Maru: Toxic Assets at Banks Avoid GAAP and Mark-to-Market

March 7, 2012 by · Leave a Comment
Filed under: Market News, Toxic Assets 

In a contribution to Resource Investor, Vin Maru writes that the western financial system’s reliance on pure fiat currency “is the virus that will be the death of the financial world as we know it.” Regarding the economic downturn of 2008 and subsequent Troubled Asset Relief Program (TARP), Maru criticizes the actions of the government, saying that the financial system “will not be allowed to naturally correct and adjust” because of the TARP bailout.

“Banks which own toxic assets are no longer keeping financial records under generally accepted accounting principles (GAAP) or applying mark to market valuation for the assets they hold on their books,” says Maru.

The banks are not to blame, though, he says. The bailout and lack of GAAP and mark-to-market regulation, says Maru, simply act as “bandages to conceal the wounds from the public’s eye.” Capital injections and “printing money,” says Maru, “seems to be the cure to all sovereign debt problems” both domestically and globally.