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"Jamming Your Own Signal"

By Ethan Brown

Apologies for the long silence but I've been taking in all the confusing and confusing, bad-news-is-good-news framing of the leaks regarding the results of the stress tests.

Bank of America, Wells Fargo and GMAC LLC all need need more capital.

MetLife, however, does not need more capital.[More...]

Turns out I'm not the only who is confused about what we're supposed to conclude about the health of the banking system from the stress tests. Over at Baseline Scenario, Simon Johnson writes that regulators are "jamming" their signal on the stress tests in order to achieve the precarious balance of not seeming "too easy on the banks" which "looks bad" while at the same time not being "tough on the banks" which "might be dangerous."

"Is everyone confused yet?" Johnson asks. The answer is undoubtedly "yes" and that is certainly the intention of the regulators.

Full post as published by TalkLeft on May 06, 2009 (boomark / email).