all fail" as a poster name? come on, man!
It would have certainly been an irony to choose that screen name. I would support it if they just renamed it to something honest, at least.
Mark to unicorns, fantasy, whatever we need to hit our numbers, bernanke's will, or god's work would all be fine by me.
Ah! Fooled me. Thanks for the clarification.
b