The Barclays dilemma
This one is really hard. On the one hand, Barclays announced that they don't need more capital, and that their earnings are strong. (Bloomberg story here: Barclays letter to investors here.) And obviously one does not want to do a Peston, and spread irresponsible rumours. But there is still a nagging suspicion that there is something rank* about their balance sheet -- that they may have been less than honest about all their writedowns. I suppose this is yet another accounting problem: once suspicions arise that a bank might be abusing accrual, it is very hard for them to convince everyone that they are clean.
* But not as rank as a Durian, obviously
Update. Up 73% in one day. Wow. Just wow.
* But not as rank as a Durian, obviously
Update. Up 73% in one day. Wow. Just wow.
Labels: Accounting
posted by David Murphy at 08:34
1 Comments:
Exactly the same thoughts occur to me. There is something that just doesn't smell right about Barclays. they appear to have been up to their necks in the proverbial yet claim to be smelling of roses. I actually wonder if the board really understand the business that they are in, they seem tremendously confident of there own marks (usually a worrying sign). I once met a friend of a colleague who since he retired had done some work for Barcap on risk management an did not have a very high opinion of the place (this was 6 or 7 yrs ago though), I also on occaison run across auditors who also seem overwhelmed by the complexity.
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