Not only are the House Financial Services Committee and Senate Banking Committee holding hearings on the market meltdown and regulators’ response, the Senate’s Homeland Security and Governmental Affairs Committee (HSGAC) got into the act yesterday with its hearing on: Where Were the Watchdogs? Systemic Risk and the Breakdown of Financial Governance.
As explained in opening remarks by HSGAC Chair Sen. Joseph Lieberman (ID-CT), “We are undertaking this series of hearings pursuant to the Committee’s traditional ‘Governmental Affairs’ mission.”
However, the interest of the Homeland Affairs side of the committee also seemed apropos, given the testimony of Dr. Robert (Bob) Litan who compared the economic downturn to an ‘economic nuclear meltdown.’ Litan is vice president for Research and Policy at the Ewing Marion Kauffman Foundation and is a senior fellow in Economic Studies at the Brookings Institution.
Mark-to-Market Hearing Confirmed for March 12; Rep. Gerlach May Propose Legislation to Suspend MTM and Call for GAO Study
What had been rumored on Reuters a couple days ago is now confirmed: Late this afternoon, the House Financial Services Committee posted a link to an upcoming March 12 hearing on: Mark-to-Market Accounting: Practices and Implications. The hearing will be conducted by the Capital Markets Subcommittee, chaired by Rep. Paul Kanjorski (D-PA). Kanjorski’s subcommittee held a hearing this morning on Perspectives on Systemic Risk.
Rep. Jim Gerlach (R-PA), a member of the House Financial Services Committee, sent a letter to Treasury Secretary Tim Geithner and National Economic Council Director Larry Summers on Feb. 12, (see Gerlach letter to Geithner, Summers) with the text of a bill that Gerlach said he may propose, which would:
· Suspend mark-to-market accounting for two years, and
· Require a GAO study of mark-to-market accounting.
The blogsophere (and twittersphere?), like much of the rest of the world, is full of speculation on fair value (mark-to-market) accounting. See, e.g. Bill Sheridan’s discussion in the Maryland Association of CPA’s CPA Success Blog earlier today.
Read more about this week's (and upcoming) hearings on the credit crisis and regulatory reform here.