Tsafi

[popeyej]

MBoomer, I graduated from the number one rated business school in the country but at the time that I attended it was ranked third. I was well known in the construction field and found that I could do much better there so I never really worked as an accountant but used the education as a hobby in the investment field.

The article that you posted is correct. Not writing down bad investments as they take place is a road to disaster. It inflates the balance sheet and makes the company appear to be much stronger than it really is.

My accounting training is what made it easy for me to spot the disaster that was about to take place in the banking system around the US. It was not only the sub prime loans that took the banks down but also the derivatives that numbered in the trillions that was nothing more than a gamble that went bad. If true value accounting had been applied during this time the impending disaster could have been spotted by any layman and hiding the problem would have been impossible.

The only bank that I named that did not go under or have to be taken over was J P Morgan Chase. I did say that they would last longer because of their excellent cash flow but the 1.28 trillion in derivatives added to the sub prime loans makes it a candidate for the same result as the other banks. I believe that the US economy must turn around this year or J P Morgan will be another disaster added to the list.