Federal Reserve Passes Big Banks in Stress Test: http://fortune.com/2016/06/23/fed-stress-test-banks/
The talking parrots are told what to say and when to say it. The timing of this "good news" is amazing isn't it?
What is really interesting is the same author in 2013 happen to bring up a point about the obvious elephant in the room, namely the all banks derivatives exposure.
The Fed's stress test may not be stressful enough
http://fortune.com/2013/03/07/the-feds- ... ul-enough/
Now all that concern has somehow disappeared! It's magic boys and girls....
I'll be the first to say I don't understand it all. But from what I have read U.S. rules allow banks to net out the derivative bets they make with each other, essentially erasing them from their financial statements. European rules however generally rely on total potential losses or gains while the Fed’s stress tests are essentially based on the more lenient U.S. accounting rules. Ah, isn't that sweet of the Fed to do!
So, how big is this exposure?
If you go to this report and look at Table 2:
http://www.occ.gov/topics/capital-marke ... /dq415.pdf
You will find a list of the top holding companies aka "Banks"
Their Combined Total Assets: $13,837,303 ($13.8 Trillion)
Total Exposure To Derivatives $236,591,597 ($236.5 Trillion)
I wonder if anybody else might see a tiny little problem with this picture?
Can anyone say...Pop goes the weasel!
