Regular readers know I have had little use for the opinions of mid-life crisised, sometimes presidential candidate, sometimes magazine publisher, sometimes, but only when it suits him, free market capitalist, yet full time poster boy for the "lucky sperm club" Steven Forbes.
His rants way back as the markets were in meltdown that this financial debacle we are in, (yes contrary to mainstream propaganda we are still in it!) was simply a crisis of liquidity and that a simple removal of onerous, outdated, and inconvenient rules of mark to market accounting would solve everything in a jiffy. This removal is more commonly referred to as marking to fantasy and is a widespread practice among financial companies today.
Regular readers know I have and still do vehemently disagree with Mr. Forbes and the rest of the crowd echoing his shallow, sophomoric and simply idiotic remedies to our economic ills.
I have long argued, as many idiot bloggers in the blogosphere have as well, that this is NOT a crisis of liquidity but rather one of solvency. So for any out there like Mr. Forbes who still cling to the notion that this is simply a liquidity issue and ignoring mark to market will solve everything I offer up this article today by Jonathan Weil over at Bloomberg entitled Suing Wall St. Banks Never Looked So Shady.
Please read the article. You will start to understand why I have been so critical of the mark to fantasy proponents like Mr. Forbes and his comrades in arms Bill Isaac (former FDIC chairman.. and you wonder why FDIC is in the pickle it's in) and of course Larry Kudlow.
I anxiously await their myriad number of excuses as to why mark to market is still a bad thing even in the face of this evidence. My guess is that mark to myth is still their preference simply because they say so as the born-with-a-better-pot-to-piss-in-crowd everywhere and always are the smartest guys in the room. Makes me think of the quote from George Orwell who said;
"In times of universal deceit, telling the truth will become a revolutionary act".
Good speculating to you all and please remember to never forget that "an investor is a speculator who made a mistake and will not admit it".
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