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By Relaxing “Market-to-Market†Rules, Has the U.S. Switched Off its Financial Crisis Early Warning System?
By relaxing the U.S. financial system’s mark-to-market accounting standards, the U.S. government is effectively deactivating the financial “early warning system” that let investors know that a global credit crisis was brewing – and kept it from turning into a total global meltdown, professional investors warn.
As part of the just-passed U.S. bailout bill, the government has reiterated the Securities and Exchange Commission’s authority to relax the mark-to-market standards. If the SEC actually follows through on that directive, many professional investors worry that we won’t catch on to the next leg of the ongoing credit crisis until it’s way too late.
While politicians…
8Oct2008 | Money Morning | Comments Off | Continued
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