The FASB will be making an announcement on Thursday around the market open regarding a change in accounting rules regarding valuing the toxic loans on banks balance sheets. If they either rescind or change this rule, we should see the banks and financial stocks advance.
This new rule will be effective for the first quarter 2009 reporting. So the effect will be immediate and be reflected in their quarterly financial reporting which will be occuring over the next 4 weeks
Great call so far, but this has been on the schedule for quite awhile now. Wouldn't tomorrow be sell-on-the-news time? Plus, won't better-looking balance sheets effectively give banks the green light to call-in their loans to other banks, in a re-acceleration of bank-to-bank margin calls on all this derivative stuff.
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