From Bloomberg, Mar 19, 2014, 11:54:55 AM
This week, the Federal Reserve will present the results of stress tests designed to ensure that the largest U.S. banks won’t turn the next financial crisis into an economic disaster. There’s just one problem: If the tests were realistic, most of the banks would fail.
King is trying to press banks to raise capital levels without prompting them to shrink lending http://bloom.bg/U4dhRe Must invest capital in loans with highest risk adjusted return . Basel3 and Dodd Frank constrain Derivative investment. US Banks will have competitive advantage in Derivatives until Basel3 is implemented.