Geithner’s plan is the biggest condemnation of Mark to market accounting yet, and by association, also a condemnation of government officials and academics who favor M2M accounting. The whole purpose of providing a trillion dollars of financing to private parties steams from the realization that there is not enough capital in the private system, that assets are depressed not due to belief in their true economic value, but due to the lack of capital. Why is that Treasury officials and other academics who are rolling out this financing plan are also the ones who believe in MTM accounting? Truly baffling.
Geithner tries again