Why do people hate wells fargo




















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The Fed is banning its policymakers from buying individual stocks. Economist: Supply chain crisis is here to stay for 'quite some time'. Crypto expert: Jamie Dimon's view of bitcoin is 'American-centric'. Economist: Expect inflation 'as long as the pandemic is raging'.

Here's what debt showdown could mean for markets. How can investors protect against inflation? Scott Galloway weighs in. Why global investors are focused on Evergrande. Petco CEO explains how 11 million new pets in boosted the business. Cathie Wood's Ark Invest cuts exposure to China. For years, Wells Fargo's laundry list of scandals and legal problems had only a fleeting impact on its once-monstrous bottom line. That is no longer the case. Wells Fargo WFC is the only major lender during the pandemic to lose money -- its first loss since the financial crisis.

And that red ink was driven in large part by the crushing penalties imposed two years ago by the Federal Reserve for abusing customers. Goldman Sachs is crushing it as booming markets trump Main Street turmoil. Wells Fargo is such a mess that it's being forced to slash its coveted dividend. During the Great Recession, Wells Fargo was so strong that it was among the last of the banks to touch its dividend. Today, it's the first.

The Federal Reserve recently approved a 10 percent increase in the quarterly dividend the bank pays to its shareholders, allowing those profits to be converted into straight cash for its owners. Ever since the financial crisis, the top minds in global finance have wondered whether the biggest U.

But Wells Fargo reveals a different problem: a chronically dysfunctional, predatory bank that is perfectly profitable. Regulators might focus on fixing individual problems when they arise, but the bank, insulated for decades from serious penalties like prosecution or dissolution, has no pressing incentive to head them off.

Several of them became the bank we call Wells Fargo today. It made a bid for the similarly-sized First Interstate Bank and ended up acquiring the firm in a hostile takeover. The result was an almost immediate debacle. As The Wall Street Journal recounted in :. Angry customer complaints went unanswered at understaffed branches and telephone support centers.

The following year, the combined bank went on an acquisition bender before Wells Fargo and Norwest had even finished integrating their systems, picking up 13 smaller firms in Texas, Pennsylvania, Wyoming, New York, Colorado and Minnesota.

But in the meantime, the bank kept growing, buying back big blocks of its own stock and paying out huge dividends to its shareholders. In the two years after the Norwest merger, Wells Fargo announced the acquisition of 41 separate companies. None of this would have been possible without some help from the government. Until , it was illegal for banks to expand across state lines, and when the Clinton administration repealed the Glass-Steagall Act in , they were also permitted to merge with insurance companies and investment banks.

Advocates of deregulation argued it would help make banks more stable; if one line of business faltered, the bank would have alternate revenue streams to keep it afloat.

Wells Fargo kept expanding. But it never really got its basic business in order. Still, applications for checking accounts tumbled 40 percent, to about , Last year, the bank typically opened around , to , a month, according to bank data.

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