• Bank Stress Tests Less Stressful than Anticipated

  Filed under Banks, Economy, Finances, Politics
  May 4

  We’re seeing new components of President Obama’s economy rescue plan put into place daily. One of these, a stress test on the Nation’s largest 19 banks, was recently conducted. The results were supposed to be published today but for whatever reason will now be fully disclosed this Thursday afternoon. Officials conducting the test have given some sneak peeks at the results but are waiting until Thursday for the full disclosure. 

  These officials have reported a surprisingly optimistic outcome from these tests. While the Nation still has a long road ahead to recovery, according to a New York Times article, the losses are “manageable.” The purpose of the test was to determine whether these top few banks would need significantly larger amounts of capital to handle the economic recession. The results of the test will expose each bank’s currrent situation, in order to aid investors in deciding which entity they will trust with their money.

  One goal of the stress test was to boost public confidence in the banks and thus raise stock prices. These effects have been witnessed so far in a few of the Nation’s leading banks-Wells Fargo, Citigroup, Bank of America and JP Morgan. Will this optimism last? The Obama Administration sure hopes so. If not, the new President may have to ask congress for billions more dollars in order to help out these struggling banks. So I guess all we can do is wait with bated breath until Thursday rolls around and the results of the test are shared. Let’s hope public opinion is affected enough to boost stock prices and begin aiding our struggling economy.

  Tagged as: Economy, personal finance
  
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