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Financial Stress Test Deja Vu

Tyler Durden's picture




 

With the Fed pumping $118 million per hour into excess (and fungible) reserves into the banking system, the market has once again front-run the exuberance expected from the CCAR (or bank stress tests). Sadly, just as we saw last year, the 'hope' priced into US financial stocks is absolutely not priced into US financial credit markets and the strange case of deja vu all over again that we saw in last year's stress test makes us wonder why all those professional investors aren't snapping up the 'cheap' debt of the banks - unless they are well aware of reality. Of course, as we noted last year, the combination of pure economic guesswork and financial analysis leaves belief in the Stress Tests a total 'act of faith' and it seems, once again, credit markets don't believe.

 

 

Charts: Bloomberg

 

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Wed, 03/06/2013 - 15:43 | 3305756 SheepDog-One
SheepDog-One's picture

These size 32 inch waist jeans can handle the stress of this 500 pound FED balance sheet ass quite easily! Just got to apply enough melted butter.

Thu, 03/07/2013 - 02:13 | 3307879 Boris Alatovkrap
Boris Alatovkrap's picture

Boris is recommend axle grease and vodka for this job! (...Vodka is only for later when SHTF.)

Wed, 03/06/2013 - 15:45 | 3305757 SilverDoctors
SilverDoctors's picture

Jim Willie says fascism is seeing deja vu as well: The US has become Weimar Amerika, a fascist enclave.

http://www.silverdoctors.com/jim-willie-raging-gold-bull-disputed-propag...

 

Thu, 03/07/2013 - 02:14 | 3307882 Boris Alatovkrap
Boris Alatovkrap's picture

Fascism, Communism, same is the different.

Wed, 03/06/2013 - 15:45 | 3305759 madcows
madcows's picture

It's not a true stress test; it's a propaganda effort. "If we can just convince the public that everything is ok, then everything will become ok." 

No, Mr. Bernanke, public perception is not what is needed to fix the ailing economy; economic and governmental integrity is needed.  Until you, the banks and the government behave morally, no problems will be fixed.

Wed, 03/06/2013 - 15:43 | 3305760 El Hosel
El Hosel's picture

As long as you don't have to be smarter than a fifth grader to pass the test the Financials should have a great day tomorrow.

Wed, 03/06/2013 - 16:19 | 3305917 TheFourthStooge-ing
TheFourthStooge-ing's picture

The test taker is essentially Simple Jack. The test won't be passed, but not wanting to hurt anyone's feelings, the announced results will show great success.

http://www.youtube.com/watch?v=U-n_zk7e0ZU

Wed, 03/06/2013 - 15:49 | 3305779 fonzannoon
fonzannoon's picture

what happened to the whole money market breaking the buck avalanche stuff that was supposed to happen around now?

Wed, 03/06/2013 - 15:50 | 3305787 carefreemanjoe
carefreemanjoe's picture

Can someone challenge the beard of Oz to show some magic tricks like bringing down the market by 10 - 20 % and then making it rise again to new highs. That would be so cool! Well witjhin his possibility especially with the unlimited money printing.

Wed, 03/06/2013 - 15:50 | 3305788 carefreemanjoe
carefreemanjoe's picture

Can someone challenge the beard of Oz to show some magic tricks like bringing down the market by 10 - 20 % and then making it rise again to new highs. That would be so cool! Well witjhin his possibility especially with the unlimited money printing.

Wed, 03/06/2013 - 15:52 | 3305791 Shocker
Shocker's picture

Oh no stress tests are back?

Wed, 03/06/2013 - 15:52 | 3305793 thismarketisrigged
thismarketisrigged's picture

financials have shot up since this. its disgusting to watch.

 

its like we wipe out all our losses in 1 day, but we can never retract from gains, no matter how overbought this scam is.

 

dont worry, im sure the dow may fall -5 pts tomm, and the s&p may shed .50 pts off it. that will be the correction

Wed, 03/06/2013 - 15:52 | 3305794 Glass Seagull
Glass Seagull's picture

 

 

 

Is that an H&S on the HYG daily chart setting off an ending diagonal on the weekly chart?  Just checking.  HY credit about to walk into the wind.

Wed, 03/06/2013 - 16:10 | 3305874 Sach Mahoney
Sach Mahoney's picture

doh

Wed, 03/06/2013 - 16:18 | 3305910 carefreemanjoe
carefreemanjoe's picture

There is a possibility that Uncle Ben will push the levers and bring down the market by  2 - 3% to give the illusion of a healthy pull back and a healthy bull run.

Wed, 03/06/2013 - 16:18 | 3305911 carefreemanjoe
carefreemanjoe's picture

There is a possibility that Uncle Ben will push the levers and bring down the market by  2 - 3% to give the illusion of a healthy pull back and a healthy bull run.

Wed, 03/06/2013 - 16:32 | 3305960 Village Smithy
Village Smithy's picture

Maybe he has chosen a previous segment of the S&P from historical records (pre HFT) and is just duplicating it day by day so that it at least appears random. If we could find that segment then...

Wed, 03/06/2013 - 17:21 | 3306120 SheepDog-One
SheepDog-One's picture

'Bring down the 'market' by 2-3%'....so then we'll be all the way back to last weeks levels? 

The Horror....

Wed, 03/06/2013 - 16:35 | 3305964 Haager
Haager's picture

Would someone like to go out to tell the poor people that the great nation they're living in is spending 118 million bucks every single hour to keep up the shiny image of a prosperous country for the rich?

I'm still unsure about whats worse, the European austerity scam or the great QE theft, but I tend towards a comparision between heart failure or final stage brain tumor.

Wed, 03/06/2013 - 16:41 | 3306001 besnook
besnook's picture

the fact is the banks are getting healthier. bank of america is the main benefactor in the mbs fed buyback, along with fannie and freddie. as the world financial system is scraped clean of the dried, encrusted feces of the real estate bubble the banks will actually be able to lend against the reserves they have built up defending themselves from all the bad debt on their books.

the fed has projected they will buy a trillion dollars in worthless mbs at 100% on the money. if the banks lend against the new, clean money(they have to find soemone willing to borrow) inflation will not be able to hide once the multiplier returns to normal.

Wed, 03/06/2013 - 16:47 | 3306023 RougeUnderwriter
RougeUnderwriter's picture

Just another injection of Hopium. Take the happy pill and smile as Rome burns

Wed, 03/06/2013 - 17:08 | 3306081 Dre4dwolf
Dre4dwolf's picture

Yes, but this time we have the Federal Reserve buying up the Dow Index decreasing supply making the stocks sky-rocket.

The "fed" has unlimited credit and they intend to use it to make themselves rich at our expense.

So.

 

 

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