The prospects the the reform and possible for suspension of mark to market accounting rules are looking brighter this morning. About an hour ago, at 10 am, the House Financial Services Subcommittee began its hearings on the issue. Right off the bat, the chairman of the panel signalled strong support for reform.
Congressman Paul Kanjorski said he might force the hands of the Securities and Exchange Commission and the Financial Accounting Standards Board by introducing legislation to require reform. This is a 180 degree turn for Pennsylvania Democrat, who had previously said Congress shouldn’t intervene in establishing accounting rules such as the so-called mark-to-market standards now at issue.
The news of this stance is spreading across trading floors. It is generally viewed as a strongly bullish sign, providing relief to troubled financial institutions that may be in peril of falling under regulatory captial and reserve requirements.