by Colin Lovett, PICurrent Managing Producer
Just like a trip to the doctor for a sick heart patient, our major banks have gone through a stress test that has revealed problems. But the news from the Obama administration is mixed because while many of the banks need to raise more money, the news is not as bad as many had feared.
Of course, the bank CEO’s were not forced to run on a treadmill until they dropped, although that would have been fun to watch. What the government did was take a close look at the bank’s balance sheets and then make projections of what would happen to them if a few bad things happen in the economy.
The results: 10 of the nation’s largest banks need to raise $75 billion more in cash. That’s the bad news. The good news is that this is less than was expected and almost half of the banks need no new cash at all.
If the banks are healthier, it may be a sign that the credit crisis could be easing. (For more, visit the New York Times or the Washington Post). If the banks are healthier, it could be easier for individuals and businesses to get loans, which have been harder to get in recent months.
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[...] $45 billion in bad debt for 2008, and forecasters expect this number to keep growing. The recent bank stress test, a possible worst case scenario for the economy, suggests the nation’s biggest banks may see [...]