"Bluntly, we have institutionalized accounting fraud. . . ."

[peristaltor]

solarbird gives what appears to be an excellent (but way over my head) analysis of the current market rally in her journal today. One of the many links had the quote in my subject line, Mark To Myth Losers: Americans posted by Karl Denninger.

He gives a frightening run-down on how many losses from foreclosures and defaults the banks are failing to report, often against the regulations requiring such reporting:

The bottom line here folks is as I have been hollering about for over two years: Banks and other institutions are carrying paper at FAR beyond its reasonable fair-market value - or that which it will EVER realize under any reasonable set of assumptions going forward.

Bluntly, we have institutionalized accounting fraud and the so-called "regulators" that are supposed to put a stop to and even prosecute these acts are willfully and intentionally ignoring them. The cities and towns across America are the big losers where these practices cause blight through intentional neglect while these "banks" claim to be in far better financial condition than is in fact the case.

In addition, this willful disregard for the truth means that these bankrupt institutions remain in the system as "zombies", unable to perform their critical role in credit intermediation. (Emphasis, this time, by the author)

This can't end well. My question is simple: Why is this info hidden only in the bowels of the intertubes? This indicates our current economic troubles are going to be far worse than the cheerleaders on the telly are suggesting.