So Fannie Mae is again embroiled in serious accounting Doodoo. And remember Berkshire Hathaway's exposure to General Re's derivatives business which in last year's pullout, cost Berkshire Hathaway $104 million pre-tax and brought its aggregate losses from exiting the derivatives operations to $404 million. As a result, Warren Buffett was forced to write to investors warning about the evils of derivatives. Motley Fool gives a good analysis of his letter and explains why derivatives markets are so dangerous and unsustainable.

With all that, it's worth asking whether accounting is just a shell game. What have we really learned since Enron and WorldCom? Has Sarbanes-Oxley stopped dodgy accounting?

In FallStreet.com, Brady Willett and Todd Alway pose the question and answer: What's New with the Accounting Shell Game? More Shells and it's a chilling read.

"Suffice to say, more than 4-years after Enron - and with the trials of Skilling and Lay finally starting - accounting restatements continue to balloon higher each year, and the SEC has yet to prosecute a major case of 'certification' fraud (a recent study by Glass, Lewis and Co. tallied 1,295 restatements in 2005, or more than triple the amount the year S-O was passed). Along with ballooning restatements new and much needed accounting standards on goodwill stress tests and pension accounting are still in limbo, and no one has the temerity to seriously tackle derivatives transparency."

The corporate response is to obfuscate and confuse investors with financial reports the size of War And Peace, only not as readable. As for the media and Wall Street, all they are concerned about is the size of the EPS and what's happening with the stock price. It's a situation that looks unsustainable. The question is how long can it last?