In his memoirs about the remarkable rise of The Home Depot, the great Bernie Marcus oh-so-thankfully went against the grain of seemingly all modern thought in writing that “bankers put their careers on the line, and for that we protect them.” Amen.
Cato Institute co-founder Ed Crane and I have been discussing mark-to-market accounting for banks in the aftermath of SVB’s troubles. Crane is not seeking force on the matter, but does think mark-to-market would render bank balance sheets credible where they’re presently not. My response is that regardless of what banks do, investors strive to mark to market.
In the technology sector, poorly-run businesses don’t last long. They fail quickly only for their assets to be acquired by better stewards. The paradoxical truth is that the technology sector gains strength from periods of weakness. It’s something to think about with banking top of mind. Failure in banking has become a dirty …