– Fed Orders Banks To Create ‘Super Secret, Entirely Useless’ Plan To Avoid Blowing Each Other Up (ZeroHedge, Aug 9, 2012):
Just when you had got over the entirely inane creation of a living-will that purports to solve the taxpayer’s dilemma should a large SIFI hit an iceberg; Reuters reports – this time super secret – the Fed, in 2010, asked for a plan from the US’ Big 5 Banks for staving off collapse if they faced serious problems – critically emphasizing that the banks can’t rely on government help. Read that again and we dare you not to laugh. It seems regulators are trying hard to ensure banks have plans for worst-case scenarios – in order to act rationally in times of distress.
– Exclusive: U.S. banks told to make plans for preventing collapse (Reuters, Aug 10, 2012):
U.S. regulators directed five of the country’s biggest banks, including Bank of America Corp and Goldman Sachs Group Inc, to develop plans for staving off collapse if they faced serious problems, emphasizing that the banks could not count on government help.
The two-year-old program, which has been largely secret until now, is in addition to the “living wills” the banks crafted to help regulators dismantle them if they actually do fail. It shows how hard regulators are working to ensure that banks have plans for worst-case scenarios and can act rationally in times of distress.
ROFL!