Today the market is rallying on reports of record profits from Wells Fargo this quarter. Does anyone really beleive them? It was only a few months ago that they had to receive a bailout from the Treasury to the tune of $25B. What is unlcear is if this "record profit" includes any writedowns associated with all the delinquent loans they have on their books. But wait, ah ha, they got FASB to relax rules on writing down depreciated assets!! FASB now alows them to value their assets how ever they want so its no suprise that they are now making gobs of money. If the banks are now making record profits then can someone please tell me why we need to subsidize the banks even further than we already have with the toxic asset program and the other bailout programs? Here is the CFO on CNBC, I'd note how CNBC is really asking the tough questions:
I love his response to the issue of stock issuance (which is obviously behind this pump), the weasel CFO said:
"We're raising more money everyday by making more money everyday"
Well, you jerk, if thats the case, then you can give back our $25B and you can forget about participating in any future government programs. These banks are essentially getting money at 0% right now then turning around and lending it to the rest of us for 5% (on mortgages) or up to 10-20% (on credit cards). So let me just add, WFC, you can go F*%# yourself.
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