Chairman Barney Frank comments on MTM!
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Bernanke Against MTM Suspension
In Bernanke Urges Rules Overhaul to Stem Risk Build-Ups, it is clear Bernanke does not support suspension of mark to market.
Neither do I. He does point out the pro-cyclical nature of MTM, and the need too counter this feature. He also very pointedly commented that fair value might obscure transparency.
Still, in periods of financial stress, when some markets don’t exist or are highly illiquid, “the numbers that come out can be misleading or not very informative,” Bernanke said.
We will try and get more comments from the full text of the Q&A.
-BB
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Continuing Destructive Policies
Steve Forbes is at it again – He makes a simple and rational case in his article, Obama Repeats Bush’s Worst Market Mistakes. He says,
The most disastrous Bush policy that Mr. Obama is perpetuating is mark-to-market or “fair value” accounting for banks, insurance companies and other financial institutions. The idea seems harmless: Financial institutions should adjust their balance sheets and their capital accounts when the market value of the financial assets they hold goes up or down.
This has some politcal point scoring in it, but is good on the basics.
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Bank Write-Down
Chief Executive Officer Richard S. Berg talks about why bank write-downs are important to consumers, banks and investors.
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