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Goldeneye Morning Paddle – 9/15/2009

September 15, 2009

Good morning!

 Will the FASB reverse its stance on legalized accounting fraud mark-to-market rules?  From WSJ:

The Financial Accounting Standards Board is weighing a plan to require U.S. companies to value most financial instruments by the ups and downs of the market – notably loans, which make up much of banks’ assets. That’s more stringent than an International Accounting Standards Board plan to allow non-U.S. banks to value loans at adjusted historical cost – a higher number that would give banks higher shareholder equity than under FASB’s plan.  The two boards have been trying to “converge” their differing sets of accounting rules and work toward one set of rules to apply to companies worldwide.  But FASB Chairman Robert Herz said that would be hard in this case, and left open the possiblity that it ultimately might not happen here.

Take your meds, save $290b?  WSJ notes a recent report by the New England Healthcare Institute which finds just that:

An estimated one half to one-third of Americans don’t take their medications as prescribed by their doctors, the research group says, contributing to about $290 billion a year in avoidable medical spending including excess hospitalizations.

NEHI, which gathered a group of experts in a roundtable on patient medication adherence in July, found that there are many reasons besides side effects that patients don’t take their medicine: cost, the challenge of managing multiple prescriptions, cultural issues, forgetfulness and a reduced sense of urgency if they don’t feel any symptoms. Generally, adherence rates are lower among patients with chronic conditions; since 75% of U.S. health spending now goes to treatment of chronic diseases, poor adherence “should be seen as a serious roadblock to improved efficiency in the health care system,” the report concludes.

Among the proposed solutions are reducing the cost of drugs used to prevent or manage chronic diseases, simplified drug regimens, better patient education and closer monitoring of patients on medication by case managers.

Read my lips, v2009:  Coyote calls out team Obama on his “firm” no tax increase on the middle class pledge:

“I can make a firm pledge….no family making less than $250,000 will see any form of tax increase…..not any of your taxes”-Barack Obama, September 12, 2008

Oops, well, so much for that, as Obama imposes a 35% tax on Chinese tires, requiring higher prices be paid by the majority of Americans.  This is a broad-based tax aimed at supporting one narrow American industry, as a payoff to the United Steel Workers who have been sad that the UAW has been getting all the political gravy of late.

Suppose the Chinese government is massively subsidizing tire exports — that they are taking Chinese taxpayer money and directly applying it to tire exports to reduce prices in the US.  What should our response be?  Mine would be:  Thanks, suckers.  If the Chinese really want to tax their people to subsidize lower US consumer prices, why in the world would we want to stop them?

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