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Fed Governor Is Sick Of Proctoring Stress Tests

He's pretty sure the vast majority of them are pointless.
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So he’d like there to be fewer of them.

While the Fed subjects a handful of the biggest banks to more severe hypothetical shocks under the stress test, he said even the basic exercise places a very large and expensive burden on the smaller participants. At the same time, the Fed isn’t really getting that much benefit out of running those smaller participants through the test, he said. “Those benefits are relatively modest, and we believe we could probably realize them through other supervisory means,” Mr. Tarullo said.

Fed’s Tarullo Reiterates Support for Raising “Systematically Important” Threshold [WSJ]



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