There has been discussion of the possibility of suspension of the "Mark-to-Market" accounting rule. This has contributed to the current euphoria surrounding financial stocks. The logic is that this would stop the death spiral in the capital base of many of the banks and other financial companies, an action that is at the root cause of our current financial crisis.

A suspension of "Mark-to-Market" accounting would definitely give breathing room to banks. However, there are other alternatives, such as suspending financial regulatory requirements, which could have the same effect.

More of the details of the so-called stress test is seeping out into the public. And combined with more information about the next round of taxpayer investment in zombie banks, the picture is ugly. To get lending going again, it would be better to create new banks. And to clean up toxic waste, we could let the FDIC buy the bad loans out of mortgage-backed securities.

The stress test involves calculating the change in a bank's tangible common equity -- what's left over after selling a bank's assets and then paying off its liabilities under two scenarios. The base case scenario is that GDP falls 2% in 2009, unemployment rises to 8.4% and home prices plunge 14%. And the "adverse" scenario assumes GDP slumps 3.3% in 2009, unemployment climbs to 8.9%, and home prices tumble 22%.