Friday, July 23, 2010

Stressed? Maybe

I somehow don't think it was a coincidence that the much awaited banking stress tests result of 91 European Banks was set up for 18.30 on a Friday afternoon.

They must have been terrified the markets would get frit. As it was the Euro dropped severely during the day as rumpours (particularly about Spain) fed into the trading floors.

During the day the Euro rallied, but was last seen in a downward direction.
Euro falls as credibility of stress tests questioned
However the Euro spin meisters of Frankfurt now have the weekend to big up their figures
'The results of the test confirm the overall resilience of the EU banking system to negative macroeconomic and financial shocks, and are an important step forward in restoring market confidence,' the EC, ECB and the Committee of European Banking Supervisors (CEBS) indicated.
before the continents markets and most importantly London opens for business.

The problem is, is that the markets themselves do not seem to be convinced that the tests were authoratitive.
"Investors quickly deemed some of the tests' terms insufficiently onerous. As details of the test methodology trickled out Friday, the euro fell back from early gains to trade lower against the dollar. European bank stocks, strong during the week, retreated in New York trading."

1 comment:

Anoneumouse said...

The truth concept, which consisted in telling the truth and replacing lies by a single text called "a stress test", is abandoned.

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