Chronicles Of Depression 2.0: #292: WTF? 2
In Chronicles Of Depression 2.0: #290: WTF?, I wrote:
The new drumbeat — it began last week, but has gotten louder since the FAILout — is Mark-to-Market rules set up in the Sarbanes-Oxley legislation.
If the advocates of rescinding a provision of that Act are to be believed, this is what’s preventing the “price discovery” Treasury Secretary Paulson has stated is essential.
Further, if that rule change was made, there would be no need for the proposed $700B bailout.
Now other experts are saying, No, that won’t work, either.
At the end of 2001 it was revealed that its reported financial condition was sustained substantially by institutionalized, systematic, and creatively planned accounting fraud, sometimes called the “Enron scandal”. Enron has since become a popular symbol of willful corporate fraud and corruption.
After a series of revelations involving irregular accounting procedures bordering on fraud perpetrated throughout the 1990s involving Enron and its accounting firm Arthur Andersen, Enron stood on the verge of undergoing the largest bankruptcy in history by mid-November 2001(the largest Chapter 11 Bankruptcy until September 15, 2008 was of Lehman Brothers).
In addition, the scandal caused the dissolution of Arthur Andersen, which at the time was one of the world’s top accounting firms. The firm was found guilty of obstruction of justice in 2002 for destroying documents related to the Enron audit and was forced to stop auditing public companies.
Experts are saying no way will auditors allow themselves to fall into that possible trap, despite what the S.E.C. itself is saying by issuing a memo to clarify accounting valuation practices.
The real answer, these experts insist, is not the Paulson $700B scheme, not revising Mark-to-Market, but stock ownership — via Preferred Shares — in distressed companies in order to recapitalize them.
My head continues to spin.
What I’ve heard on the news regarding the proposed Senate-amended version of the Paulson scheme is that corporate tax breaks have been infiltrated into them to make this bitter pill a bit sweeter for the Republicants who don’t know who they should be serving. As if corporations needed even more ways to avoid paying what individual Americans are required to do!
Is anyone else getting the idea none of these people know WTF needs to be done?C.O.A.T. - Belief, C.O.A.T. - Money, C.O.A.T. - Politics, C.O.A.T. - Scams, C.O.A.T. - Self-Defense, Depression 2.0, Politics