School’s out, probably for the spring and summer, possibly forever. B-schools are trying (and failing) to justify their existence in absence of their real raison d’être, networking through the medium of alcohol. The SAT’s cancelled and Advanced Placement exams have been turned into online tests of how well students can cheat in 45 minutes. University exams have either been called off or turned into opportunities for academic dishonesty.
Given all of the above, and given what good boys and girls they’ve been, and despite their eagerness to totally crush the now very-easily-crushable Federal Reserve stress tests, America’s biggest banks are wondering if they can’t just get practical credit for this year’s exams.
The annual stress tests for the biggest banks, due April 6, are meant to gauge if banks would survive a hypothetical recession that sends the stock market plunging, oil into a tailspin, loan defaults rising and unemployment to society-shattering highs…. Some economists are predicting that the current downturn could be sharper and reach farther than the worst-case scenario on this year’s test, which the Fed refers to as “severely adverse….”
The Fed on Tuesday said it would relax some examination work, particularly at smaller banks, but that big banks should still submit their plans….
Bankers are telling the Fed the results, typically released in June, will be irrelevant given how rapidly coronavirus has slammed the brakes on the economy and the unknown impact that will have on everything from consumer spending to bank balance sheets…. Some in the industry are questioning whether the Fed should cancel or delay the test, or hold off on capital-plan approvals, the people said.