Well, howdy there, Internet people, it's Bell again.

So today, we're going to talk about U.S. and European banks, wargaming a collapse.

Central Bank and Treasury officials, along with private sector bankers from the EU, UK, and US, took part in a war game of sorts

in Washington. The scenario being planned out and stress tested for is the collapse of a

systemically important bank. The idea is to take a look at something similar to a Lehman Brothers collapse.

The FDIC, which is participating, said in a statement, quote,

These exercises enhance understanding of each jurisdiction's resolution regime for global systemically

important banks, strengthen coordination

on cross-border resolution, and promote confidence in and commitment to the orderly resolution

of GSIBs.

These little war games are known as a trilateral principle level exercise.

Not only do they help plan for global economic system failures,

it allows the people involved to see each other face to face

and develop relationships and trust prior to a major economic crisis.

Internationally, a lot of the mitigation efforts are organized quickly over the phone and rely on

quick agreements. The officials started their week in D.C. with a series of international

monetary fund and World Bank

meetings before staying over for the financial stress test exercise. Now, before this turns to a

total doom and gloom, it's worth knowing that these kinds of exercises have been taking place for years behind the scenes.

This one is just catching a little more news coverage because there's a lot of risk factors at the moment.

The current state of the economy, the amount of uncertainty introduced by you know who's constant chicken and waffles,

the global energy shock, and so on, is at the front of a lot of people's minds.

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