There is a New plan by the Federal Reserve for them to test banksâ€™ ability to survive.
They have a stress test criteria and they will be releasing the full results
Thursday afternoon at 4:30 ET. This is a worst scenario test.
looking at how the nation's 19 largest banks possibilly survive a world of
jobless rates over 12% and stock prices dropping 50% , with a 20+% home prices
usually conduct this test on banks every year, but have not been been releasing
the results of their worthiness since 2009 when they found billions of
insufficient funds on the banks balance sheets. They are suppose to have enough
cash and securities to withstand a catastrophic loss in a financial crisis. I
am sure they kept us in the dark because they didnâ€™t want to scare us anymore
than we already are. They are releasing this information for the first time in
4 years.Â These tests are designed to
detect their ability to survive. The Fed can stop banks from paying stock
dividends or buying back their own stock if they fail the test.
The Fed wants
banks to be strong enough to keep lending money to Americans and businesses.
Lets hope that they are strong, can pay back all of the money WE loaned them
with interest, and stand alone again