Fair Value Accounting Rules Not to Blame for Financial Crisis - NERA Economic Consulting’s Thomas Porter says fair-value accounting rules cannot be blamed for causing the credit crisis, mainly because they did not require any new fair-value measurements. – Research Recap
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huge? – Banks Face Mark-to-Market Challenge – By DAVID REILLY – The war over mark-to-market accounting is about to get hot, again. In coming weeks, the Financial Accounting Standards Board is likely to propose that banks expand their use of market values for financial assets such as loans, according to people familiar with the matter. That departs from current practices in which banks hold loans at their original cost and create a reserve based on their own view of potential losses. – WSJ Heard on the Street
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The Folly Of Regulating Mega Banks – Tom Lindmark – Naked Capitalism has a really good post by Frank Portnoy, a professor at the University of San Diego, that discusses another aspect of the Lehman bankruptcy examiner’s report. …. Nine hundred thousand derivative positions! And Lehman’s size and complexity pales in comparison to Goldman, JP Morgan, BofA and their European brethren. Do you believe that anyone, including their managers, knows the true state of their of these mega banks financial condition? … – But Then What
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1336 pages! – Chris Dodd Financial Reform Bill Adds Layers of Oversight – By SEWELL CHAN – … But the bill, which would amount to the most sweeping change in financial rules since the Depression, would preserve much of the existing regulatory architecture, which has been criticized for being too fragmented. … – NY Times
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Barack Obama Has Ben Bernanke by the Balls – Posted by Larry Doyle – great thoughts, commentary, and replies – Sense on Cents
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Geithner: China will move on yuan without pressure - Treasury Secretary Timothy Geithner said Tuesday that he thinks China will eventually move to end the yuan’s peg to the dollar for its own reasons. "I think China will decide ultimately it is in their interest to move to a more flexible exchange rate," he said in an interview on Fox Business News. – Marketwatch