They Just Don't Get Stress Tests!

NEW YORK (TheStreet) -- When reporting on the good grade banks from J.P. Morgan ( JPM) to Bank of America ( BAC) to Wells Fargo ( WFC) received from the federal stress test, nearly all media outlets declared immediate victory and, when looking forward, sketched out a future full of nothing but dividends and buybacks.

Happy days, as far as the eye can see.

To The Wall Street Journal, for example, the stress test was nothing short of a "milestone." It looked back--to the first stress test and forward, but only to a future of flowers and chocolate in the form of those swelling dividends and buybacks.

But is that all the future holds for the banks?

Of course not, but the media hate to stand in the way of a parade. That's why TheStreet had such a welcome contribution with a story entitled: "Banks' Biggest Stress Test Remains." It looked forward, but to a more complicated, mixed and realistic future. The second sentence laid out the possible days ahead, which could trend further (and darker) than a grab bag of shareholder giveaways: "For bank giants, the prospect of bond ratings downgrades or a worsening of the European debt crisis is a still imminent threat, even after stress tests results added to a 2012 bank stock rally."

With apologies to most of the media, it might not be happy days as far as the eye can see.
At the time of publication, Fuchs had no positions in any of the stocks mentioned in this column.

Marek Fuchs was a stockbroker for Shearson Lehman Brothers and a money manager before becoming a journalist who wrote The New York Times' "County Lines" column for six years. He also did back-up beat coverage of The New York Knicks for the paper's Sports section for two seasons and covered other professional and collegiate sports. He has contributed frequently to many of the Times' other sections, including National, Metro, Escapes, Style, Real Estate, Arts & Leisure, Travel, Money & Business, Circuits and the Op-Ed Page.

For his "Business Press Maven" column on how business and finance are covered by the media, Fuchs was named best business journalist critic in the nation by the Talking Biz website at The University of North Carolina School of Journalism and Mass Communication. Fuchs is a frequent speaker on the business media, in venues ranging from National Public Radio to the annual conference of the Society of American Business Editors and Writers.

Fuchs appreciates your feedback; click here to send him an email.

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