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Lloyd Blankfein, chairman and CEO of The Goldman Sachs Group, is sworn in while testifying before the Senate Homeland Security and Governmental Affairs Investigations Subcommittee on Capitol Hill on April 27, 2010 in Washington, D.C. Have banking practices really improved in recent years? - 

Jeremy Hobson: One of the reasons for the big jump in the stock market over the last 24 hours was yesterday's report card on the health of the big banks from the Federal Reserve. The banks went through what are called stress tests to see how they would perform if things get really bad; and 15 of the 19 biggest banks passed.

For more on this, let's bring in our regular Wednesday guest, Josh Brown of Fusion Analytics. He is with us live, as always, from New York. Good morning.

Josh Brown: Hello Jeremy, how are you?

Hobson: I'm doing well. Well Josh, sounds like the banks are doing well too -- the stress tests happened and 15 of the 19 passed, as I said. But as we've had stress tests over the last few years, both here and in Europe, a lot of times people look back and say they weren't really that tough. Why are they being taken so seriously this time?

Brown: I think what we do here is a lot more serious than what they do in Europe. And I think that these stress tests were pretty transparent and legitamate in terms of the methodology. They basically tested how these banks would react and how the balance sheets would hold up against the scenario where unemployment was 13 percent, which is significantly higher than where it had gotten to, let's say in the depths of the crisis in '09 or 2010.

Hobson: And how did they do so well, Josh?

Brown: Well, they didn't all do so well. But you know, many of these banks have spent the last few years shedding assets; getting out of capital-intensive businesses; rationing down how much leverage -- or how much borrowing they've been doing in order to earn returns. They got the message that it was time to shrink, and almost across the board, they shrank those parts of their businesses.

Hobson: Josh, let me ask you about something else that's getting a lot of attention this morning: an op-ed in the New York Times by a resigning Goldman Sachs executive named Greg Smith. And he says about the culture at Goldman: "I can honestly say that the environment now is as toxic and destructive as I have ever seen it." And he goes on to talk about how the firm, in his view, only cares about its own bottom line -- not the clients. What do you make of this?

What do you make of this?

Brown: It's a little dramatic; it's a little bit Jerry Maguire. I think that the takeaway is really that that's the business that Wall Street is in: to make money. Now, are there people making comments about the customers, etc., that are distasteful? I'm sure you can find the same kind of thing in every other business -- law firms, restaurants, etc. So I think it's a little bit dramatic; I think the rhetoric is a little bit fiery. But I get what he's saying. Wall Street has always been about itself at the end of the day.

Hobson: Josh Brown of Fusion Analytics, thanks as always.

Brown: Thank you.