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Thursday, 23 June 2016

Banks' Stress-Tests Are A Joke - "The Name's Tucker, Not SUCKER"

The 33 Biggest Banks Beat the Fed's Stress-Test Minimums for 2nd Straight Year

For the second straight year, the biggest U.S. banks all had sufficient capital to withstand a severe financial downturn, according to results of the Federal Reserve's annual stress tests. 
It was a close call for some, including Morgan Stanley (MS) , BMO Financial (BMO) , Huntington Bancshares (HBAN) and KeyCorp (KEYThe tests are the first phase of the review and will be followed by scrutiny of how the companies' plans for dividends and stock buybacks would affect their balance sheets. 
The Fed's annual tests are designed to ensure banks with more than $50 billion in assets have sufficient buffers to survive a crisis similar to the 2008 economic meltdown. This year's review used economic modeling to predict how the companies would fare in three different scenarios, the worst of which was a hypothetical "deep and prolonged" recession with peak unemployment of 10% in the middle of 2017 and stocks losing half their value by the end of 2016.
Banks considered this year's test one of the harshest in recent years, partly because the hypothetical increase in the unemployment rate -- more than doubling the current level -- is much greater than in previous years.
In the 2015 test, the unemployment rate only increased by 4 percentage points through the middle of 2016. This year's review also raised the prospect of negative interest rates, which may be tougher on banks without major trading operations, for the first time.

Pound and FTSE 100 rally as City expects remain vote  
The mood was echoed on stock markets, where the FTSE 100 index hit a two-month high. The index of leading shares was up 1.5% at 6357 in mid-morning trading, buoyed by mining shares as copper prices rose. There were also gains for other bourses around Europe with Germany and France’s main share indices up almost 2%.

"We're going to be there," Mabus said of the Black Sea. "We're going to deter. That's the main reason we're there -- to deter potential aggression." Mabus spoke days after Russia criticized NATO discussions about a creating a permanent force in the Black Sea. The NATO summit is set to tale place as relations between Russia and the alliance are severely strained over Moscow's role in the Ukraine crisis and in Syria. While Russia says it poses no threat to alliance, NATO is considering what to do to counter what it sees as growing Russian aggression.

With 5 percent of the world’s population and 25 percent of the world’s prison population, the United States has the largest incarcerated population in the world. No other society in history has imprisoned more of its own citizens. There are half a million more prisoners in the U.S. than in China, which has five times our population. Approximately 1 in 100 adults in America were incarcerated in 2014. Out of an adult population of 245 million that year, there were 2.4 million people in prison, jail or some form of detention center. 

Shell’s Ambitious Plan To Topple Exxon     

Shell Rig Ben Van Beurden, Chief Executive Officer of Royal Dutch Shell has laid out an ambitious plan to overtake ExxonMobil as the number one oil company in the world. Prior to the 1990s, Shell was the leader in total shareholder returns, however, its rivals went on a deal-making spree to gain the lead, while Shell shied away from making any acquisitions. Now, Mr. Beurden believes that Shell will be able to regain its lost glory post the acquisition of the BG group. “I am determined to get us to that number one place,” Mr. Beurden said after outlining the company’s long-term strategy in London. “I want to create a world class investment case for Shell and our shareholders,” reports Bloomberg . Shell, with a market capitalization of $216.6 billion , has a lot of catching up to do if it wants to surpass Exxon’s market capitalization of $379.5 […]

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