That is, the accounting model requires that profits and losses be recognized in that year. During the financial crisis, many financial instruments suffered a decline in fair value, resulting in numerous losses appearing on the income statement. Recognition of losses can lead investors to overreact, further worsen circumstances and thus lead to crisis. However, although loss recognition in fair value changes can reinforce investor overreaction during an adverse economic situation, fair value accounting is simply one of the accounting tools available to entities for reporting their operating strategies, the implementation and results. I don't think it's right to blame the crisis on the method. In fact, in my opinion, it is the people involved in inappropriate activities who should be blamed. Banks, businesses and authorities could have better supervised lending and mortgage securities transactions so that the crisis was not so severe.