Mark to market?

[Larry Gude (Premo)]

Originally Posted by Tilted

I have mixed feelings about the mark to market issue, .

Give me one good reason in favor of mark to market?

[somdrenter]

Originally Posted by Larry Gude

Perfect! You got it.

So then, once purchased, the value can never be less than purchased price. Excellent.

[Larry Gude (Premo)]

Originally Posted by somdrenter

How are you to value your assets that are on the books? What they could be in the future, what they are worth right now, what I say they are worth, what someone else says they are worth, once purchased at $XX they are always worth at least $XX, or current market value?

I see your caveat of “at least a quarter”, but stocks are traded daily.

If you can see the point of valuing things quarterly, then you are well on the way to a much more reasonable regulation.

Gasoline is a great candidate for mark to market. A house is one of the worst. Tilted's post gets much better into the nuts and bolts and the thought process.

The question needs to be asked; where the hell did this STUPIDITY come from? It was the over reaction to the practice of simply lying about your books that was so rampant in the 1990's. We don't make small corrections, we make huge ones that create new problems without really fixing the intended problem.

[Larry Gude (Premo)]

Originally Posted by somdrenter

So then, once purchased, the value can never be less than purchased price. Excellent.

Nonsense. Revalue 'it' once a quarter. Once a year. Depending on the asset.


Gas? Sure. Every day.
A house mortgage? Once a quarter.

[somdrenter]

Originally Posted by Larry Gude

If you can see the point of valuing things quarterly, then you are well on the way to a much more reasonable regulation.

Would we then not also trade quarterly?

[Larry Gude (Premo)]

Originally Posted by somdrenter

Would we then not also trade quarterly?

Make a point instead of just flailing about, please.

If you're looking at buying a share of AIG, is it reasonable to see a massive drop in their assets because they wrote a policy to Lehman on mortgages that went from $1 billion on January 1 to $500 million six months later, based on mark to market?

It's a recipe for volatility, not accuracy OR good investor information.

[Larry Gude (Premo)]

Originally Posted by somdrenter

Would we then not also trade quarterly?

Perhpas you or I might wait for a quarterly report before we buy.

[somdrenter]

Originally Posted by Larry Gude

Gas? Sure. Every day.
A house mortgage? Once a quarter.

Toothpaste? Tires? Trash bags? Autos? 2x4’s? Socks? Gold? T-Shirts? Oil? Watches? Brick? Compact disk? Coffee mugs? Paper Clips? Windshield wiper fluid? Big Macs? Corn? Chickens? etc….etc..etc….etc…..

[Larry Gude (Premo)]

Originally Posted by somdrenter

Toothpaste? Tires? Trash bags? Autos? 2x4’s? Socks? Gold? T-Shirts? Oil? Watches? Brick? Compact disk? Coffee mugs? Paper Clips? Windshield wiper fluid? Big Macs? Corn? Chickens? etc….etc..etc….etc…..

OK, so flail about and don't make a point.

[This_person]

Originally Posted by Larry Gude

Perfect! You got it.

Given this, wouldn't most new car loans be "toxic assets" for at least the first year of car loan?