>Or rather, why is it that we allow a bank to not mark-to-market a security for which there is a liquid market? I agree with your main point. You'd have to be

>Or rather, why is it that we allow a bank to not mark-to-market a security for which there is a liquid market? I agree with your main point. You'd have to be careful with regulation around this, because what you might end up with is banks preferentially seeking assets for which there is not a liquid market so they can pretend they are worth more. That's... not an obvious improvement.