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Strategies & Market Trends : Value Investing
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To: Spekulatius who wrote (42285)4/15/2011 10:39:57 AM
From: E_K_S  Read Replies (1) of 78717
 
When do you see the banks going back to "mark-to-market" accounting? Isn't this a type of fraudulent accounting? I see that several of the large banks (ie. JPM) are juicing their earnings by reversing a portion of their bad loan reserves back into one time earnings. This is just accounting w/ mirrors and things are not really any better than they were 18 months ago.

It's been discussed that using the good bank and bad bank as a means to isolate these bad loans but I do not see how this will be resolved. I suspect the end game will have the Fed ending up with these losses on their books and the $US dollar debasing.

Any way I look at it, the exit strategy has the Fed and $US absorbing these bad loans not the large mega banks. I think it would have been better to break up several of these mega banks and decentralize the sector into several smaller companies. This will never happen.

EKS
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