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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: Boca_PETE who wrote (5302)5/31/1998 10:21:00 PM
From: kahunabear  Read Replies (1) of 42834
 
Pete,

BTW, when I asked the question:

If accounting principles do what they are supposed to do, shouldn't book value be a reflection of the value of underlying net assets ?

I was trying to get your feeling on whether book value SHOULD be some reflection of the value of net assets(assets minus liabilities). I agree that it may not. I think this relates to our earlier discussions about how an income statement SHOULD accurately reflect a company's profit. I think in some cases it may not. In other words, if a balance sheet is not always a good representation of assets and liabilities, then perhaps the income statment is not always an accurate representation of earnings. It probably makes more sense to discuss specifics like stock options and special charges. Perhaps I have exhausted the subject. Anyway, it has been interesting hearing your perspective.

Thanks,
WS
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