Financial Transparency

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Joined: Sat Aug 16, 2008 6:45 am

Financial Transparency

Post by jaxbmw »

As this financial mess implodes I sit here wondering about the degree of financial transparency in a company. I have to assume that auditors within a company sit down and try to understand the basis of investments, risks etc. I wonder if things have gotten to complex with all of these derivatives and leveraging for anyone to understand the true risk of a company, especially one that makes its money satisfying financial needs.

It sure looks to me that Warren Beffet's sage advice, if I can't understand the business and the risks I don't invest in it sure apply today. When all of this is said and done the financial sector is going to be a lot smaller than today, implying less companies and less employees.

I wonder if we could say that the bubble associated with this mess was evidenced by the largess in bonuses paid to some of the people creating this toxic soup.

hunkered down waiting for the next shoe to drop.
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