As we eulogize two legendary Wall Street firms today and have several others on-watch to receive last rights, I can only think that more could have -- and should have -- been done to prevent this financial homicide. What I'll call "firmslaughter."
If Lehman Brothers were an individual instead of a corporation, its "bankruptcy" would undoubtedly have been avoided.
Even the acquiring knight from Charlotte said Merrill Lynch had the abilty to ''see their way through'' the current crisis.
You know why? Because this is a crisis of our own making. Or more specifically, a crisis in which the accountants have become executioners and FASB 157 is the murder weapon.
What You Must Know:
Believe me, I am not absolving Wall Street and/or Main Street of their excesses but I am trying to strongly say that the era of mandated mark-to-markets, billion dollar writedowns and subsequent ''losses'' is largely the fruit of our own well-intentioned but misguided efforts.
To force asset writedowns in the middle of a financial hurricane is like telling Galveston homeowners that they had sell before sunset.
Or your real estate agent informing you that since no one bid on your house today...you have to lower the price to zero.
We can debate the pros and cons of accounting changes all day but I think we would agree that they are an evolving work in progress and also more art than science.
And it is for that reason that the Fed, the Treasury, the SEC, the White House or somebody should have stepped up and said, wait a second -- we are allowing (read as "forcing") viable, productive businesses/employers to go under.
We all know that the securities in question are not truly worthless. In fact, we often joke that somebody is going to swoop in, buy 'em up and make a lot of money at some point. The truth is, they are only temporarily unpriceable because people are afraid and unwilling to buy them right now.
But to euthanize by lethal accounting? That's just not right.