Wednesday, October 01, 2008

Nerd News, Financial Apocalypse Edition: Wachovia Bank Freeze Affects 900+ Universities

The Chronicle of Higher Education reports that the Wachovia bank freeze affects over 900 American colleges and universities. Terrifying quote:
Wachovia bank has frozen the accounts of nearly 1,000 colleges, leaving institutions unable to access billions of dollars they depend on for salaries, campus construction, and debt payments.
AAACKKK!! I want my paycheck!!!

1 comment:

Anonymous said...

THIS is what the bailout is about, Maddie. The country needs a functionng banking system. I think we're going to have to hold our noses and do it.

What we DON'T have to do is stand still for billion-dollar bonuses or enormous CEO pay packets. The idea to remove tax deductbility for salaries over $400K is a decent start, though I would set the figure somewhat higher than that - perhaps $1 or 2 million seems right.

This wouldn't actually outlaw higher salaries - it would just mean that over that amount you can't deduct it as a cost of doing business.

Another thing occured on Tuesdy which was little remarked. The SEC issued a 'clarification' on the 'Mark to Market' rules for valuing securities stating that securities could be valued by their expected return over time if there was no market. This eases the immediate pressures on banks to sell these things into a crisis market.