Are creditex and markit reliable? Do people routinely take issue
with their amounts (like I do with blue book on cars?)
--- In AsburyPark@yahoogroups.com, "radio881gal" <[EMAIL PROTECTED]>
wrote:
>
> Tommy -
> Not sure if here you're referring to my post about the Wall St.
> bailout.
> If you are, I'd want to say that there are indexes by Creditex and
> Markit, which contain traded prices on Credit Default Swaps (CDS)
> and Collaterolized Debt Obligations (CDOs). Paulson doesn't want
> taxpayers paying the low prices the professional traders are
> currently paying for these. He's already said he wants taxpayers
to
> buy these assets at future maturity rates. Wasn't that what Asbury
> Park residents wanted and didn't get in the redevelopment and
rehab
> zones?
> Maureen
>
> --- In AsburyPark@yahoogroups.com, "justifiedright"
> <justifiedright@> wrote:
> >
> > How do you use Mark to Market accounting when dealing with an
asset
> > that is not widely traded? You have no data upon which to set a
> > value.
> >
> > Also, when a firm goes under and is selling off their assets at
a
> > fire sale, is it fair to use those sale numbers when someone
else
> is
> > valuing an asset under Mark to Market?
> >
> > Maybe the realty experts on the board can opine.
> >
> > If only we had someone on the board who regularly dealt with
burden
> > of valuing unique property? :-)
> >
> >
> >
> >
> >
> >
> >
> > --- In AsburyPark@yahoogroups.com, "asburycheech"
<asburycheech@>
> > wrote:
> > >
> > > Hi Folks,
> > > Maureen Nevin who is a member of this group is having an
issue
> > with
> > > her internet connection, so she asked me to pass along the
> > following.
> > > She has a lot of good information on her asburyradio.com
> website,
> > but
> > > hoped those interested might like to read the following as
well:
> > >
> > > ---------- Forwarded message ----------
> > > From: Jay Hyde <jhyde@>
> > > Date: Tue, Sep 30, 2008 at 3:12 PM
> > > Subject: CAQ Urges Congress to Reject Proposals to Suspend
> > > Mark-to-Market (Fair Value) Accounting
> > > To: maureen@
> > >
> > >
> > > September 30, 2008
> > >
> > > Dear Member of Congress:
> > >
> > > The Center for Audit Quality (CAQ) believes that proposals
> > advocating
> > > suspension of mark-to-market (or fair value) accounting are
not
> in
> > the
> > > best interest of investors or the capital markets and should
be
> > rejected.
> > >
> > > The principles of mark-to-market accounting are rooted in the
> > > fundamental virtue of transparency and are central to informed
> > market
> > > decisions and efficient allocation of capital. In our view,
> > investor
> > > confidence would be undermined by efforts designed to mask the
> > actual
> > > value of financial assets at a given point in time.
> > >
> > > It is important to underscore that mark-to-market accounting
has
> > > contributed positively to revelations about the severity of the
> > > economic crisis facing our country's credit markets and certain
> > > institutions, but it did not create the economic crisis.
> > >
> > > Recently, some have suggested that the Securities and Exchange
> > > Commission (Commission or SEC) or the Financial Accounting
> > Standards
> > > Board (FASB) should suspend the application of mark-to-market
or
> > fair
> > > value accounting or somehow impose a moratorium on mark-to-
market
> > > requirements for certain financial institutions when preparing
> > > financial statements to be used by investors.
> > >
> > > Although determining fair values for financial instruments in
an
> > > illiquid market can be challenging, the best estimate of the
> prices
> > > that would be received for such instruments in orderly
> transactions
> > > occurring at the measurement date remains the most relevant
> > > information for investors and policymakers. To lessen the
> > > uncertainties about the value of these securities, it is
critical
> > that
> > > investors continue to have the insight provided by the
> application
> > of
> > > mark-to-market accounting principles.
> > >
> > > Many of the current requirements stem from the Savings & Loan
> > crisis
> > > in the 1980s, when we learned that not knowing the real,
current
> > > values of financial instruments held by financial institutions
> can
> > be
> > > devastating when the bubble finally bursts and institutions
are
> > forced
> > > to close their doors. The current requirements provide a
uniform
> > and
> > > consistent method to measure market values and provide
investors
> > > increased disclosures about those measurements. Suspending
> > > mark-to-market accounting would throw financial reporting back
to
> a
> > > time of less comparability, less consistency and less
> transparency.
> > >
> > > If there are concerns with the impact of asset valuations on
> > capital
> > > requirements of financial institutions, regulators have
> > alternatives
> > > other than obscuring information relevant to investors.
> Regulators
> > may
> > > modify those requirements based on criteria other than fair
value
> > > accounting measurements to the extent they deem appropriate.
> > >
> > > Other capital markets participants also have expressed
concern
> > about
> > > the lack of transparency that would be created by a suspension
of
> > > mark-to-market accounting. The Council of Institutional
Investors,
> > > which represents 130 public, corporate and union pension funds
> with
> > > combined assets of more than $3 trillion, stated in a recent
> > letter to
> > > the SEC that "[a]ny termination or suspension of fair value
> > accounting
> > > will lessen transparency and investor confidence in the capital
> > > markets at a time when such confidence is critical to the
> > stability of
> > > our markets and the overall economy."
> > >
> > > Likewise, the CFA Institute, a global, professional
association
> of
> > > more than 97,000 investment professionals with offices around
the
> > > world, recently wrote to both members of Congress and the SEC
and
> > > noted that "[c]easing fair value reporting will only serve to
> > > undermine the confidence of investors in our financial
> institutions
> > > and lead to a further crisis of confidence in our government
and
> > the
> > > regulatory bodies overseeing those institutions."
> > >
> > > The proposed Emergency Economic Stabilization Act of 2008
> restates
> > > the authority of the Commission to suspend the application of
> > > Statement of Financial Accounting Standards No. 157, Fair Value
> > > Measurements (FAS 157), and requires that the Commission
conduct a
> > > study on the effects of FAS 157 on financial institutions'
balance
> > > sheets, the impact of such accounting on bank failures in
2008,
> the
> > > quality of financial information available to investors, and
other
> > > matters, and report its findings to Congress within 90 days.
> While
> > a
> > > restatement of existing SEC authority and a study of mark-to-
> market
> > > accounting and its effects are not necessarily harmful in
their
> own
> > > right, efforts to weaken the transparency provided by the
current
> > > standard should be avoided, especially in this time of
financial
> > > instability.
> > >
> > >
> > > The CAQ would be pleased to discuss with you any of the points
in
> > this
> > > letter at your convenience.
> > >
> > >
> > >
> > > Sincerely,
> > > Cynthia M. Fornelli
> > > Executive Director
> > > Center for Audit Quality
> > >
> > >
> > >
> > >
> > >
> > > Cc: Henry M. Paulson, Jr., Secretary, Department of
Treasury
> > > Ben S. Bernanke, Chairman, Federal Reserve
> > > Christopher Cox, Chairman, SEC
> > > Mark W. Olson, Chairman, PCAOB
> > > Robert H. Herz, Chairman, FASB
> > > All Members of Congress
> > >
> > > The CAQ is an autonomous public policy organization serving
> > > investors, public company auditors and the capital markets and
is
> > > affiliated with the American Institute of CPAs. The CAQ's
mission
> > is
> > > to foster confidence in the audit process and to aid investors
> and
> > the
> > > markets by advancing constructive suggestions for change
rooted
> in
> > the
> > > profession's core values of integrity, objectivity, honesty
and
> > trust.
> > > Based in Washington, D.C., the CAQ consists of approximately
800
> > > member firms that audit or are interested in auditing public
> > companies.
> > >
> >
>
------------------------------------
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