Did Geithner rig bank ‘stress tests’?

It’s hard to argue otherwise on Treasury Secretary Tim Geithner’s “stress test” for bank solvency, outstanding loans are getting dinged harder than securities, such as the infamous collateralized debt swaps.

The methodology "certainly penalizes those banks that are more involved in traditional banking, which frankly have been performing better in recent months," said Wayne Abernathy, a former Treasury Department official now with the American Bankers Association.

He said banks' loan portfolios have lost only about 5 percent of their value so far, whereas the value of complex securities are down 30 to 40 percent.

A spokesman for the Federal Reserve would not comment. A Treasury Department spokesman referred questions to the Fed.

Meanwhile, even as evidence of fraud in TARP/TARP 2.0 piles up, with more than 20 criminal probes already launched by special investigator general Neil Barofsky into possible securities fraud, tax violations, insider trading and other crimes, little Timmy G. continues to tout his program.

Given that much of Congress, on both sides of the aisle, is so in the tank for the financial sector, or so ostrich-like, that it needs Barry Bonds’ orchidometer to measure its minuscule cojones, don’t expect anything to change.