In the sense that some companies will be saved from “failing”, you may have a point. But on the other hand, if the market was being rational — rather than valuing their assets at zero — they would not fail.
What Paulsen contemplates is really having the government be a “rational” buyer when the nonfunctional market is being irrational.
“What Paulsen contemplates is really having the government be a “rational” buyer when the nonfunctional market is being irrational.”
I never worked in real estate, but always thought that revaluing assets at market held as much danger of misleading a financial statement user as valuing everything at cost. I think I’d prefer that things be valued at cost, then any material changes be reflected in footnotes. Of course, the requirement to mark to market might have started because of failures to disclose significant changes in values in footnotes.
Do you know how long the mark to market has been required, and is it an annual report requirement, or is it required more frequently?