Treasury Secretary Tim Geithner is the happiest guy in the world today. He's gone from tax cheating incompetent to boy wonder financial genius whose stress tests have restored order to the global financial system.
By one measure, the stress tests have met their goal: they have restored investor confidence. Led by the very banks that got us into this mess, the stock market has forged ahead, rising by over 33 percent since the March lows. Of course 30 percent seems positively paltry, when compared to Bank of America' s gain of 128 percent since the stress tests were announced on February 10.
There will be hoots and hollers that the stress test process was a carefully managed PR event and probably not a true rigorous measurement of banks' health. Maybe so, but at least the government finally stepped up and did what it should have been doing all along: getting to the bottom of the banks' balance sheets (Oh, that!)
It may be that Geithner & Co. benefited from a little bit of luck. The economic data has improved during the stress test period, which may have removed Geithner from the hot seat.
Mark, a hedge fund manager in Washington D.C., sent along another bit of interesting info regarding our Treasury Secretary: He was separated at birth! See Geithner here and then check out his long-lost twin (who you may recall from The Flintstones).