While this doesn’t address Democrat corruption or reform government requirements which obligate banks to make bad mortgage loans, it will help the balance sheets of businesses across the board. The SEC said it is modifying accounting standards so that an entire three months worth of good transactions aren’t marked down to equal the very last transaction made which could be at the odd fire sale price here and there. When asset valuations are marked down below a certain point a company becomes under-capitalized and looses creditworthiness and therefore access to capital. Thus collapse ensues. It is my understanding that Sarbanes-Oxley imposed the offending rules after the dotcom bubble burst.

What we have seen is that some perfectly good companies look great one day, then because of one bad transaction the balance sheet of the company indicates total collapse. If you run a dime store for example and you sell a $10 item for 10 cents suddenly the regulator comes in and says that your entire company is now worth 1% of what it was before the bad sale. They tell you you’re finished and force you to sell your entire inventory to competitors.

After the SEC’s rule change the bad mortgage will still be there bad with less destructive consequences.

Here’s the announcement:
http://www.nytimes.com/2008/10/01/business/01audit.html?_r=1&ref=business&oref=slogin
The stock markets should react favorably.

“Burning Down The House: What Caused Our Economic Crisis?”
http://www.youtube.com/watch?v=1RZVw3no2A4
Great companion video:
“Fannie & Freddie: The Real Story Behind The Economic Crisis”
http://www.youtube.com/watch?v=68D9XrqyrWo&feature=related

See TheMouthPeace profile page videos on YouTube, including “Covering”:
http://www.youtube.com/user/TheMouthPeace

OMG I am truly frightened for this country.

This is a classic case of the boy who cried wolf…pretty soon, no one is going to come to their rescue…I see an overthrow here and Pelosi and her Yes-men need to go…..

Anybody remember the cartoon “Mr Wizard” where the turtle would want to be something, get a chance and then get into some fix and call out for help?

Congress: There is no Mr Wizard! You screwed up and you need to give us a chance to figure a way out. NOW SHUT UP AND WORK!

The TV screen on the morning after is full of White House beggars imploring and warning. “We have to do something!” That’s not quite right. We have to do the right thing or we’re sowing the seeds for more chaos down the road. Doing something isn’t the same as doing anything and it sure doesn’t mean it had to the bailout plan they attempted to shove down our throats yesterday. The financial crisis is real and we have to act soon but it has to be responsible, effective, specific to the problems. We have to keep separation of powers intact and maintain the Constitutional framework of our republic.

Sweeping authorization to spend huge sums of money for the sake of its psychological value has clearly been rejected by the American people. The carnival put on by Nancy Pelosi and the Democrats yesterday doesn’t bespeak a genuine seriousness on their part. I fear time will run out on the House Republicans who are putting up a fight to stave off an ill-advised, rushed solution. It isn’t just your typical government solution to shoot wads of money out of a cannon. There is an attempt to radically increase the size and scope of government. A mistake today will take generations to correct, if ever.

90+ dems voted “nay” …. McCain went bipartisan and called in many more than the original 4 who supported the bill ….

I’m thinking that dems have set us up for their pre-announced “October Surprise” — in which Obama will now rush onto the scene and in a flurry of self-elevating verbosity — single-handedly and miraculously rally enough votes to save the federal government, Wall Street, main street America, the Global Economy and planet earth from collapse!!!!!

wow.

The amorality of the Left is unbridled and unchecked. We are headed for a showdown in the near future of all out cultural war for the survival of the Country.

The Left reminds me of the horror movies with the theme, “The Living Dead”, i.e., zombies with Other Directed controls.