US Politics: They're Gunnin' 4 Us

[Paxter]

I am not aware of any issues with SVB's accounting.

This just looks like poor market risk management (overexposed to an IR rise) coupled with obscenely poor preparation for and management of a liquidity crunch. At fault are the management team and the regulators. 

[James Arryn]

6 hours ago, Chataya de Fleury said:

I admit that I saw your initial comment as the typical snide remark Montrealers used to throw at me over the years about how fucked up the US is is (any time there was a mass shooting in the US, for sure). I was a Temporary Resident of Montréal on a work visa for two years, so basically lived there.

I then combined that with my frustration on how many people on the Board see “late stage capitalism” (aka the current US economy) as “MAGA”, which is just not so. That foregoing is super personal to me, while I believe the above would be familiar to any American who has significant cross-border ties.

Seeing the U.S. as some sort of “doom and gloom no matter what turns out” is what I call “unhelpful”. Sure, you can’t vote here or influence what happens here, but not even a “thoughts and best wishes”?

Ah, okay. It was both more and less than your initial reaction suggested. Less in the sense it was not in any way a snide remark or intended to take a swipe, and moreover it was only tangentially connected to this latest bank crisis. It was more that I had been thinking about recent events….East Palestine, the banks, etc. and it was starting to seem to me to be approaching a kind of inevitability for Trump to win; all the excuses are there for one of those classic ‘let’s get back to the objective business adult in the room who can make the tough choices’ Schlick which almost always means ‘rich man’ regardless of how he got it or how far he deviates from the actual conservative model’ moments in US/western history. And the resultant I.R. assessment/father of 3 year old girls/nuke anxiety/China ~ escalation kind of boiled my fears down to their essences, which was what I described is in my initial post. 
 

Moreover my Canadian comment was absolutely not meant in the ‘looking down my nose’ way’…I am guilty of occasional outbursts of serious criticisms I have of especially US foreign policy, but this wasn’t that. This was very much more ‘this affects us all’ kind of sharing the dread kind of comment, especially as it’s mainly domestic problems recently. I suppose if I dig deep enough there will probably be some anger at the constancy of being in a situation where US fuckery negatively affects so many people around the planet who have no voice in the lunacy unfolding regardless of how it affects them (which often exceeds how much it affects Americans themselves) but I swear that’s just something I feel I’ll be able to find because I’ve felt it many times before*, but it was not at all how I was feeling when I posted above. 
 

But, lastly, about the ‘but not even thoughts and best wishes’ because I can’t vote/ergo non-American: is this the standard for commenting on the political situation in the US in a US Politics thread? No? What about if it is interpreted of being critical of the US? Still, no? So what is it about me or my comment’s not being ‘thoughts and best wishes’ that makes that the bar I’m supposed to meet? Something about…not voting there? Something about criticizing the US and not being American? Well, if so this has got to be a first for me, never met an American who gets super hostile at the criticisms of their country’s actions by foreigners regardless of how much those actions do or could affect non-Americans. This might even be the first time anyone has encountered this phenomenon, if that’s what this is, I’m still not 100% sure I’m reading you right here.
 

If wrong, sincere apologies but much confusion over what that last bit meant. Am having a really rough few weeks, at home, might be hypersensitive. 

 

*The late John Le Carre had a nice phrase for American attitudes towards the effects of their foreign policy on non-Americans from my POV, close as I can remember: ‘The victims who survive never forget because they cannot, but the conquerors forget, and all too quickly’.

Edited March 14 by James Arryn

[IheartIheartTesla]

According to a Daily Show segment, Fox News (this is second hand, since I would never watch F'N myself) thinks SVB failed because it was a 'woke' bank. One of the examples given was the month long DEI initiative they had just before it failed, no idea yet how they connected the dots between the two.

 

[DanteGabriel]

3 hours ago, James Arryn said:

nice phrase for American attitudes towards the effects of their foreign policy on non-Americans from my POV, close as I can remember: ‘The victims who survive never forget because they cannot, but the conquerors forget, and all too quickly’.

"The tree remembers, the axe forgets" is accurate to many human interactions, both individually and on a societal level.

[Madame deVenoge]

10 hours ago, Wilbur said:

Are the F/S presented in accordance with GAAP?  Probably.  Can the public accountants speak to relevant enterprise risks for the company?  Doubtful.

Exactly, no one should be asking auditors to also have an actuarial science degree and a risk management background. That’s not what they are there for.

Are the financials presented properly in accordance with GAAP? Well, great, let’s move on.

That does include a Going Concern analysis (all of which are bullshit) and any Critical Audit Matters, as previously mentioned.

[Wilbur]

7 hours ago, Chataya de Fleury said:

Exactly, no one should be asking auditors to also have an actuarial science degree and a risk management background. That’s not what they are there for.

Are the financials presented properly in accordance with GAAP? Well, great, let’s move on.

That does include a Going Concern analysis (all of which are bullshit) and any Critical Audit Matters, as previously mentioned.

The issue with this is that achieving the "F/S presented in accordance with GAAP" is well below the expectations set in the board meetings by the partners who presented their bid for the work.

The partners, at least one of which will never be seen again once the sales presentation is complete, promise that the public accounting firm will divine great insights based on their wide industry experience applied to the careful analysis of the financial records of our company.  They will be partners to us, providing us with invaluable guidance and counsel, sending to us staff with impeccable knowledge and experience, and performing their work with such tight scheduling and light touch that we will hardly know they exist until it is time to whisper their key business acumen into our shell-like ears.  Every member of the board can rest easy in the knowledge that the millions paid to the public accounting company will be repaid many times over in valuable wisdom and critical counsel.  Our business will become the world leader in our industry, and at least one of us will likely be elected Pope.

And at the end of their actual work, the CFO and controller remark that after a titanic struggle to get the audit staff to locate their own backsides with both hands, consistently appear at regularly scheduled meetings, complete work by mutually-agreed deadlines, provide clear status reporting, or actually read documents provided to them, the only item of any significance that came out of the public accountants' work was an argument over semantics that boiled down to the audit manager failing to keep on top of their email with our staff.

This mismatch between expectations and reality is the problem.  The managing partners of the Big 4 want everyone to perceive them as trustworthy business advisors with deep and extended experience, and that their ability to opine on the F/S is also the ability to provide surety to investors as to the value of the company.

But the actual things that they and their staff do don't support that image at all.  Partners took from the Arthur-Andersen-and-Enron-experience the lesson that it was critical to change the focus of SOX into something they could do cheaply and to use the Act as a gun at the heads of company boards to embed themselves to extract maximum cash.  Rather than using sections 2 and 4 to really do what they claim to do, they turned it into a self-licking ice cream cone.

And it is frankly soul-destroying work for anyone in the Big 4 who isn't a partner.  Staff approach our controllers or CFO staff and inquire about opportunities, and when I ask if they have any real technical skills, they answer is, "Not anything we don't already possess in our own team."  Do they have any leadership potential?  "Well, they work to deadlines replicating prior year work, so nothing I have seen."  Therefore if they come into our organizations, it has to be as an individual contributor to develop technical and industry skills and uncover any latent leadership skills, but this likely means they will not be paid as well as their current role.  And thus most Big 4 staff remain manacled to the mill until they find a place where they do have some sort of comparative or absolute advantage.

I am on this hobby horse again because I had lunch with the daughter of a friend recently who will graduate with her Masters and start with one of the Big 4 in June.  It didn't take the whole lunch before I could say to her, "I believe that you will be counseled out before two years, just based on your active personality and intellectual curiosity.  And if you aren't, get out just as soon as you qualify for your CPA, and go to work in an industry that interests you.  Don't get chained to the mill."  

[Madame deVenoge]

@Wilbur - good thinking.

Your friend’s daughter should absolutely make Senior and maybe Manager at the Big 4, but it’s generally value-added to leave after that.

I make more money than some Big 4 audit partners (I used to do their tax returns, on a tax rotation). So, it’s really not all that remunerative, and they can barely invest in anything due to the independence rules.

[Mlle. Zabzie]

2 hours ago, Chataya de Fleury said:

@Wilbur - good thinking.

Your friend’s daughter should absolutely make Senior and maybe Manager at the Big 4, but it’s generally value-added to leave after that.

I make more money than some Big 4 audit partners (I used to do their tax returns, on a tax rotation). So, it’s really not all that remunerative, and they can barely invest in anything due to the independence rules.

Just as an aside, I've heard the compensation gap is one of the reasons why EY's Everest is on life support.  The audit folks want a lot more value to give up their share of the consulting.

[Martell Spy]

Trump and GOP attempt to reverse course on mail-in voting ahead of 2024

https://www.cnn.com/2023/03/15/politics/trump-republicans-mail-in-voting/index.html

Quote

Trump, now waging his third White House bid, told attendees at the Conservative Political Action Conference earlier this month that it’s time to “change our thinking” on early and mail-in voting. And in speeches and fundraising emails, he’s touting his campaign’s plans to encourage “ballot harvesting,” the practice of allowing third parties to collect and turn in other voters’ ballots. His party, he said, has “no choice” but to beat “Democrats at their own game.”

 

[Deadlines? What Deadlines?]

 

[Madame deVenoge]

18 hours ago, Mlle. Zabzie said:

Just as an aside, I've heard the compensation gap is one of the reasons why EY's Everest is on life support.  The audit folks want a lot more value to give up their share of the consulting.

To give you an idea of the compensation gap - even in the consulting arm, salaries are lower than in industry.

My EY offer (Senior Manager in a consulting role) was $170k with maybe a 10-15% bonus and four weeks of vacation.

Not compelling.

[DireWolfSpirit]

Zuckenberg doing another huge round of employee cuts at Meta, announcing a layoff of 10,000 more employees.

That amounts to roughly 12% of Meta’s workforce and follows the company’s firing of 11,000 employees in November.

Edited March 15 by DireWolfSpirit

[Fragile Bird]

I understand people are now worried about Credit Suisse, after the Saudis said they aren’t interested in putting more money the bank, as that would put them over 10% thresholds that trigger regulatory complications.

The stock price is down 20% today in NY, to $2.00 a share.

Edited March 15 by Fragile Bird

[A Horse Named Stranger]

16 minutes ago, Fragile Bird said:

The stick price is down 20% today in NY, to $2.00 a share.

That's quite a stock to beat them with.  <- Nailed it.

[ThinkerX]

Team Biden decided to jump into the University mess. I can see assorted profit based educational institutions screaming 'entrapment.'

 

That said, the University situation in Florida is looking downright frightening. How long will it be before DMC is arrested as a subversive and whisked away to a reeducation center?

Biden Admin Is Placing Undercover Federal Agents At Universities. Here’s Why (msn.com)

 

• The Enforcement Office of Federal Student Aid (FSA) will use undercover officials to monitor colleges and universities for misleading or predatory practices, the Department of Education announced on Tuesday.
• The officials will identify any “misrepresentations” in several factors advertised to students including “transferability of credits, job placement rates, completion and withdrawal rates, graduates’ future earning potential, career services, the cost of attendance, the amount of federal student aid, and accreditation status.”
• “We support reasonable practices that hold all institutions accountable for misrepresentations that financially harm students and taxpayers; however, the federal government has a track record of using secret shopper investigations to malign politically unfavored institutions with distorted findings that later result in the need for public correction,” Nicholas Kent, Career Education Colleges and Universities chief policy officer, wrote in response to Tuesday’s announcement.

[Varysblackfyre321]

On 3/14/2023 at 4:33 AM, IheartIheartTesla said:

According to a Daily Show segment, Fox News (this is second hand, since I would never watch F'N myself) thinks SVB failed because it was a 'woke' bank. One of the examples given was the month long DEI initiative they had just before it failed, no idea yet how they connected the dots between the two.

 

Same way they cried the spill in East Palestine was due to North folk being woke.

Honestly companies can rest easy knowing all they have to avoid substantive criticism and possible legal consequence for their actions is to have one thing conservatives can call woke to all the problems on. Like just having a black Person be in a position of authority.

Edited March 15 by Varysblackfyre321

[Zorral]

Greg Abbott's taken over the entire public school system of Houston, the TX Dem stronghold.

What this looks like from over here (Europe) about the US is utterly chilling.  Again, the US fascist-nazis crashing US as fast as possible to all out shooting war for control of everything.  US not a good country for your children.

Edited March 15 by Zorral

[ThinkerX]

1 hour ago, Zorral said:

Greg Abbott's taken over the entire public school system of Houston, the TX Dem stronghold.

What this looks like from over here (Europe) about the US is utterly chilling.  Again, the US fascist-nazis crashing US as fast as possible to all out shooting war for control of everything.  US not a good country for your children.

Problem is the Houston school district was forced to acknowledge serious issues with the way they were running things, thus providing a measure of justification. Now the burden of improvement rests on the state. Be interesting to see if they can manage that.

 

[Fragile Bird]

Now I see Republic Bank assets have been downgraded to junk status and the head of Blackrock predicts this is going to be a slow moving crisis with more bank seizures to come. 

[Larry of the Lake]

Congratulations to Michigan for repealing "right to work".