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Monday, April 20, 2009

Stress Test: What game will government play?

Government is going to release the results of bank stress test on May 4th. What kind of test results can government afford to release? Government can't fail any bank in the report; otherwise, it will cause bank-run or sink the stock of the failed bank.

What government will do is to make the report look as ambiguous as possible: let everybody pass but identify who is A student and who is D student.

Watch this discussion from Yahoo Techticker: