Thread regarding Wells Fargo & Co. layoffs

@1otv nails it

Make up your own mind:

https://youtu.be/Q53Wxx7aLrs

https://www.risk.net/risk-quantum/7841731/wells-fargos-off-balance-sheet-exposures-surged-54bn-in-q1

https://www.propublica.org/article/whistleblower-wall-street-has-engaged-in-widespread-manipulation-of-mortgage-funds

#Deflation

#ChainsawCantFixWithLayoffs

#SoLongStonkBonus

"No one is talking about" this because you have no idea what you're talking about.

• The CMBS market is not "magnitudes larger," it's significantly smaller than the RMBS market today and in 2008, and there's not a load of synthetic CMBS now as there was then. Takes literally seconds to verify this.
• You don't know the difference between reserves and capital
• It's not a "re-evaluation," it's "revaluation," and those assets are revalued every day, because they're marked-to-market
• You don't know what on-balance sheet and off-balance sheet items are, how they relate to securitizations, and what that means for the firm
• The risk of failed payments does not work at all like you describe
• The idea that RTO is driven by a desire to prop up CMBS prices is beyond stupid. Even if Charlie were that sinister, one company's RTO wouldn't make a dent

Many CMBS did take a beating early in the pandemic, but that's already been factored into prices, and banks have been fine. Do you seriously think tens of thousands of investors and analysts around the globe whose entire job is to price these bonds somehow missed the fact that WFH would be bad for rent rolls?

In sum, the only "big short" here is in your understanding of basic accounting, fixed income, and research skills.

Funny thing about a situation like this, the bigger it is, the more powerful people come into play and the more powerful people are involved the more likely that they'll resolve the issue, with a government bailout if necessary. These people have a lot of resources.

In any case, permanently living in a bubble was never the answer. COVID is just like any other disease. It sucks, but we must press on. It's how it's worked for as long as we've been a species. The negative outcomes of becoming 7 billion 'boys in a bubble' is much worse than anything COVID can do to us. There was never a "no one dies" option, as nice as that would have been. This is the real world, and it's a vicious savage place. People tend to forget that until nature reminds us from time to time.

But I brown bag it and just go to and from the office? I don’t contribute to the local economy outside of a weekly, masked Walmart visit. Your argument is moot with me. RTO is just so Charles in Charge can have control of my days an nights. What’s HR’s number again? I might file a preemptive complaint. I hear he wants to pop his head around the corner and say “Hay”.. while undressing me with his eyes.

Again, a lot of broken windows fallacy going on.

There are tons of open jobs. We have restaurants reducing their hours, not because of lack of business, but they cannot get enough workers to fill their shifts. The same is happening to other small businesses.

Forcing people to RTO does not create an increase in aggregate demand for goods and services. It merely shifts the demand. People who are paying much more in gas, work clothing are going to be spending less money in other ways, hurting those businesses.

If I have to RTO, I'm not ordering Grubhub to deliver a meal to my house for lunch. That is taking away money from the driver, the delivery service and the local restaurant. Instead that money likely won't be spent at all as I won't have time to walk and wait in line in the cafeteria much less walk/drive to a nearby restaurant.

The money I spend on gas, more car maintenance, will be less money I have to spend

The sad thing is that rather than evolve the financial model, we'll just devolve to the way it's always been done.

Change is often painful...and it's only for the brave visionaries (who hopefully have some power).

Yes, THIS.

Basic economics. It all has to stop eventually and sooner rather than later. There are so many ancillary workers who are struggling while we sit around our home offices and wax lyrical about whether or not we feel like going back to the office.

On the subject of the former guy's companies and real estate investments, when I worked for a Japanese Bank on Wall Street back in the 90's he was on a list of people that we were forbidden to do business with and that was pretty common across most of the banks. Makes me wonder who is the guarantor on his debt? I guess it will all come out eventually.

Very interesting, it’s refreshing when people actually share relevant industry knowledge here. Thanks for sharing this