Andrew Ross Sorkin of The New York Times scores an interview with Blackstone Group chief Stephen Schwarzman, who’s running around town saying an accounting rule is to blame for much of the severity of the credit crisis. Sorkin thinks the whining is so amusing he can hardly keep from laughing in print.

A little background: Back in November, the Financial Accounting Standards Board passed a new rule called FAS 157 that forced companies to “mark to market”, which means to adjust how they value their assets to what they can be sold for. Before, companies could pretty much determine their own values by tweaking their computer models that determined values.

Schwarzman and others say the new rule isn’t fair because it’s forced banks to write assets down further than they should be written down, exacerbating losses and causing them to have to raise billions in capital that dilutes the value of their shareholders’ stock. He’s got some twisted logic. Because there is no market for much of this junk (things like collateralized debt obligations that are stuffed with CDOs that are stuffed with mortgage-backed securities that are stuffed with defaulting subprime mortgages), Schwarzman is saying the writedowns have gone too far.

If that’s the case, though, why doesn’t Blackstone step up and start snatching up all these low-balled securities? Sorkin asks that very question.

For Mr. Schwartzman’s part, he says that the banks haven’t been willing to unload the investments at the distressed prices. Besides, the diligence required for most buyers is almost too complicated.

Barry Ritholtz over at The Big Picture pretty much sums it up:

Therein lies the foible of Schwartzman’s Folly, for if you own marketable securities for which there is no market, then by definition, these are not really marketable securities.

How then to price all of this paper on the books? Why, just rely on the people who bought them in the first place! Never mind that they don’t understand what they own, they failed to do their due diligence before buying this garbage in the first place.

Sorkin, interestingly, reports that Goldman Sachs used mark-to-market accounting all along. Guess what? It’s had the least trouble of any of the big banks.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.