Agreed. I read it and at first the looser standards they talk about sound like they would be even easier to exploit.
Then I got to this part and it hit me:
“Real Estate: companies can revalue certain assets to fair value.”
Notice it didn’t say de-value, but re-value.
Initially you’d think to mark down underperforming RE assets, but what’s to stop companies from hoarding say, foreclosed homes, “revaluing” them at a “fair” value (what determines fair) and booking gains in an asset worth less then the loan against it?
I’m no accountant so I’m probably missing many other benefits but it doesn’t sound like it would prevent much of the debacle we’ve seen.
