Wall Street Preps to Flex its Muscle for the Fed

The biggest stories from Thursday’s world of finance.

Mar 20, 2014 at 2:35PM

Could the stress tests break the big banks, and why are insiders at Zillow selling? On today's Where the Money Is, Motley Fool banking analyst David Hanson unpacks the stress test process for investors, and digs into why Zillow's CEO is selling off shares.

The results of the Fed's stress test are due to be announced today at 4, when investors will get to see just how prepared the big banks are in case of another major economic downturn. David discusses how the stress tests work and the three scenarios that the banks will be tested on, and he also shines some light on the biggest risk for shareholders of a bank that performs poorly in the tests.

Stress tests are also a way for the big banks to prove that they have the ability to pay out higher dividends or initiate a share repurchasing program, without putting shareholders at risk. David discusses whether or not Bank of America could raise its famously low dividend after this round of tests, and when investors might see that change.

And finally, while shares of Zillow have had an impressive run recently and delivered stellar growth for investors last year, two key insiders among the company's top brass including CEO Spencer Rascoff are now selling off shares. Should investors be worried? As the old Wall Street adage says, while there is only one reason to buy, there are many possible reasons to sell a stock. David looks at why these two insiders might be selling, and tells investors he's not concerned.

Don't stress about this tiny, amazing bank
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David Hanson owns shares of Zillow. The Motley Fool recommends Bank of America and Zillow. The Motley Fool owns shares of Bank of America, Citigroup, and Zillow. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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