Money quote:

> Regulators then heard the numbers, did a bit of modeling in Excel, and then went into wartime execution mode. Regulators have, of course, not declared this war, because it is a war on the public’s perception of reality, and to declare war is to surrender.

SO MUCH of this drama is really a war on perception more than anything else. Banks being "underwater" on 10 year treasuries is only a problem *if everyone thinks its a problem* and if everyone just goes about their daily business ignoring this story, then after 10 years all the bonds mature and nobody is the wiser.