Fair Value AccountingAnother ongoing regulatory process is FASB's proposal to substantially revise the accounting standards for financial instruments. Under the proposed rule, banks would be required to measure substantially all of their financial instruments at fair value on the balance sheet.
While we understand that the objective of the rule is to make financial statements more transparent, we believe that its effect could be to undermine financial stability by making bank performance more procyclical. In short, we do not believe that a bank – whose business strategy is to hold loans and deposit liabilities for the long term – should be required to measure them at fair value on the balance sheet.
70% of all Americans own some stocks. It is hard to avoid the financials if you’re in a fund, so the consumer’s new champion, Elizabeth Warren, should take up the issue of clarity on bank financial statements. That would be a cat-fight I would like to see.
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It's ironic that 10 years ago all of these people criticized the Japanese for doing exactly this sort of banking extend-and-pretend.
ReplyDeleteDoes this bozo actually believe banks never will sell.
ReplyDeleteBruce Krasting = Bankster Charlatan
ReplyDeleteThe whole point of a balance sheet is to reveal the financial condition of an entity on a given date. If the greedy banksters took too much risk and now the assets are worth nothing, that should be reflected accurately. Who's bankster pocket are you in, JP Morgan, B of A?
I am retracting my earlier statement immediately above. I misread it. I apologize.
ReplyDeleteBlair is incompetent like the guy who appointed her...Blair's financial background is limited to being a Bank Teller and that is it...Blair's claim to fame is being the author of a couple children's books...Something GW was fixated on when the nation was under attack on 911.
ReplyDeleteGee. It'd sure be nice if we didn't have to use "fair value" in calculating estate taxes (next year, anyway). Cost basis would be so much nicer.
ReplyDeleteAnon at 12:11 Thanks for the clarification. Actually I am an ex bankster. After 15 years of penance I am now reformed.
ReplyDeleteYou can't be a bankster without also being a charlatan. I'm still good at that.