Big banks get ready for White House stress tests

“The outcome of the stress test is, how much capital does this bank need in order to meet the credit needs of borrowers in our economy’”

Critics worry the government’s rescue actions have the potential to put ever-more taxpayers’ dollars at risk and encourage “moral hazard,” where companies feel more comfortable making high-stakes gambles because the government will bail them out.

“All the greed and deceit has overtaken common sense in the decision-making process in the country.”

On the economic front, Bernanke told lawmakers that the economy was suffering through a “severe contraction.” But he planted a seed of hope that the recession might end this year if the government managed to prop up the shaky banking system.

“The outcome of the stress test is, how much capital does this bank need in order to meet the credit needs of borrowers in our economy’”

Critics worry the government’s rescue actions have the potential to put ever-more taxpayers’ dollars at risk and encourage “moral hazard,” where companies feel more comfortable making high-stakes gambles because the government will bail them out.

“All the greed and deceit has overtaken common sense in the decision-making process in the country.”

On the economic front, Bernanke told lawmakers that the economy was suffering through a “severe contraction.” But he planted a seed of hope that the recession might end this year if the government managed to prop up the shaky banking system.

Source: http://www.wtopnews.com/?nid=111&sid=577993