No task is more thankless than to write about accounting for a family newspaper, yet it must be shared with the public that "mark to market," an accounting and regulatory innovation of the early 1990s, has proved another of Washington's fabulous failures -- that is, if the goal were curing market uncertainty through "improved" accounting practices. The atmospherics around the big subprime write-downs currently roiling Wall Street tell the story.

Start with Merrill Lynch's giant $15 billion write-down of mortgage-related securities in January, which CEO John Thain introduced with a curiously contradictory "I think we're being conservative, but I don't think that we're likely to get much back on these things." Mmm. Either Merrill's write-downs are conservative, in which case many of the assets will come back, or they aren't. Is it any wonder Wall Streeters kibitzing about possible spectacular "write-ups" once the credit crisis passes point to Merrill as a top candidate?

Or take AIG's unexpectedly large write-down of subprime paper on Friday, blamed for the market's sell-off. Its chief told the world that its mortgages on paper had lost $11 billion in value, but sotto voce predicted these "unrealized" losses would eventually correct themselves.

Or take Sam Zell, a real-estate investor whose pronouncements are given great weight in the markets. He pooh-poohed the red ink being liberally spilled on Wall Street, saying, "It's not a cash crisis, it's a 'mark' crisis," and predicted that write-ups would undo much of the damage once the "panic" subsides.

None of this should be surprising. Overstating the importance of accounting rules is, indeed, the essential error that leads to excessive twiddling with accounting rules. Whether a company values its assets at historic cost or market value or a value derived by some other formula, investors still have to make their own forecasts and judgments. A thermometer is equally useful whether it says water freezes at 0 degrees or 32 degrees -- though it still doesn't tell what the temperature will be next week.