bank stress results - can this be true?

Discussion in 'Economics' started by oulisee, Apr 20, 2009.

  1. oulisee


  2. I believe this to be the 3rd thread on this subject...
  3. I read that blogpost - what a bunch of drivel!
  4. 16/19 banks are technically currently insolvent?

    Considering that the S&P 500 is down 32pts today (-3.8%), there may be some truth to the stress tests being quite discouraging. If the gov't officially issued that 16/19 banks were insolvent, that would be catastrophic.

    Let's see if this is not some manipulation ploy from the hedge fund world.

  5. Trust your GUT.

    We all KNOW these banks are insolvent. The problem is that they're on LIFE SUPPORT which costs trillions of taxpayer dollars but doesn't "cure" their "disease."

    I'm certain the official stress test results will be fudged, just like all gov't data (CPI, unemployment, etc).

    This could get very bad.
  6. Fudged like the statistics of China's entire economy? :p

    Or fudged by misrepresentation?

    BTW, George Soros claimed that the banks were insolvent = nationalization...

    Exaggeration of the stress tests could be some ingenious hedge fund ploy... Mkt has been rallying w/ many rumors about the horrible stress test results... rallying until today at least.
  7. This is a bunch of baloooooony lol. I don't think these banks would be in such dire straits. Each stock price reflects the banks ability to stay solvent. There is a reason most of those stocks are down over 90% year over year.

    As to goldman and morgan stanley having leveraged positions more than thier company worth, maybe they could be winning positions by now, or not as bad as people expect, or projections in profitablity have changed 3-5 years out. Again, there is a reason thier prices are where they are.

    I think the market has some of this bank stress-test doomsday already priced in the market. I think 8k dow relative to american economic history is cheap, but thats just me. Maybe the reason we are down today is because of bank uncertainty.