Abigail with attitude: Stress tests worthy of derision, not discussion
Last July, we had a round of very unstressful stress tests for the European banks. A mere seven banks failed and were ordered to raise an additional €3 billion of capital. We are living in a completely Kafkaesque world where most people apart from me seem to be high on drugs. I have seen no widespread derision surrounding the fact that, a mere 12 months later, the European authorities have had to conduct another round of stress tests. And as CNBC talking heads drone on about the likelihood of Greece, Ireland and Portugal defaulting, these tests insisted that only government bonds held on trading books be marked to market (as opposed to those being held to maturity).
In late July, European big-wigs gathered in Brussels for another emergency session. They were urged to find a bold solution. They simply produced another inadequate box of Band-Aids. I wonder what Egan makes of the latest news.