Many people are suspicious of the rally in U.S. bank stocks. Some even go so far as to suggest the market is being manipulated to allow insolvent banks to recapitalize by issuing new shares to investors.

For the past two weeks, testimony at the criminal fraud trial of Garth Drabinsky and Myron Gottlieb has focused almost exclusively on the last quarter of 1998 as defence lawyers grilled former Livent controller Chris Craib. But today, prosecutors brought the trial back to the origins of Livent and the ...