[revel]

There was a question last week about mark-to-mark accounting for banks in the wake of the SVB failure. The question was (to paraphrase): why aren't banks forced to mark every asset for every financial statement. This article pretty comprehensively describes why such a thing is not really possible, let alone desirable.

In regards to this article, I have to laugh at the asset managers holding cocos who thought that they were trading pseudo-warrants. I respect the shamelessness of these guys to try and blame other people for their own mistakes -- a lot of portfolio managers were successfully able to convince investors that their losses during the GFC were due to the ratings or govt agencies -- but they're not going to convince the central banks to eat the losses on this one. There is absolutely no incentive to make Swiss taxpayers eat tens of billions of losses because some fund manager didn't read the literal name of the instrument he was buying.