MarketFoolery: 03.14.2012
MarketFoolery
The Motley Fool
4.7 • 1.7K Ratings
🗓️ 14 March 2012
⏱️ 20 minutes
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Summary
The Fed releases results of stress tests on the largest U.S. banks. Our analysts talk about what it means for investors and share a few stress test-worthy stock ideas.
Transcript
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| 0:00.0 | It's Wednesday, March 14th, and this is Market Fullery. |
| 0:05.0 | I'm Chris Ellen joining me in studio today for Motley Fool options, Jim Gillies, and from |
| 0:09.1 | Motley Pro, Jeff Fisher. |
| 0:10.6 | Gentlemen, good to see you. |
| 0:11.9 | Chris, good to see you. Chris, good to see you. |
| 0:13.3 | We are going to talk options. |
| 0:14.4 | We're going to talk Encyclopedia Britannica, |
| 0:16.9 | but we are going to start with banking. |
| 0:19.8 | The Federal Reserve released the results of its latest version of a bank stress test yesterday. |
| 0:26.0 | This is where they're testing banks ability to withstand a quote depression type scenario, |
| 0:32.0 | including a 50% drop in stocks |
| 0:34.6 | 21% drop in housing and an unemployment rate of 13%. |
| 0:39.1 | 19 banks were tested, 15 of them passed the ones that didn't, Citigroup, MetLife, SunTrust, and Ally Financial. |
| 0:47.8 | A lot to get into here, Jim, I'll just start with you. |
| 0:50.9 | What does this say to investors? |
| 0:53.0 | Have confidence in the banking system? |
| 0:55.0 | And was it essentially set up that way? |
| 0:57.0 | I mean, because the cynical person... |
| 1:00.0 | Me? |
| 1:01.0 | Could look at the Federal Reserve and say, hey, look, this is just, you're just doing a dog and |
| 1:06.2 | pony show to instill confidence in the market about the banking sector. |
| 1:11.0 | I'm not sure I'd call it a dog and pony show. I don't actually |
... |
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