Subject: File No. 4-573
From: Jason Edgtton

October 28, 2008

The effects of mark-to-market accounting on financial reporting by financial institutions in times of fear may well enhance short term negativity in the market and lead to extream results as clearly seen recently.However in a stable market, the mark-to-market accounting principle provides critical information to the investment community as to the current asset quality.

Potential market behavior effects from mark-to-market accounting in the short term can lead to extream volatility.However in the long run if companies are held accountable for their asset investment quality by the mark-to-market accounting principle, companies will be forced to justify their actions to their share holders.Any high risk policy that produces a negative outcome is currently seen clearly and early.The outcome should not be hidden just because it is unfavourable to the company directors future ability to remain an employee of that company.

The usefulness of mark-to-market accounting to investors and regulators has previously been shown by the market selling down those companies with very questionable assests, any permanent deviation of the truth will only serve the self interests of company directors to hide and further manipulate the current and future share holders.

Aspects of the current accounting standards that can be improved.In times of extream volatility it would seem to be a good idea to question the usefulness of mark-to-market accounting, however just because the truth hurts is no excuse to hide it.However, one aspect to improve could involve placing a maximum percentage decline that could be taken against the relevant assets in any one quarter.This would have the effect of spreading the bad news over a longer period, reducing the panic and lowering the volatility in any given quarter.This would be in the best interests of the investor,companies and the markets.
While this is only one international investors personal view, i believe this situation can be turned into an oportunity for change.

I have recently read a book called Soft power by Joseph S Nye Jr, this gives an insight into how individuals,groups and Govt's have been co-opted in the past and will be in the future to make very questionable decisions that are not always in the best interest of those involved.I would highly recommend this extreamly relevant publication.