In 1975, the SEC said that debt had to be rated by one of seven ratings agencies. That number is now three, I believe (Moody's, Fitch, S&P's.) We saw how well they did with their ratings.
The FDA has a legal monopoly on saying what drugs, etc., are safe for market, yet they allow numerous drugs that have been proven ineffective and/or unsafe and explicitly state they have no intention of changing.
Now it seems at least from this that the FASB has a monopoly on determining what accounting standards are used, and it seems like they've gone exactly the same way as the ratings cartel and the FDA.
Rolling Stone:
The Pig in the Poke also came into play in April of last year, when Congress pushed a little-known agency called the Financial Accounting Standards Board, or FASB, to change the so-called "mark-to-market" accounting rules. Until this rule change, banks had to assign a real-market price to all of their assets. If they had a balance sheet full of securities they had bought at $3 that were now only worth $1, they had to figure their year-end accounting using that $1 value. In other words, if you were the dope who bought a cat instead of a pig, you couldn't invite your shareholders to a slate of pork dinners come year-end accounting time.
But last April, FASB changed all that. From now on, it announced, banks could avoid reporting losses on some of their crappy cat investments simply by declaring that they would "more likely than not" hold on to them until they recovered their pig value. In short, the banks didn't even have to actually hold on to the toxic shit they owned — they just had to sort of promise to hold on to it.
That's why the "profit" numbers of a lot of these banks are really a joke. In many cases, we have absolutely no idea how many cats are in their proverbial bag. What they call "profits" might really be profits, only minus undeclared millions or billions in losses.
Goldman's "flash trading"
[...]The SEC voted to ban flash trading in September, but five months later it has yet to issue a regulation to put a stop to the practice.
[...]Six months after a federal prosecutor admitted in open court that the Goldman trading program could be used to unfairly manipulate markets, the bank released its annual numbers. Among the notable details was the fact that a staggering 76 percent of its revenue came from trading, both for its clients and for its own account. "That is much, much higher than any other bank," says Prins, the former Goldman managing director. "If I were a client and I saw that they were making this much money from trading, I would question how badly I was getting screwed."
[...]That's why the biggest gift the bankers got in the bailout was not fiscal but psychological. "The most valuable part of the bailout," says Rep. Sherman, "was the implicit guarantee that they're Too Big to Fail."
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