The Death of Wall Street. Part 2

Searching for Sanity

Wall Street’s business model is broken. The high stakes game of Russian roulette which Wall Street never seemed to lose, is taking them down one by one. Commercial banks aren’t in much better shape either. In fact, the business model of the entire financial system is broken. And the pain is only going to get worse.

Facing pressure from the Federal Reserve and the SEC, in July the Financial Accounting Standards Board withdrew a newly passed rule requiring banks to book their assets at current market value. Why was this rule rapidly withdrawn? Quite frankly, because it would have made every major bank insolvent.