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Пишет Андрей Янпольский ([info]yanis)
@ 2009-04-02 12:57:00

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FASB - federal accounting standards bullshit

April 2 (Bloomberg) -- The Financial Accounting Standards
Board, pressured by U.S. lawmakers and financial companies,
voted to relax fair-value rules that Citigroup Inc. and Wells
Fargo & Co. say don’t work when markets are inactive.
(c) Bloomberg News 04/02/09

FASB is Federal Accounting Standards Board.
In plain english it means the following. Case at hand: Citibank. It claims to have $1.94 Trillion in assets as of December 2008. Almost 1 trillion is listed as marketable securities, 710B in loans and 200B in "intangible assets, mortgage servicing rights" and other crap.
So these so called "marketable securities" and loans are valued at 1.7 trillion dollars according to the Citibank's own valuations (pricing models). The old FASB rule required that all securities be marked to market - as in objectively priced according to current market rates for comparable paper. If a particular bond is being sold for 10 cents on a dollar today it means that a holder oh 1 million bucks in these bonds effectively only has 100K, not a million. The current number of 1.7 trillion is not fully compliant with the fair market value rule - a lot of securities haven't been marked down. We don't know what percentage. The today's vote lets the banks keep making up prices for their assets officially.
So, as far as a layman is concerned, Citi states 1.9T in assets and who knows what share of it is in bullshit non-marketable junk debt and loans that will never get paid - let's say 30-50% - so Citi overstates it's assets by 550-850 billion dollars (prove me wrong - show me the books), the truth may be a lot worse.

In the same time between 2009 and 2014 the "bank" has around 200B of outstanding debt principal maturing (this doesn't include coupon payments). In other words they need to pay $200B by 2014.

So, right now on paper Citi says it has 1.9 trillion in assets, 300B in long term debt (200 due by 2015) , 540B in short term debt and 775B in deposits... Total liabilities according to it's statement are 1.79T versus the stated assets of 1.9T - healthy bank right? Now replace 1.9T with 1.3T - they're 500 billion dollars under water.

Very similar calculations apply to *any* large banking institution. This is a gigantic sham, a big lie, which they (the executive branch, the legislature bought by the banking industry, the banking industry) choose to perpetuate. We the people are trying to spend and lie our way out of depression. Good luck to us. We deserve the consequences.

(Добавить комментарий)

2009-04-03 10:51 (ссылка)
your math is cold, and not patriotic enough!


2009-04-07 00:29 (ссылка)
300B + 540B + 775B = 1.615 T, not 1,79.