Wells Fargo Settles Suit; Xerox-Fuji Deal Gets Complicated; Unemployment Rate Drops
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Estimated Read Time: 3 minutes and 56 seconds
Welp, this is awkward. Early last week Jeff Jacobson, the CEO of Xerox “stepped down,” (read: forcibly removed) along with six board members activist investor Carl Icahn’s request.
The “deal” for Jacobson and his band of fax machine hucksters to see themselves out expired at midnight last Thursday. Icahn fired back the only way an old, rich, white dude knows how: with a scathing open letter.
Let’s recap, shall we?
In January, Xerox and Fujifilm reached a deal for the two antiquated technology giants to merge with Fuji holding the reins. Two weeks ago a New York judge held up the merger amid claims that Jacobson put his own interest ahead of shareholders.
And early last week Carl Icahn completed the corporate equivalent of taking Jacobson out behind the shed to finish him off. Or so he thought …
Water Cooler Talking Point: “I’d be lying if I said I didn’t live for this sh*t. It literally doesn’t get any better than capitalism rearing its ugly head. You’ve got 2M people watching ‘Billions’ weekly when this type of stuff is playing out in real life via the financial media every single day. Read, people.”
FAKE IT ‘TIL YOU MAKE IT
Wells Fargo has agreed to pay $480M to settle a 2016 class action lawsuit. The suit sought restitution for Wells Fargo customers for whom the bank had opened unauthorized bank accounts. Apparently, this is not a ‘best’ practice.
Wells has already been penalized by federal agencies for opening and charging fees on millions of bank accounts without customers’ knowledge or authorization. In January the Fed took the unprecedented step to effectively freeze the bank’s growth.
And just two weeks ago the CFPB and the Office of the Comptroller of the Currency fined Wells $1B, settling charges that the company bullied loan customers into purchasing unnecessary auto insurance and had charged excessive mortgage fees.
Water Cooler Talking Point: “Call me an optimist, but I think brighter times are on the horizon for Wells. Mostly because I don’t think it could possibly get any worse for them. Right … right?”
OFF TO WORK WE GO
The US jobless rate dipped below 4% for the first time since the year 2000, hitting 3.9%. The jobless rate had spent the six months prior at 4.1%.
Not only are people going back to work, but they’re being paid more for their trouble. Average hourly earnings rose 0.1% from last month, and 2.6% from last year. For what it’s worth, the growth missed estimates.
Water Cooler Talking Point: “And yet my deadbeat roommate can’t manage to get a dishwashing job at Olive Garden to pay rent.”
IN OTHER NEWS
- Berkshire Hathaway’s shareholder meeting, dubbed Buffett-palooza, took place this weekend in Omaha, Nebraska. Buffett’s age (87 years old), his successors (likely Greg Abel and/or Ajit Jain), and Berkshire’s reputation as a buyer-of-choice were popular topics.
- Deutsche Bank is perfecting the pull out method. Late last month, the company announced it will lay off roughly 10% of its US workforce, mostly in its investment bank. And now the firm plans to leave Wall Street altogether, moving its NYC HQ to midtown. Likely to make it more difficult for their Deutsche employees to pop over to competitors for lunch interviews.
- Toyota plans to invest $1.1B in its Canadian SUV manufacturing operations. The good news is that the expansion will create hundreds of jobs. The bad news is that NAFTA negotiations are “ongoing.”
- Why pay $10 for MoviePass when you can get Sinemia for $4.99 per month? This must be how the 8-Minute-Abs people felt when 7-Minute-Abs dropped.
- Argentina’s Central Bank hiked interest rates for the third time in eight days, to 40%. You read that right: 40%. The country is facing (yet another) economic meltdown and government officials hope this will stop the bleeding.
- US indices were up Friday:
- DOW: +1.39%
- S&P 500: +1.28%
- NASDAQ: +1.71%