Mark Whitehouse, Columnist

U.S. Banks Just Enjoyed Another Stress-Free Stress Test

There’s a better way to ensure the financial system can weather a crisis.

June 21, 2019 at 9:08 PM UTC

Mark Whitehouse is a member of the editorial board covering global economics and finance. Previously, he reported on economics for the Wall Street Journal and was managing editor of Vedomosti, a Russian-language business daily.

That was easy.
Photographer: Carl Court/AFP/Getty Images

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The Federal Reserve’s stress tests are supposed to ensure that the U.S. financial system can survive a crisis, in part by requiring banks to build up loss-absorbing equity in good times so they’ll be ready when the bad times arrive.

Judging from the latest results, they’re not up to the task.