Today the economy is significantly stronger than it was four years ago, although conditions are clearly still far from where we would all like them to be. Because bank credit for households and businesses is critical to continued economic expansion, it is positive for the recovery that banks are also notably stronger than they were a few years ago.
For example, premiums on bank credit default swaps have fallen by more than half of their 2009 levels, and other measures of bank risk have also declined substantially.