The European stress test. The calming voice of reason.
With any pronouncement from any government about the stability of the financial systems comes the fear of making things worse, so they bring with them their actual area of expertise: PR.
The European stress tests were said to be more stringent than their American counterparts. Everyone applauded and understood everything was fine, really. Next to the bank assets reported in the European test, there was reporting of Gross and Net Debt.
Debt net of collateral and hedges. A company with billions in Debt was able to do some "risk management", and they can omit reporting on some of the b's. They actually pushed this so much that they were not disclosing the government debt in their balance sheets. Debt disappears in the test report. Take it off. Let's call it Net Debt of everything we don't want to disclose.
I am starting to believe the rumor that we have come to the point where financial information is meaningless. Thank God for economists. No wonder most people trading are following charts. It is like everyone knows without knowing that there is no point in reading financial statements. It is better just to find some overall hyper generalized pattern. All these misstatements and advertisements get summed up at some moment in bars moving up and down. Simpler and more effective to follow primitive but certain technologies like star charts, bird's migrations, the moon cycle, and the calendar month than tracking currents, ocean temperature, or global warming.
Over 200 years ago, the Rothschild's knew which government had money and which one didn't. Nowadays, the day trader knows more than the banker.
