2013 Stress Test

2013 Hunger Games  Stress Test

After looking at the additional requirements that the United States Federal Reserve is requiring of some of the country’s 30 largest banks and financial services companies for their annual stress test, it does not look to good for some of these institutions, this year the test is suppose to be harder.  The new questions concern their exposure to Asia, and what could these institutions look like if something bad were to happen to the Asian economies (really it China, but we do not want to so direct).

The Federal Reserve announced that it will conduct some of the test on own on the 19 largest, but that is really a falsehood, in that they will really only perform the tests themselves on the top eight, the other 11 of this group will test themselves and submit the result to the Federal Reserve.  Maybe there is a question as to the rigor that some of the organizations applied to themselves in the last round of testing.

Those chosen for special consideration in order of Total Assets are (1) JP Morgan Chase & Co., (2) Bank of America Corp., (3) Citigroup Inc., (4) Wells Fargo & Co., (5) The Goldman Sachs Group Inc., (6) MetLife, Inc., (7) Morgan Stanley, and (8) US Bancorp.

The rest of the 19 financial institution in order of Total Assets are, (9) Bank of New York Mellon Corp., (11) Capital One Financial, (12) The PNC Financial Services Group Inc., (14) State Street Corp., (15) Ally Financial Inc., (16) BB&T Corp, (17) SunTrust Banks,  (19) American Express Company, (22) Regions Financial Corp., (24) Fifth Third Bancorp, and (29) Keycorp.

Rounding out the collection of the top 30 banks and financial institutions that are subject to this annual testing again in order of Total Assets are,  (10) HSBC North America Holdings Inc., (21) RBS Citizens Financial Group, AKA Citizens Financial Group, (26) BMO Financial Corp., (27) Northern Trust Corp., (28) UnionBanCal Corp., (31) M&T Bank Corp., (33) Discover Financial Services, (35) BBVA USA Bancshares Inc., (36) Comerica Inc., (37) Huntington Bancshares Inc., and (38) Zions Bancorporation.

The Federal Reserve has this nice little web site that displays the ranking of the top 50 Holding Companies in the United States.

 http://www.ffiec.gov/nicpubweb/nicweb/Top50Form.aspx

For those who are interested in the particular of the skull numbing tests I direct you to the following link.

http://www.federalreserve.gov/newsevents/press/bcreg/20121115a.htm

Enjoy they are the attachments at the bottom of the page.  It only took about 10 minutes for my skull to lose feeling.

Release the Kraken (Where is Liam Nesson when you really need him, Ben Bernanke just does not have the voice to pull this off), and to all thirty of the participant in the 2013 Hunger Games Stress Test  “Happy Hunger Games Stress Test! And may the odds be ever in your favor!”  Let the games begin.

WTFAH

Could someone please explain to me how a 153.6 Million Dollars fine to JP Morgan Chase & C., whose reported Net Income for 2010 was 17,370. Million Dollars actually punishes the company?  The Material impact on their bottom line is less than 1 percent of 2010 net income.

What kind of “Hard Working” lawyers does the SEC have on their staff?  My best guess is lawyers that want to work for JP Morgan, when they get tired of the their current gig, and have built up enough brownie points to get hired by JP Morgan.

Other than a promise that JP Morgan Chase & Co. will cross their heart (If they actually have one) (Wait corporations don’t have hearts, yet they are afforded rights as if they were human), never ever do this again. What assurances do we really have that they will not turn around and do it again?

I know it is the ever-vigilant and timely United States Security Exchange Commission.  You know the groups whose motto is “Vel caecus interdum can reperio a lamnia lammina lamna”,  (Even the Blind sometimes can find a coin).  This is the government agency with something like 3700 full time employee, whose budget in 2010 was 1,571 Million Dollars.  Note that the SEC budget does not exceed the 10 percent of JP Morgan Chase & Co. Net Income for 2010.  JP Morgan Chase and Co. employees alone outnumber the SEC employees 65 to 1.  Add in Citicorp, Bank of America, …etc., well you get the picture.  The SEC is like 7^th Calvary at the battle of Grease Grass (Little Bighorn), where the famous refrain of the day was “Where did all the dam Indian come from”.

Oh, and all of these games took place in 2007, let see it 2011.  Three and half years to find the incident, and to come to some type of agreement on the subject where the pertpatrator did not admit any guilt or wrong doing, but just handed over a small token to get the morons out of their offices, not bad for a government agency who as far as I can tell main function is lip service.

JP Morgan Chase & Co. is only one of the companies that this commission is chartered to provide over site on.  What kind of job are they really doing?  I am sure that most of the employee’s are well past trying to drain the swamp, past trying to killing all of the Alligators, past the point of even trying to kill just one small Alligator, and more in the mode of just trying not to get eaten by the Alligators.

When dealing with any institution that is regulated by the SEC, a word to the wise “Caveat emptor”.  Remember the 15 Qualified Investors who were really outside of the sphere of the normal JP Morgan Chase & Co. clients, (Most of those clients told them to go away on the Squared CDO), that bought the crap from JP Morgan Chase and Co. called “Squared CDO”.