America risks propping up zombie banks

FROM THE calm of financial markets, it may seem as if America’s banking crisis is over. No more lenders have failed since March 12th. Banks’ stock prices appear to be settling at about a quarter beneath their level at the end of February. Policymakers are no longer fighting financial fires, but are telling congressional hearings about the lessons to be learned. President Joe Biden says the administration has done “a pretty damn good job”.Yet America is far from solving the problems in its small and midsize banks. The markets are tranquil mainly because the federal government is backstopping the system. That means the economy could yet face a slower-burning crisis instead.