So it turns out that Treasury was lying about not having stress test results.

[girl gone mad]

From http://zerohedge.blogspot.com">Zero Hedge:

After all the brewhaha yesterday by the Treasury that they had nowhere, nohow released Stress test results, the http://finance.yahoo.com/news/APNewsBreak-Fed-tests-harder-apf-14987065.html?sec=topStories&pos=main&asset=&ccode=">Associate Press (a little more credibility than an alleged white supremacist) has just come out with an exclusive that claims it has seen a Federal Reserve document discussing the stress test implications - yes, http://market-ticker.denninger.net/archives/972-Treasury-Caught-Lying-Again.html">Denninger was right, and the Treasury was lying. This seem to lend much more credibility to Hal Turner's disclosure from yesterday.

According to AP, the stress tests "take a harsher view of loans than of other troubled assets. That approach favors a few Wall Street banks while potentially threatening major regional players."

The regulators' focus could spell trouble for big regional banks undergoing the tests. Their portfolios have more individual loans and fewer of the big pools of securitized loans that Wall Street giants specialize in.

Some analysts said regulators are favoring the largest banks because if even one failed that would pose a severe economic risk. Banks that deal in securities are more interconnected to other corners of the global financial system.

Regulators also face pressure to highlight the weaknesses of some banks, or critics will dismiss the tests as a whitewash. That would undermine the goal of improving confidence in the financial system.

Under one scenario, the test assumes banks will see "no further losses" on these complex securities at the heart of the credit crisis. By contrast, it estimates that the banks' individual loans will lose up to 20 percent of their value.

The methodology "certainly penalizes those banks that are more involved in traditional banking, which frankly have been performing better in recent months," said Wayne Abernathy, a former Treasury Department official now with the American Bankers Association.

He said banks' loan portfolios have lost only about 5 percent of their value so far, whereas the value of complex securities are down 30 to 40 percent.

The soap opera continues. At this point there is really nothing else to say.

[FrenchieCat]

1. Actually, that is a wrong assessment.....

the Associate Press has no more credibility than an alleged white supremacist.

Those who have followed the biased reporting actually know this well.

[truedelphi]

3. Associated Press will say or do whatever its masters ask of it.

And if the Truth is smeared Big Time, so much the better.

So for once, lately, we agree!

[FrenchieCat]

4. I think you will find that as time goes on, we will agree much more

than what we disagree on!

[truedelphi]

9. Here's one thing we probably agree on -

It's a lot easier to laugh and to smile at things now that the evil Bushies and Cheney people are gone. Since President Obama has taken over, I do feel lighter and more like I am coming from my heart. Tell me a joke and I get it. Before November 4th,. I had gotten to the point that nothing was amusing or fun any more.

I am so glad those people are gone.

[girl gone mad]

10. On that, we can all agree! n/t

[girl gone mad]

5. Sadly, the AP has more credibility than the Treasury dept..

these days.

[FrenchieCat]

6. Only to the cynics.

There are not as many as one would want to think.....actually.

In fact, Cynics, as my sig points out, are simply impatient folks who like to
analysis shit to death, oftentime without giving a fair chance.

[notesdev]

8. Cynics? Or realists?

The Treasury announced a program today to fund the elimination of the word "gullible" from the dictionary. Shares of Miriam-Webster jumped on the news!

[truedelphi]

12. Sorry, Frenchie Cat, but I spent some 4 yrs of my life on the MTBE issue

And here is my full report on how the Associated Press works. (MTBE being the gas additive that was mandated for vehicle use in California)
I made the report on the Lack of Truth in the AP both a KOS entry and a DU journal entry.

THe KOS entry is the full report - the truncated version is in my journal.

http://www.dailykos.com/story/2008/6/22/143038/082?new=true


journals.democraticunderground.com/truedelphi/62

When the Powers that Be (That is, the oil, banking and Big pharma interests) did not like the Blue Ribbon Panel report on MTBE,the instructions were given to simply skew the newspaper articles.

The truth is quite unimportant in an Oligarchy. Inside the Oligarchy,only the Corporate Interests matter.

[notesdev]

7. And now so does Hal Turner!

that's when you know it's gotten REALLY bad.

The wheels have come off the rails, and the Treasury/Fed/Wall Street freight train is headed off the bridge.

Unfortunately, they are carrying a cargo full of our money down the chasm with them.

[dixiegrrrrl]

2. I always feel more confident when my government lies to me, don't you?

Actually, by now, I just assume anything my government tells me is a lie, until I find out otherwise.

[wuvuj]

11. A REAL stress test?

Click the link for a chart....you can easily see why Goldmans fronts Geithner and Summers?

...

http://www.moneyandmarkets.com/big-bank-profits-are-bogus-massive-public-deception-33228

...


Big bank profits are bogus! Massive public deception!

Martin D. Weiss, Ph.D.


A big bank CEO on a mission to deceive the public doesn’t have to tell outright lies. He can con people just as easily by using “perfectly legal” tricks, shams, and accounting ruses.

First, I’ll give you the big-picture facts. Then, I’ll show you how big U.S. banks are painting lipstick on some of the fattest pigs ever raised.

Six of America’s Largest Banks at Risk of Failure

As we have written here so often … as we documented in our recent white paper … as we showed in our presentation to the National Press Club … and as we explained again with new data in our follow-up press conference, the nation’s banking troubles are many times more severe than the authorities are admitting.

First, look at the megabanks: The authorities SAY that all of the 14 largest banks have earned a “passing” grade in their just-completed “stress tests.” But just six months ago, the authorities swore that, without a massive injection of taxpayer funds, those same banks would suffer a fatal meltdown.

Was the bad-debt disease magically cured? Did the economy miraculously turn around? Not quite. In fact, we have overwhelming evidence that the condition of the nation’s banks has deteriorated massively since then.

How can our trusted authorities be so blatantly deceptive and still keep their jobs? Perhaps you should ask Fed Chairman Ben Bernanke. Not long ago, for example, he declared that the total losses from the debt crisis would not exceed $100 billion, while conveying the hope that most of those losses could be soon written off. Also around that time, the International Monetary Fund (IMF) estimated the losses would be $1 trillion, with only a small percentage written off.

The IMF’s latest estimate: $4 trillion in losses, with only one-third of those written off so far. Bernanke’s error factor: He was 4,000 percent off the mark, in a world where 50 percent errors can be lethal.

Meanwhile, based on fourth quarter Fed data, we find that, among the nation’s megabanks, six are at risk of failure in our opinion (seven if you count Wachovia and Wells Fargo as separate institutions).

* JPMorgan Chase is the nation’s largest, with $1.7 trillion in assets in its primary banking unit. It’s massively exposed to defaults by its trading partners in derivatives — to the tune of 382 percent (almost four times) its risk-based capital. Plus, since it holds HALF of ALL the derivatives in the U.S. banking industry, JPMorgan is at ground zero in the debt crisis.

* Citibank is the nation’s third largest, with assets of $1.2 trillion in its main banking unit. Its total credit exposure to derivatives is a bit lower than Morgan’s, at 278 percent, but still extremely high. Plus, it has other troubles, especially the surging default rates in its sprawling global portfolio of credit cards and other consumer loans. (More on these in a moment.)

* Wells Fargo and Wachovia now make up the nation’s fourth largest bank with combined assets of $1.17 trillion. But in the fourth quarter, they still reported separately, which is illuminating: Even without Wachovia’s troubled assets, TheStreet.com Ratings has downgraded Wells Fargo to a D+. Wachovia, meanwhile, got a D. This tells you that Wells Fargo wasn’t exactly the best merger partner, unless you believe in some bizarre math wherein adding two negatives somehow gives you a positive result.

* SunTrust, with $185 billion in assets, is getting hit hard by the collapse in the commercial real estate. Its Financial Strength Rating is D+.

* HSBC Bank USA has massive credit exposure to derivatives that’s even greater than Morgan’s: 550 percent of risk-based capital. We’re not looking at its larger foreign operations. But the U.S. numbers are ugly enough, meriting a rating of D+.

* Goldman Sachs, which reported for the first time as a commercial bank in the fourth quarter, seems to be taking the biggest risks of all in derivatives. Its total credit exposure is 1,056 percent of capital. Bottom line: It debuts as a bank with a rating of D, on par with Wachovia.

Regional banks: Banking regulators have been largely mute regarding major regional banks. But several are also at risk of failure, including Compass Bank (Alabama), Fifth Third (Michigan), Huntington (Ohio), and E*Trade Bank (Virginia). Primary reason: Massive losses in commercial real estate loans.

Smaller banks: On its “Problem List,” the FDIC reports only 252 institutions with assets of $159 billion. In contrast, our list of at-risk institutions includes 1,816 banks and thrifts with $4.67 trillion in assets. That’s seven times the number of institutions and 29 times more assets at risk than the FDIC admits.

more....