By Matthew Philips
For Newsweek.com
To most people, it’s an arcane accounting rule. But to bankers, it’s the whole ballgame: “mark to market” pricing is the practice of requiring banks to value their assets based on their current market value. Not what banks paid for those assets yesterday. Not what they could get for them in, say, a year or two when the financial industry has settled down. What they could get right now. Which is basically bubkes. Banks have been pleading for this requirement to be lifted since the credit crisis began, and last week they got their wish. Confused? Here are four things you need to know about “mark to market” in order to sound smart at a cocktail party…
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