... in 2004, when the bubble could have been stopped before it got so out of hand.
Read it over at JDA.
The Dirty Fed told FASB and SEC not to crack down on banks' Enron-style accounting
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And actually, WCV, the way I read the article implied that not only did the Dirty Fed say FASB should not crack down, it essentially strong-armed them into NOT treating bank balance sheets that way. Is that surprising? No.
I'm wondering, then, why FASB instituted 166 and 167 which will essentially force banks to bring these financial monsters back on sheet. It does not make sense. I did not understand when FASB made the announcement why the Fed would encourage this move knowing what it would mean for banks' capital requirements but now I totally get it.
Well not guilt so much as hoping if FASB reversed the decision, no one would notice that they were the ones who told them to keep SPEs off sheet in the first place.
Duhhhhhh it's all so clear to me now :P
This isn't directly related but there were other examples of the "driving that train, high on cocaine" attitude of regulation. As early as 2004 the FBI was being warned that there was widespread fraud happening in the mortgage business and they really didn't start cracking down in earnest until the horse had left the barn.
Now, you can open R. Dollars blog and find numerous headlines every day from all over the country of people getting busted for things that drew little if any attention to just 6-7 years ago.
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