So says Ritholtz, here:
- stuffed with declining assets
- eliminating Fair value accounting via FASB 157 did not fix balance sheet problems, but instead allowed banks to hide them
- management does not keep adequate capital
- management and traders still have the same upside to roll the dice, but do not have the downside risks, which remains on shareholders and taxpayers
The rest of the entry provides a good summary of how a bad bank should get seized and carved up instead of zombie-fied as in current practice.
