Via Floyd Norris comes news from Credit Suisse that FSAB changes to fair market value accounting -- specifically mark to market requirements -- have boosted the value of bank assets and hence profitability. Who would have thought?
To risk over-statiing the obvious, if banks are given trillions of dollars, either directly or through the purchase of sketchy assets and then allowed to value their remaining sketchy assets at inflated values, it is scarcely surprising that they turn a profit.
Nor should we take comfort in the fact that this is an American issue. We have directed $200 billion toward the purchase of 'troubled assets' of our banks and have made similar changes to accounting rules. And unlike the U.S., we have done this with no public debate.
What was that about lipstick and pigs?
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment