Why Investors Were Disappointed with Goldman Sachs | Where the Money Is - 1/16/14 | The Motley Fool

TL;DR

"Goldman Sachs and City Group report lower than expected earnings, while PNC reports record profits in Q4."

Transcript

the earnings are in and they're well they're earnings you're in the right place folks because this is where the money is welcome to the show I'm Matt copen heffer and right here next to me is David Hansen I am you are still still after all of these all these months all these years David I i' I've heard that the Wolf of Wall Street was nominated for... Read More

Key Insights

• 🐢 Goldman Sachs and City Group's earnings were negatively impacted by the slower trading environment, leading to lower revenue.
• 😘 PNC's record profits were driven by cost cutting, lower loan provisions, increased consumer service fees, and the growth of its mobile and ATM deposits.
• ❓ Peer-to-peer lending can be a risky investment due to the creditworthiness of borrowers, but can also be profitable if managed properly.
• 🌎 Brian Moynihan, CEO of Bank of America, has been successful in reducing expenses and focusing on the bank's strategic vision.
• 👨‍💼 The future of the banks' turnaround will depend on their ability to define their business and rebuild reputation.
• 😃 The valuation and performance of JP Morgan makes it an attractive pick among the big banks.

Questions & Answers

Q: Do you think the Wolf of Wall Street deserves its nomination for Best Picture at the Oscars?

While the cinematography was impressive, the story may not have been great. However, Jonah Hill's nomination for Best Supporting Actor was not surprising, as he did an excellent job in the film.

Q: Why did Goldman Sachs' earnings suffer from lower bond trading revenue?

In a slower trading environment, banks like Goldman Sachs that heavily rely on trading are expected to be negatively impacted. This was not surprising, as other banks, such as JP Morgan, also reported lower fixed income trading.

Q: Will PNC's record profits continue in the future?

While PNC's cost cutting measures and lower loan provisions have contributed to its record profits, it remains to be seen if they can sustain this growth. However, the bank's focus on consumer service fees and the growth of its mobile deposits are positive indicators for future success.

Q: What are the risks of investing in peer-to-peer lending?

Peer-to-peer lending can be risky, as these loans often involve borrowers with lower creditworthiness. It is important to spread investments across multiple loans and be aware of potential fees. However, it can be a profitable investment if approached with caution.

Summary & Key Takeaways

• Goldman Sachs' earnings were negatively impacted by lower bond trading revenue, a trend seen in other banks as well.

• City Group's earnings disappointed, particularly in the consumer banking segment, but expenses are coming down and the company is focused on its strategic vision.

• PNC reported record profits, driven by cost cutting, lower loan provisions, increased consumer service fees, and the growth of its mobile and ATM deposits.