As BAC stock continues to fall, interesting perspective

[kevin4u2]

VIC write-up http://www.scribd.com/fullscreen/69599523

 

If it did, it would volunteer to use MTM accounting despite FASB's favors

 

They are being trusted with marking assets (FASB suspended MTM). Think they're doing an honest job?

 

This isn't true statements.  FASB 157 never eliminated MTM accounting.  MTM has to be used where there is a liquid market.  It allows other option for assets that do not have a liquid market. 

 

Secondly, why do you think the banks are recording increased earnings due to credit spread adjustments?  MTM accounting.  Media was all over this saying is all "accounting tricks" inflating earnings.

 

Anyone else notice the inconsistency with the arguments?  Banks get attacked if they use MTM or if they don't,... Which way does the analyst want it?

 

The analyst loses all credibility with such statements as highlighted above... Next.

 

Regards,

Kevin

[PlanMaestro]

I couldn't agree more.  I didn't waste 5 min thank god, but did waste about 2 1/2 min skimming it quickly.  This was more like a bad Seeking Alpha article than anything else.  There are so many problems with it I don't know where to start.

 

The problem is that there is so much crap out there that if someone makes a credible argument we might miss it.

[Santayana]

VIC write-up http://www.scribd.com/fullscreen/69599523

 

If it did, it would volunteer to use MTM accounting despite FASB's favors

 

They are being trusted with marking assets (FASB suspended MTM). Think they're doing an honest job?

 

This isn't true statements.  FASB 157 never eliminated MTM accounting.  MTM has to be used where there is a liquid market.  It allows other option for assets that do not have a liquid market. 

 

 

Who gets to define whether the market is liquid? 

[Kraven]

I couldn't agree more.  I didn't waste 5 min thank god, but did waste about 2 1/2 min skimming it quickly.  This was more like a bad Seeking Alpha article than anything else.  There are so many problems with it I don't know where to start.

 

The problem is that there is so much crap out there that if someone makes a credible argument we might miss it.

 

Agreed.  But unfortunately this kind of thing rings the bells for those looking for any kind of "support" for their arguments (in fact I think it led to a brief sell off this morning).  I do find it amusing that when someone writes a carefully researched short piece on a Chinese RTO, they are roundly criticized.  Yet, when a short piece is done on the financials, forget just BAC, it is considered a worthy addition to the debate, even though it is long on opinion and absent as to fact.  As Arsenio Hall used to say back in the day, this falls into the "Things that make you go hmmm" category.

[Guest Hester]

VIC quality has been questionable of late. There was an aweful long writeup of a chinese RTO recently that I actually contacted VIC about wondering how such a terrible writeup could get in.

[BargainValueHunter]

http://blogs.wsj.com/deals/2011/11/03/35397/

 

The debt of Bank of America and most other banks has declined in market value in recent months. Because of debt-market bumpiness, Bank of America said it is “economically advantageous” right now to consider buying back some of its junior bonds and its preferred stock.

 

Bank of America says it may have a Plan B — buying back some of the preferred stock and bonds. The benefits of such a move include saving money on preferred-stock dividends and on bond-interest payments.

 

Another advantage, Bank of America said, was the bank can boost its capital levels. The disadvantage, of course, is some dilution for common-stock holders.

 

Anybody know how this affects the TARP Warrants?

[Uccmal]

http://www.sec.gov/Archives/edgar/data/70858/000119312510044940/d424b7.htm

 

I am not totally clear on the effect of minor stock issuance.  Give it a read.