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U.S. Bank Shares: Pump Almost Over, Get Ready for the Dump

I enjoyed the phrase "massive dilution" without any perspective on what you consider "massive". Is that 30%? or 1%? or something in between?

FASB Changes Perpetuate Fair Value Lying

The "lying" was really in forcing banks to book paper losses before they occurred (and when they might never occur) on illiquid assets based on a temporary market crisis. This killed the banks and perpetuated the crisis. Lifting Mark to Market will be hailed as the turning point for the economy. Not all will be rosy from here, but this allows the markets and the marketplace to heal. Some banks will and should fail, but for the most part this was a fictional crisis crated by two stupid rules: mark to market as applied to the banks and the elimination of the uptick rule.

The FASB Rally: More Dishonest Breathing Room For Banks

The "dishonesty" was really in forcing banks to book paper losses before they occurred (and when they might never occur) on illiquid assets based on a temporary market crisis. This killed the banks and perpetuated the crisis. Lifting Mark to Market will be hailed as the end of this crisi period. Not all will be rosy from here, but this allows the markets and the marketplace to heal.

The NY Times on Bank Nationalization

Best solution is the one proposed by Forbes: Return to sanity. Get rid of Mark to Market for Banks, let them recognize losses when they occur (ie loans go into default) rathe than making them take fictitious paper losses that destroys the capital base because loans "might" go into default.
FDR suspended mark to market in 38 and it was not reinstituted unitl 2007.
These "insolvent" banks have more cash on hand then they have had in a long time. It is the unrealized "paper losses" that are killing them. One should note that Jamie Dimon has refused to sell JPM's "toxic" assets because they are not toxic -- only temporarily without a market. If forced to sell, they become a real loss. If held to maturity they are probably worth close to par. After the great depression, the Feds 1) suspended mark to market for banks because it distorts asset values if the market becomes illiquid and 2) instituted the uptick rule to rein in short sellers.
Those actions were reversed in 2007 and look where we are.