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America's North Shore Journal » Entries tagged with "credit crunch"

Mark to Market Changed for Now

October 1st, 2008 | Comments Off

One of the accounting rules that has created this “crisis” is called mark to market. What that means is that securities are to be valued at the price they could be sold for at market. It allows a company to recognize that its investments have appreciated, or sadly, depreciated in value. The credit market got tied up when major players refused to buy at prices they viewed as too low. If you cannot sell a security, it has zero value. Suddenly, banks and other institutions held massive amounts of mortgage securities with no apparent value. As has been demonstrated here, they do have a value, but the refusal to buy and sell at those values shut the credit market down. Companies went bankrupt due to their losses in securities marked to market. The SEC … Read entire article »

Filed under: American Economy, Commentary, Original writing

Financial Disaster Coming?

September 28th, 2008 | Comments Off

Read this. Send it to all your friends. Send it to your enemies and even strangers. This is the absolute truth about the Congress. No bull. Steve Schippert posts at Wizbang: We are witnessing a failure in government. Our Congress cannot work together to provide an immediate fix to a problem it created in the first place: forcing the American financial sector to extend mortgages to those who were high risk borrowers in order to champion to the American people that more minorities own homes than ever. That worked well under a booming economy. But when the natural cycle of economics turned downward, fear dismissed became reality unavoidable. The house of cards came tumbling down. And even still, amid all the haggling and fighting going on in Congress over how to shore up … Read entire article »

Filed under: American Economy, Other Bloggers