Tag: Accounting

JPMorgan and Deutsche Bank account for about 20 per cent of total global derivatives exposure. The risks associated with these exposures are largely netted out. But how well? Your guess is as good as mine, and probably not much worse than those in charge of these institutions.

There is never such a thing as a single true and fair view, only a range of possible outcomes. To assess a value from the mean outcome is as meaningless as the observation that the average person has 1.99 legs.

It is a poor criticism of a thermometer that it does not tell us how comfortable we feel.

Although transactions with low probability of large loss and high probability of small gain carry the potential for disaster, they can appear attractive for a very long time – perhaps for ever.

The Olympiad was a good party, which cost the British population about £200 per head.

What happened at Enron, and in the banks, was that trading assets were marked to values that had been established not by people who knew about the contracts or the loans, but by the biased and ill-informed assessments of the traders.

Corporation tax is a tax on corporate activity and on shareholders, and it is not well designed to achieve either purpose.

British law might have said that the duty of directors is simply to promote the interests of the company’s members. But it doesn’t – and that is no accident.

For a time, the coalition government seemed willing to let figures tell their own story rather than one written by their political advisers; but that time seems to have passed.

Ireland accounts for a share of global profit disproportionate to the size of the Irish economy. Not because business in Ireland is particularly successful but because reporting profits in Ireland is particularly attractive.