Search Results for: stress tests

Stress Tests, Lending, and Capital Requirements

By James Kwak Despite the much-publicized black eye to Citigroup’s management, the bottom line of the Federal Reserve’s stress tests is that every other large U.S. bank will be allowed to pay out more cash to its shareholders, either as increased dividends or stock buybacks. And pay out more cash they will: at least $22 … Continue reading Stress Tests, Lending, and Capital Requirements

Is Everyone Confused Yet? (Bank Stress Tests)

The public relations campaign packaging the bank stress tests is kicking into high gear and our professional information managers are really hitting their stride.  They face, of course, a classic spin problem: you need to get the information out there, but you don’t want to be too definitive on the first day or soon after – if … Continue reading Is Everyone Confused Yet? (Bank Stress Tests)

An Early Stress Test For The Financial Stability Oversight Council

By Simon Johnson How much damage to the financial system should we expect from what is now commonly called the foreclosure morass, the still-developing scandal involving document robo-signing (and robo-dockets), completely messed up mortgage paperwork and high-profile inquiries into accusations of systematic and deliberate misbehavior by banks? The damage to banks’ reputation is immeasurable. They … Continue reading An Early Stress Test For The Financial Stability Oversight Council

All About Optics (Predicting Stress Test Outcomes)

The bank stress tests are beginning to create a perception problem, but not – as you might think – for banks.  Rather the issue is top level Administration officials’ own optics (spin jargon for how we think about our rulers). At one level, the government’s approach to banks – delay doing anything until the economy … Continue reading All About Optics (Predicting Stress Test Outcomes)

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We have written a lot, both together and individually. This is an incomplete list, since it’s hard to keep this page updated. Books by Simon and James: 13 Bankers (Pantheon, 2010) White House Burning (Pantheon, 2012) Books by Simon: Jump-Starting America (with Jonathan Gruber) (PublicAffairs, 2019) Books by James: Economism (Pantheon, 2017) Take Back Our Party (Strong … Continue reading Read More

JP Morgan Debacle Reveals Fatal Flaw In Federal Reserve Thinking

By Simon Johnson Experienced Wall Street executives and traders concede, in private, that Bank of America is not well run and that Citigroup has long been a recipe for disaster.  But they always insist that attempts to re-regulate Wall Street are misguided because risk-management has become more sophisticated – everyone, in this view, has become … Continue reading JP Morgan Debacle Reveals Fatal Flaw In Federal Reserve Thinking