My point is, I detect a trend going on to try to boost confidence in the system. The government (Congress, at least) pretty much forced the independent accounting-standards board to change its rules to the benefit of banks and to the detriment of investors. The Obama administration hasn’t exactly been true to his campaign-season pledges of transparency. At least two banks’ accounting procedures have raised legitimate questions.
All this happy talk is counterproductive. What the markets need now is radical transparency, and journalists should demand it. If we find out things aren’t that bad, prices bounce and we move on. If we find out (as I suspect) that they are, then we’re force to take quick action to once and for all clean up the mess.
To be clear, I agree that the banks’ situation improved considerably in the first quarter. I just think journalists need to be on top of what looks like a concerted effort to pretty things up to look better than they really are.