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Wells Fargo & Company Message Board

mr.schnider 155 posts  |  Last Activity: 4 hours ago Member since: Apr 26, 2008
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  • Reply to

    Tsipras' open letter to Germany

    by wpd_deleter 16 hours ago
    mr.schnider mr.schnider 4 hours ago Flag

    The part about throwing money down a black hole seems right on to me.

  • Reply to

    Durable goods

    by mr.schnider Jan 27, 2015 10:39 AM
    mr.schnider mr.schnider Jan 27, 2015 2:58 PM Flag

    from another article today:
    Monthly sales of newly built homes, a volatile reading, bumped up nearly 9 percent in December from a year ago, according to the U.S. Census Bureau. While not a robust month for housing historically, the December jump may be due to a shortage of supply among existing homes. The median price of a newly built home rose 8 percent from a year ago.

    The nation's largest home builder, D.R. Horton (DHI) reported fiscal first-quarter earnings Monday which beat estimates. Executives of the company cited its lower-priced, entry-level "Express Homes" division for part of its success as well as several incentives, such as free appliances.
    "Our weekly sales pace has accelerated in January, and we are well-positioned to capture demand in the spring selling season," said Donald R. Horton, chairman of the board.

  • Reply to


    by democrattlol Jan 26, 2015 5:07 PM
    mr.schnider mr.schnider Jan 27, 2015 10:45 AM Flag

    democrattlol, thanks for the post. Coming from Richard Davis it means a lot. That is a good sign if home equity loans for home improvement are on the rise. There for awhile it seemed impossible to obtain a "cashout" loan.

  • mr.schnider by mr.schnider Jan 27, 2015 10:39 AM Flag

    The economy was slowing down noticeably in November and December, however that does not necessarily mean it will continue to slow down during January and February. It feels awful because momentum is paramount; however we all knew things would slow down from 5% GDP, its just a question of whether 1q-15 will come in under or over 2% During the past couple of weeks there have been enough cross currents that came in positive that I believe we will stay away from negative growth at least for this winter as new building permits are doing OK.

    Quote from one of the news agency':
    "The Commerce Department, via the Census Bureau, indicated that this decrease put the durable goods readings as negative in four of the past five months -- and it followed a 2.1% decrease in the month of November. One thing to consider is that the report is weak enough that it almost certainly will force economists to ratchet down their fourth-quarter gross domestic product estimates."

  • Reply to

    Art Cashin told CNBC

    by jerrycruncher Jan 26, 2015 11:28 PM
    mr.schnider mr.schnider Jan 27, 2015 10:18 AM Flag

    Thanks for the post, Art Cashin is a man of tempered reason.

  • Reply to


    by fsbsgillie Jan 26, 2015 6:55 PM
    mr.schnider mr.schnider Jan 26, 2015 8:08 PM Flag

    Here is some more of the article:
    PMorgan Chase Chief Executive Jamie Dimon cited two reasons that the bank continues to avoid making FHA loans.
    "One is the ongoing liability on the production side where the insurance was worthless over time, and the second is just the cost of servicing FHA loans when they go in default, and they have a much higher chance of going into default than not," he said.
    Dimon is concerned that making government-backed mortgages to borrowers with a relatively high likelihood of default is more trouble than it is worth, according to FBR Capital Markets analyst Paul Miller.

    "When you do something wrong, the FHA doesn't come after you. The Department of Justice sues you for triple damages," Miller said.

    "What the government has done is criminalize the foreclosure," he said.

    JPMorgan Chase paid $13 billion to the Justice Department in November 2013, the largest of several fines that it has paid since the financial crisis over mortgage-related misconduct. BofA has paid even more, while Wells Fargo, despite facing less liability than those banks, has still shelled out billions in government fines.

    Although banks have faced the greatest liability over mortgages, that doesn't mean that nonbanks are immune to regulatory pressure.

    Just ask Bill Erbey, former chairman of Ocwen Financial (OCN) . He relinquished the company's banking license in 2004 in the hopes of being less tightly regulated, but a crackdown by New York financial services superintendent Ben Lawsky cost Erbey his job and much of his net worth as Ocwen shares have declined some 85% over the past year.

    Sentiment: Buy

  • mr.schnider by mr.schnider Jan 25, 2015 11:22 PM Flag

    Greece elected a different party into power today.... the thing about a democracy is that they are prone to elect people unwilling to sacrifice. The people of Greece have spoken, how long will it now be until they realize what a mistake they made. Do they think they are leaving the European union?
    I would not imagine our markets will do very well until our Fed speaks later in the week. Any thoughts?

  • Reply to

    Life is great:)

    by jerrycruncher Jan 25, 2015 6:20 PM
    mr.schnider mr.schnider Jan 25, 2015 11:14 PM Flag

    QE benefited those who borrow. Both corporations and individual people alike. Now please explain how QE benefitted the banks? Forget that prior to QE that Wells Fargo' net interest margin was 5% and now has shrunk to 3%, putting aside that fact that they are making billions less than if the Fed Funds rate were normalized.... what argument is there for QE benefitting banks?

  • mr.schnider mr.schnider Jan 24, 2015 12:31 PM Flag

    That doesnt seem correct, normally one would think that in December banks put off notification of foreclosures until the new year. Not sure, perhaps I am wrong, maybe it is with actually foreclosures that is true.

  • Reply to

    The world is planning for 'QE infinity'

    by jerrycruncher Jan 21, 2015 12:01 AM
    mr.schnider mr.schnider Jan 24, 2015 12:28 PM Flag

    the context of my earlier reply was much different than what you changed it to be.
    I was not pointing out whether or not deficit spending was a good idea, but rather pointing out to jerrycruncher that it is wrong to thing that the printing of money is only helping the wealthy.

    IMO America is arguably the greatest country in history due to a few main reasons, such as its natural resources, legal system, and economic system which dove tails with its culture of individualism. Our legal system and economic system has made it very easy to obtain credit which has given good chances for individuals to have decent chances to move up (and down) from the lower income class to middle or higher income class.
    In other words your ability to get a $10k credit card or student loan has helped many people start their own business.
    Now when talking about national govt debt, I would say America is an example of a country that borrowed money back in its infancy then paid it off. However somewhere along the line in our history, perhaps during the 60's we increased govt programs in such a way that by the 1970's I think as a country we all kind of gave up the idea of ever paying off the national debt. Then the 1980's came and somehow things really got out of whack with deficit spending gone wild but yet everyone "felt" great because of wage increases and GDP growth.
    Can govt spending debt solve problems? In some instances yes. But as seen from the Reagan administration it doesn't seem like our democracy is up to the challenge using it judiciously which if it continues will end very badly for Japan first, then the USA in the next century.

  • Reply to


    by democrattlol Jan 21, 2015 7:39 AM
    mr.schnider mr.schnider Jan 23, 2015 1:31 AM Flag

    keeb, I agree that USB appears to have had a decent earnings report for 2014. However since you brought up comparing it to Wells Fargo, to tell you the truth Wells has what is called a "core loan portfolio" that they try to grow, as well as a "liquidating portfolio" of loans they allow to runnoff or selloff to the magnitude of a couple billion every quarter.
    Their core loan portfolio they grew their balances at the rate of 8% yoy, and 13% on a linked quarter.

    For such an immense difference in linked quarter performance something is going on here. Either Wells Fargo lowered their loan guidelines tremendously, or else USB tightened up quite a bit. But you cannot say that USB loan growth seems on par with WFC. My take on the situation is that Farmer John "put the plow out". Wells grew their core loan portfolio from $775 billion to $801 billion linked quarter. So their 13% is an annualized rate, whereas USB grew their loan portfolio 1.2% linked quarter.

    USB had a decent quarter, but it is not on par with Wells Fargo. Time will tell if Wells got too loose.

  • mr.schnider mr.schnider Jan 22, 2015 10:20 PM Flag

    sorry, I mispoke, that was a 5 yr cd with a 1.35%.

  • mr.schnider mr.schnider Jan 22, 2015 10:18 PM Flag

    Its called capitalism where banks compete for depositors, however Wells has an issue with having too much capital to deploy as it is so they are not trying to aggressively seek new depositors.
    Take "BOFI" for example, they are growing their balance sheet at a rate of over 30% annually for the past 6 years. Their SAVINGS rate is .75% and their 1yr cd rate is at 1.35%
    They need depositors because they have places to deploy the capital. For example they have been issueing common shares to raise capital whereas Wells is buying it back.
    Simple capitalism, nothing to get sad about.

  • Reply to

    balance sheet

    by mr.schnider Jan 18, 2015 5:17 PM
    mr.schnider mr.schnider Jan 22, 2015 7:33 AM Flag

    Soon after Obama came into office he changed the course our leaders had taken and demanded that the banks start giving the TARP money back.
    Stress Tests were done and Wells had to issue common stock, then when they were given the green light to give back the TARP they had to issue some more common stock. However soon after that, I would say sometime in 2010 while we still had misinformed bloggers and talking heads touting Wells was insolvent, Wells started to consistently paydown its long term debt. I forget how much but it was hundreds of billions. Not only that they started to call back billions of their preferred shares as well.
    I think it was in 2013 or perhaps as early as 2012 when Wells got down to about $125 billion in long term debt, but that coarse got shifted as regulators did not like how the TBTF banks kept improving their deposit base to the point where Wells fargo pretty much could fund their whole balance sheet with just deposits.

    A couple of years later, even though Wells is no need of the liquidity, and now have a problem of having too much capital, Wells has been issuing long term debt going from $125 billion (a couple of years ago) up to $185 billion just so that if and when there is another banking crises that the tax payers will not have to be in fear of making depositors whole.

    There seems to be a constant theme where taxpayers dislike banks putting depositors money at risk, and that translates into banks must raise capital to fund their balance sheets.

  • mr.schnider by mr.schnider Jan 21, 2015 10:31 AM Flag

    Single-family permits rose 4.5 percent to their highest level since January 2008, with permits in the populous South hitting their highest level since February 2008.

    This is opposed to November numbers that were a negative 1.6% which were very soft.
    Add this on to week retail sales for December, slowing GDP, slowing RE prices, weaker wages and there were indicators that we were going to duplicate last years pattern of dipping into a soft patch.

    However now with the increase in new home starts in tandem with higher consumer optimism there seems to be no doubt that GDP for 1q-15 will come in above 3% once again.

    If we were to call off the constraints on doing business with Russia, Iran, Cuba it would just be too good to be true.

  • Reply to

    The world is planning for 'QE infinity'

    by jerrycruncher Jan 21, 2015 12:01 AM
    mr.schnider mr.schnider Jan 21, 2015 10:20 AM Flag

    The so called printing of money, is better thought of as the increase of credit.
    Dont quote me on this, but I think the biggest increase in debt is for government spending, student loans and auto loans. Lowered interest rates helps debtors, it is not an exact correlation that the rich are getting fed the money although businesses do leverage debt.
    I think what is confusing you is that the top one percent have been doing relatively well during the past 4 years.

  • Reply to

    balance sheet

    by mr.schnider Jan 18, 2015 5:17 PM
    mr.schnider mr.schnider Jan 20, 2015 10:18 AM Flag

    My long winded post got deleted from yesterday, however to say it concisely, regulators want holders of Wells Fargo debt ( bonds) to take on a sufficient amount of debt so that doom and gloom bloggers don't scare the American taxpayer if ever a large bank is seized by the FDIC again.

    Not only do I believe the regulators forced Wells to issue more bonds, but I also am prone to believe their regulators were pushing them to re-issue preferred shares just after they had been retiring it.
    And before all of this happend they also pushed to have Wells issue additional common shares.

    It doesn't matter that the taxpayers did not lose a dime to the FDIC, it was the banks that funded the FDIC, but what the public is afraid of is they are backing the FDIC.

  • mr.schnider by mr.schnider Jan 18, 2015 5:17 PM Flag

    For those of you that are like me and have not looked at the balance sheet very often this past year there are a couple of things that are interesting.
    First of all, 2 or 3 yrs ago their long term debt was only $120 billion, they have now built that up to around $180 billion or so. My guess is that this huge build up is do to regulators wanting to see bond holders take a hair cut during the next financial crises.
    Also, there is around $250 billion in cash parked at the Federal reserve, which is more that enough to pay off their long term debt.
    Something that is noticeable is that the value of their mortgage servicing rights dropped from $15 billion down to $12 billion
    Also during during 2014, if I read this correctly, they went from having $6 billion in US tresuries on their balance sheet at the begining of the year to having $66 billion at the end of the year. Most of them are being held to maturity which means they are shown "at cost" and will not impact their comprehensive income when rates start going up. (Looks like John Stumpf must be reading the yahoo mb, LOL)

    The balance sheet if remarkably strong, 90 day delinquencies improved leading to lower charge offs for next quarter, mortgage refinances will put a slight wind at our back, my understanding is that expenses will improve next quarter, but I also think they are signaling this next quarter will be the last for loan loss reserves releases and that soon there may be talk of 2015 being the last year for non-accreatable interest income on the Wachovia pick a pay loans (not sure).

  • Reply to


    by democrattlol Jan 16, 2015 8:22 PM
    mr.schnider mr.schnider Jan 17, 2015 10:08 AM Flag

    Wells Fargo 16 straight quarters of earnings per share increases is about to come to an end when 1q-15 is reported three months from now. However USB will probably have another year of earnings growth in 2015 as with PNC.
    As for BAC, C, and JPM they have alot invested overseas and dealing in treasuries, as we come closer and closer to balancing the budget there is less and less product for these three bond market makers to make fee income on.
    Whether USB and PNC unfortunately get stuck with these other behemoths is yet to be seen.

  • Reply to

    Possible correction

    by fsbsgillie Jan 15, 2015 7:06 PM
    mr.schnider mr.schnider Jan 16, 2015 10:44 AM Flag

    Gillie, I made comments a couple months ago that analysts for WFC would lower 2015 estimates in the last half of January after earnings. Instead of 4.22 my guess is they will come down to a disapointing $4.10 for all of 2015

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