Tuesday, April 21, 2009

Stress Test: Insolvent Banks?

On April 19, a blogger claimed to have a copy of the U.S. Treasury's 'Stress Tests' of 19 large banks, and apparently this report said that 16 of the 19 are insolvent.

Then, the same blogger claimed to have received a telephone call from the Securities & Exchange Department about the report.

On April 20, the Treasury Department issued a statement saying that the results of the 'Stress Tests' hadnt been received yet.

But on April 10, the Treasury Department warned the banks not to release the results of the 'Stress Tests' before the end of the earnings season, when banks report their quarterly earnings/profits/losses.

Today, just after the stock market closed, the Associated Press claimed to have received an advance report of the Treasury's 'Stress Test' results.

Combine that with this explanation of the accounting irregularities reported by the banks this earnings season, and you can see how the banks' stock prices could be artificially inflated by accounting gimmicks. This is significant because the stock market's rally during the past 4 weeks has been fueled by the large banks reporting unexpected quarterly 'profits'.

Cold Fusion

Here's a 60 Minutes story on cold fusion. It's a good story.


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