Posted on 10/07/2016 11:51:41 PM PDT by nickcarraway
Wow that’s bad reporting!
Personally, I think it’s time to create new words for banks that deal in “other services”. When you look at Sachs or Wells Fargo....it’s just a legit gambling enterprise tied to what was a former bank.
If Glass-Steagel had not been tossed this might have not played out this way for this elderly man. I like that Trump has said he wants to see Glass-Steagel back.
One thing I have never understood. I have known people who make a very comfortable six figures. And then they turn their resources over to a guy who makes five. I used to try to tell them how stupid it was but they were libtards so I just attributed it to that. I would tell them, “You are smart enough to earn six figures, make your own investment decisions.”. And then wonder when they lose money.
IN THIS DAY AND AGE what the #### can they know that we can’t.
You’re right.
From Bloomberg, as I recall.
It said just short of 2 million customers were affected.
It said the total loss to customers was $2.6 million.
That works out to $1.30 per customer.
If those numbers are correct, this is one of the most over-hyped “scandals” in the history of journalism.
I believe the 2M customer number. I can’t find loss numbers quickly via a google search. But the fine alone was $180M or so, which came after settling up with the customers.
http://www.reuters.com/article/us-wells-fargo-accounts-business-exclusi-idUSKCN124261
What astonishes me is the number of people who willingly go along with the dishonesty & the lies. That so many remain silent just amazes me. And this applies not only to WF but to all aspects of our government. So depressing.
Invest in a market index mutual fund of your choice with a major broker, allocate some of your investments to bonds to mitigate risk, manage the stocks / bonds allocation mix according to your age and estimated time of retirement, always be buying into the market, whether up or down, DON'T sell on a crash, put no more than 4% into any given single stock, and LEAVE THE DAMN THING ALONE after that.
You, too can be an investing genius. But start now.
Thirty years ago I used to do that sort of thing. With so much crony capitalism I don’t now. Although eight years ago I cashed out and put everything on gold at $800.
But who gets the money referred to as “fine”. Typically they donate to some libtard organization that just launders it to Rats.
” That works out to $1.30 per customer.
If those numbers are correct, this is one of the most over-hyped “scandals” in the history of journalism. “
That’s about right.
Its actually on of the most foolish business decisions every made.
That small amount of money is costing the company hundreds of millions in lost reputation and lost profits.
And to set things straight; this was discovered and corrected internally.
Not by government bureaucrats .
The main guy? The head honcho?
Bad grammar as well as bad reporting.
Despite the changes in the law, money handling is best done by specialists. Banks are best at banking, insurance companies are best at insuring and investment companies are best at investing. When they cross those lines it is not to your benefit. A bank selling you insurance or investments will never be as good as specialists. And run for your life if a banker tries to get you to buy an insurance product like an annuity as an investment.
I learned about 15 years ago how dishonest and slimebally WF was and vowed to tell everyone. They admitted they didn’t check signature cards and they wanted my fingerprint to cash a $20 checks on one of their own accounts.
Another time they knew for a fact a person had died. She was a prominent person in the area and a couple of the tellers had attended the funeral. But they raked me over the coals wanting my personal info. from my last tax return to the papers on my house (which had never had any connection with them), etc. and basically wanting me to go dig her up for them. Evil, evil company. I’ve never had an account with them and never will.
That so many people were complicit in it just astonishes me.
Evil is truly rampant.
I think, in some cases, it lis like using a lawyer or a mechanic, these specialists may make less, but they have expertise. It is more a failure to continue to monitor performance than anything else. Even Trump and other ultra wealthy probably don’t manage all their investments themselves any more than they would be their own counsel. The problem arises when financial advisors take their eye off the ball or keep working within the same paradigm that might have worked well for decades but doesn’t reflect changed circumstances
Yes, it is. They didn't even provide a link to the ad. But, the ad is also content-free.
Here's what really happened:
According to the Dallas Morning News, Harber’s beef with Wells Fargo began on Aug. 24, 2015. Believing that turbulence in the European markets that morning would create a buying opportunity on Wall Street, the millionaire investor—he owns Las Vegas real estate and various small banks and marinas, according to the New York Times—told his Wells Fargo broker to buy $34.8 million in stock in companies like Apple, ExxonMobil, and Chevron.
A longtime client—Harber told the Morning News that he’d been a brokerage customer of Wells Fargo and its predecessors for 43 years—he bought the shares on margin, meaning that the bank loaned him most of the money.
But when the market tanked that day—the Dow Jones Industrial Average was off almost 1,100 points at one point—Harber told the Morning News that Wells Fargo informed him he had to deposit the $34.8 million by 3 p.m. When he could only come up with $19 million, Wells Fargo decided to liquidate his account, causing him to lose some $5.8 million, the Morning News reports. Adding insult to injury, Haber says he was charged $483,000 in brokerage fees to boot.
“In those 43 years, I did hundreds and hundreds of millions of dollars worth of trades. Not one time have I ever been one day late in meeting a margin call or covering a short or paying for stock,” Harber told the Morning News.
Short version: he bought a lot of stock on margin -- borrowing money against existing assets to buy it.
The market tanked, and he got a margin call. Translation: he didn't have enough remaining value in the assets he held to back the money he had borrowed.
It's like the value of your house dropping below the outstanding balance of your mortgage. You are "underwater", and can't pay off the mortgage if you sell the house.
But here's the deal: the SEC has very specific rules about margin requirements. You can be a bit underwater, but if you drop below a certain threshold, you must come up with the shortage. If you don't do so within a certain amount of time, the brokerage must sell assets itself until the margin call is met.
More information from the SEC: Margin: Borrowing Money To Pay for Stocks
It doesn't matter how well this guy has done in the past. Wells Fargo is bound by SEC rules. His only recourse is to prove they violated SEC rules.
This guy was making his own investment decisions. He bought a lot of stock on margin, and got a margin call.
See my post #19 above for more.
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