Comments on: 2009 Capital Markets Summit: The US Chamber of Commerce http://retheauditors.com/2009/03/11/2009-capital-markets-summit-the-us-chamber-of-commerce/ The Business of the Big 4 Audit Firms Thu, 24 May 2012 01:48:07 +0000 http://wordpress.org/?v=2.9.1 hourly 1 By: re: The Auditors » Blog Archive » In Case You Missed It…Virtually Out And About http://retheauditors.com/2009/03/11/2009-capital-markets-summit-the-us-chamber-of-commerce/comment-page-1/#comment-78778 re: The Auditors » Blog Archive » In Case You Missed It…Virtually Out And About Wed, 13 Jan 2010 15:04:02 +0000 http://retheauditors.com/?p=1260#comment-78778 [...] added a big quote to Going Concern.com’s Satyam Anniversary post. What do we know about the scandal one year later – its causes and how to prevent similar frauds [...] [...] added a big quote to Going Concern.com’s Satyam Anniversary post. What do we know about the scandal one year later – its causes and how to prevent similar frauds [...]

]]> By: re: The Auditors » Blog Archive » BDO International - Yellow Card or Red Flag? http://retheauditors.com/2009/03/11/2009-capital-markets-summit-the-us-chamber-of-commerce/comment-page-1/#comment-4963 re: The Auditors » Blog Archive » BDO International - Yellow Card or Red Flag? Thu, 21 May 2009 02:26:45 +0000 http://retheauditors.com/?p=1260#comment-4963 [...] I’m constantly amazed to find Grant Thornton’s CEO Ed Nusbaum acting as the designated spokesboy for the accounting industry all over the place. He probably drew [...] [...] I’m constantly amazed to find Grant Thornton’s CEO Ed Nusbaum acting as the designated spokesboy for the accounting industry all over the place. He probably drew [...]

]]> By: Linda Lowell http://retheauditors.com/2009/03/11/2009-capital-markets-summit-the-us-chamber-of-commerce/comment-page-1/#comment-2477 Linda Lowell Thu, 12 Mar 2009 13:22:00 +0000 http://retheauditors.com/?p=1260#comment-2477 Traders' market, investors' market, shmarket. Splitting the wrong hair. It's a traders' market when the investors leave, and the investors began leaving long before the assets were marked to frozen - no, investor-less - markets. Investors left much as they left in 1987 or 1998, in a "flight to quality" fueled by a risk aversion that was as deep as their yield greed before. The most troubled market (and the basis for trouble in CDO, ABCP, SIV etc.), the private MBS market, ballooned by low interest rates and then teaser rates in preposterous loan vehicles, relied for its value on the underlying housing market. Once that housing market stopped rising - in late 2005, 2006, depending what locality and what index you reference - the least committed (fraudulent, entirely dependent on repeated cash out refinancings to maintain life style/debt) began bailing. The investors who understood this problem began retreating as well. The investors who looked at yield and rating (in that order) - the CDOs, SIVs, etc. - kept on buying. It was only in 2007, as the mortgage banking units that made and lost money servicing (etc) the most credit-leveraged and untenable loans began to fail, that the broader market woke up. The plain fact is not that marking to market destroyed wealth that still exists if only the auditors would use the right model, but the wealth was artificial, it has begun to evaporate and will continue to evaporate. Until the decline in housing markets & now decline in employment and household incomes stops, prudent investors (which even the previously risk-loving have become) are unable to evaluate with any reliability expected returns on any of these "troubled," "distressed," "illiquid" assets. The risk premia therefore are very wide, the market values deservedly low. That is how market works. Anything else would be the emperor's new clothes. Traders’ market, investors’ market, shmarket. Splitting the wrong hair. It’s a traders’ market when the investors leave, and the investors began leaving long before the assets were marked to frozen – no, investor-less – markets. Investors left much as they left in 1987 or 1998, in a “flight to quality” fueled by a risk aversion that was as deep as their yield greed before. The most troubled market (and the basis for trouble in CDO, ABCP, SIV etc.), the private MBS market, ballooned by low interest rates and then teaser rates in preposterous loan vehicles, relied for its value on the underlying housing market. Once that housing market stopped rising – in late 2005, 2006, depending what locality and what index you reference – the least committed (fraudulent, entirely dependent on repeated cash out refinancings to maintain life style/debt) began bailing. The investors who understood this problem began retreating as well. The investors who looked at yield and rating (in that order) – the CDOs, SIVs, etc. – kept on buying. It was only in 2007, as the mortgage banking units that made and lost money servicing (etc) the most credit-leveraged and untenable loans began to fail, that the broader market woke up. The plain fact is not that marking to market destroyed wealth that still exists if only the auditors would use the right model, but the wealth was artificial, it has begun to evaporate and will continue to evaporate. Until the decline in housing markets & now decline in employment and household incomes stops, prudent investors (which even the previously risk-loving have become) are unable to evaluate with any reliability expected returns on any of these “troubled,” “distressed,” “illiquid” assets. The risk premia therefore are very wide, the market values deservedly low. That is how market works. Anything else would be the emperor’s new clothes.

]]> By: admin http://retheauditors.com/2009/03/11/2009-capital-markets-summit-the-us-chamber-of-commerce/comment-page-1/#comment-2476 admin Thu, 12 Mar 2009 12:59:09 +0000 http://retheauditors.com/?p=1260#comment-2476 @Edith Orenstein Thanks Edith. I will write more after today's hearings and after I have a chance to digest your report and the actual transcript. Today's hearings should be very interesting. ;) @Edith Orenstein Thanks Edith. I will write more after today’s hearings and after I have a chance to digest your report and the actual transcript.

Today’s hearings should be very interesting. ;)

]]> By: Edith Orenstein http://retheauditors.com/2009/03/11/2009-capital-markets-summit-the-us-chamber-of-commerce/comment-page-1/#comment-2475 Edith Orenstein Thu, 12 Mar 2009 12:50:19 +0000 http://retheauditors.com/?p=1260#comment-2475 FM-your coverage of Chamber's Cap Mkts Summit is excellent. You included a particularly significant comment by NYSE-Euronext Chairman Niederauer, that it's become a trader's market, not an investor's market. This, together with his observation about the role of market psychology, has tremendous implications for markets generally, and mark-to-market in particular. I posted your tweet in the comments section of the FEI blog today, "Testimony Posted..." I thought it was so important. FM-your coverage of Chamber’s Cap Mkts Summit is excellent. You included a particularly significant comment by NYSE-Euronext Chairman Niederauer, that it’s become a trader’s market, not an investor’s market. This, together with his observation about the role of market psychology, has tremendous implications for markets generally, and mark-to-market in particular. I posted your tweet in the comments section of the FEI blog today, “Testimony Posted…” I thought it was so important.

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