Bank Strength Indication

                  

I mentioned in a previous blog the Dodd-Frank Act of 2010, which was supposed to make banks stronger, among its other panacea provisions, and banking credit-rating downgrades.

                       

There is yet another way to measure the fact that big banks are not deemed as secure by investors as they were before the Dodd-Frank Act. Look at the cost of insuring bank debt.

                                           

The cost of insuring $10 million of debt for five years is an excellent indicator that’s available with regard to the credit standing of major banks. And it’s been high, at least as an investors’ perception of that

risk. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)