The retirement of FASB's long-serving chairman is no surprise. Eight years is a long time at the helm, especially when the last two involved a serious banking crisis in which accounting was a central concern. But Bob Herz kept a stiff upper lip and gave little quarter, even when playing defense and compromising where he had to.

When I interviewed Herz's predecessor, Ed Jenkins, he had clearly been through the ringer on everything from derivatives accounting to Enron. And it showed.

Jack Ciesielski has a new report out that puts banks' arguments against fair value squarely in their place. And the analysis alone should make short shrift of the industry's complaints, though it no doubt will do nothing of the sort.

The accounting expert and investment adviser who runs The Analyst's Accounting Observer finds that banks account for 96 percent of all the asset markdowns to the balance sheets of the S&P 500 that he estimates would result from enactment of the Financial Accounting Standard Board's latest proposal.

This trend has now reached California, so it's about to become a whole lot more meaningful.

Again, this may be a matter of paperwork, but at minimum, it seems like banks will have to spend time and money straightening out their claims to homes on loans they've securitized.

Bear with me here. This is going to be one of those "out there" posts. But Steve Randy Waldman takes an interesting stab at a problem I've been wrestling with, at least in the furthest reaches of the financial corner of my brain, since the financial crisis began.

And that is how to stimulate the economy without creating another asset bubble. It sounds easy enough to the Keynesians, but as Waldman has pointed out before, rebooting aggregate demand through traditional government action may simply create another bubble. And ultimately, the distinction between monetary and fiscal policy may be moot.

This brouhaha over the Boston Fed's rationalization for missing the housing bubble reminds me of a conversation I overheard a few weeks ago between a former Federal Reserve bank supervisor and his counterpart at the New York Fed.

I can't give you their names since they were conversing privately a few feet away from me before the start of a conference on financial regulation (nor can I give you the name of the confab since that would give their identities away), and I just managed to overhear the exchange.

This piece published today by Project Syndicate is as insightful a critique as I've seen of the consensus that has emerged among policymakers that government deficits must be cut to restore economic growth.

Not that we haven't taken a stab at that ourselves.

Barry Ritholtz today usefully repeats a point he made earlier this month in connection with an Andrew Ross Sorkin column about the SEC's proposed settlement with Citigroup and the court's refusal to go along with it.

And that is that shareholders of companies run by corrupt management are supposed to be punished.

I see that FASB is sticking to its schedule for ending most off-balance-sheet treatment for leases, and so is the IASB. It's about time, frankly, if only to spare us poor, I mean, intrepid financial journalists from having to sort through the particulars of the current accounting treatment a moment longer than necessary.

I speak from personal experience here, having wrestled with the false distinction between capital and operating leases for a sidebar to a piece I wrote for CFO Magazine way back when. The article delved into the details of a particularly complex variation that companies were using to finance real estate, called synthetic leases.

I have to disagree with my colleague Steve Taub on this, not because my heart bleeds for jobless, underwater homeowners, but to keep foreclosures from driving home prices ever downward.

Here's the thing: What is the "natural" price that Steve wants the market to find?

Banks' arguments against stricter capital reserve requirements seem to be getting a hearing from regulators such as Tim Geithner and the Basel Committee, but a recent paper suggests they should not.

This was alluded to in a blog today by Simon Johnson over at the Baseline Scenario, but the relevant passages are worth reading.