muses of the moment

March 12, 2010

And the accounting tricks go on….

Zerohedge (.) com has a great article about the latest accounting trick, Repo 105.

Click here.

And as Tyler says…other banks are doing this same thing right now. Nothing is fixed and the cover-up continues. Investor beware.

This is a game of musical chairs, but there appears to be over 300 million investors and 2 chairs (and Goldman Sachs is always sitting in one of them). Investor beware. Invest in tangible assets. Yes, I know the stock market is going up, groovygirl says…investor beware. Click here.

Here is the chartoftheday¬†for the PE ratios of stocks. The PE ratios say that stocks are cheap. Are they? The above accounting tricks and with the gov allowing legal accounting fudging, how can we trust PE ratios (the earnings-E part)? We can’t.

This is an example of long time trusted stats, that can not be trusted anymore (until the accounting gimicks are stopped). But investors (and investment managers) are still working off this system. Investor beware.

Side musing: FDIC takes down a bank on a non-Friday? Click here.


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