The devil is in the details

The crisis is on everyone’s mind. You got to be abnormal not to think about the effect that it may have on your assets.

However, a small little worm has expectedly crawled upon the nest holding our feeble financial system.

You see, the bigger the bank the bigger the punch. Big money rules in politics.

The New York Times blogger Floyd Norris alerted us that the International Accounting Standard Board has just this week allowed banks to engage in a bit of accounting trickery so as to conceal their real market value of their assets.

During a crisis they can now “legally” find ways to do a little bit, or a lot, of window dressing.

We are not yet out of the gates. In fact the horses are not even ready and the long and bony fingers of lobbying pressure has tended its almost invisible web of deception.

What a pity!

The rules seem to apply to Europe, but that is irrelevant, money goes where profits are higher. You relax the rules there and boom, money floods like a river of blood.

Meanwhile, we are all concerned with the enunciation of Sarah Palin or the theatrics behind McCain’s house of pain.

The change in this rule allows banks to adjust the value of their assets retroactively to July, so that all of the sudden their books will look better.

And isn’t that convenient?

Just when the multinational rescue plan is not working, it then may actually work.

The devil is in the details. This change in the way banks do their accounting is not just a mechanical change. It came about from political pressure of the ever more monopolized and thus powerful financial institutions.

Now, you go right ahead and try to regulate these gigantic monsters.

— Luis Brunstein