Fair value accounting's blind spot

Market prices ignore time-to-liquidation, says David Rowe


Arguments over the proper basis for valuation seem as old as recorded history. Until comparatively recently, they were deeply entangled with ethics and religion. Today, in most parts of the world, the ‘right’ price is understood to be that which balances quantities supplied and demanded in open and competitive markets. Over the past 30 years, accounting standards have shifted from the purported objectivity of amortised historical cost to embrace mark-to-market pricing. While I am broadly

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