After an extended weekend due to the Easters break and a protest, yours truly is back amongst the midst of writing the blog. The weekend witnessed many things coming into perspective. The Barclays Premier League witnessed Manchester United holding a firmer grip on the title with their city rivals losing the much anticipated clash against a resurgent Arsenal team. The Indian Premier League have seen numerable closely-contested matches lately as the table is finally taking shape and distinguishing the potentials title challengers and others. Leaving the sports behind, the week had begun with Bernanke’s comments on the banks requiring more capital to ensure the stability of the financial systems.

Bernanke re-affirmed that regulators were taking steps to compel financial institutions to hold higher capital, even if they allow for a long period of implementation to prevent any market disruptions. Ironically, Bernanke made the comments the same day that an international bank lobby group, the Institute of International Finance, urged policymakers in regulating the industry.

Strong capital standards, new liquidity requisites and rules that limit activities all restrict banks’ ability to provide businesses and households with the credit needed to enhance economic growth. Whether big banks have adequate levels of capital to protect against possible losses has been an ongoing source of contention.

In the remarks, Bernanke said the US economy has yet to fully recover from the effects of the financial crisis, and regulators must continue to find new ways to strengthen the banking system. Bernanke focused on the lingering blind spots from financial authorities trying to prevent a repeat of the 2008-2009 melt down. He said financial stability matters had historically played second fiddle to monetary policy issues in the list of central bank priorities, but the crisis changed that.

Bernanke also said the recent stress tests will become a regular feature of the supervisory landscape, and for that reason the latest round of tests is being reviewed to identify possible areas of improvements. He confirmed a worry that he and other top policymakers have expressed about the continued vulnerability of money market funds.

Bernanke’s comment comes at a time when the US economy is presumably improving but ironically his comments have dented this very thought. Watch this space for more updates!