"Plunge protection teams", "stress tests", "liquidity phone calls", wash, rinse, repeat.
Cross fingers and hope like crazy folks believe you when you say !!! EVERYTHING IS AWESOME !!! The greatest way to build confidence in your global banking system, like ever? https://www.zerohedge.com/news/2019-06-21/all-banks-pass-fed-stress-test-would-lose-410-billion All Banks Pass Fed Stress Test... Would Lose $410 Billion Having been told numerous times that banks "are in far better condition now than before the crisis," we should not be at all surprised that all major banks passed The Fed's "adverse scenario" stress test. As The FT reports, US banks would lose $410bn if there were another severe global recession, but would maintain enough capital to keep lending to companies and individuals, according to US regulators. Eighteen of the country’s largest banks all passed the first round of their annual stress tests on Friday, as Federal Reserve figures showed the US financial services industry is well-enough capitalised to weather a worst-case scenario economic downturn. Wondering how terrifying the adverse scenario is... well it is certainly a big drop BUT expectations that it will all be forgotten in a couple of years seems a little ambitious if we ever see these kind of collapses again... Randal Quarles, the vice-chairman of the Fed in charge of banking oversight, said on Friday: “The results confirm that our financial system remains resilient. The nation’s largest banks are significantly stronger than before the crisis and would be well-positioned to support the economy even after a severe shock.” So why did The Fed abandon its normalization of the balance sheet? As Bloomberg reports, results posted so far show banks are getting better at coping with what’s become one of the most rigorous supervisory efforts: They maintained a collective common equity Tier 1 ratio that was double the regulatory minimum even at the depths of the theoretical recession. Lenders have been building capital for years, and while this year’s exam was harsher on credit-card loans, trading losses were down from last year at four of the five biggest Wall Street firms. Goldman Sachs and Morgan Stanley improved on last year’s poor results in the first round of the latest Federal Reserve stress tests, a sign they may have more flexibility to boost payouts to shareholders. ... [As long as interest rates stay at or literally below zero, tha banks cin cash up to the hills and thus be "strong in their ability to support the economy" - no real surprise when you can literally print as much money as you could ever want - so why bother with interest for anyone at all? Oh right, control - that's right, normal sheeple must be under the thumb...]
