Registered Investment Adviser Caleb Lawrence
The major averages enter the final hour mixed on little real news. Auto sales missed again in July despite a 1% gain for the month as per Wards coming in at 16.76 million units annualized, slightly below the 2nd quarter average of 16.85 million units annualized, and 6% lower than a year ago. GM, Ford and Chrysler reported large declines, exacerbating their already bloated inventory condition despite record sales incentives.
Wells Fargo gets caught up in yet another scandal. This time charging its auto loan customers for insurance they didn’t need or were required to purchase. Affecting some 570,000 customers between 2012 and 2016, in addition to the unnecessary premiums the bank also charged numerous other fees related to overdraft, late and other fees pushing some customers into default in the process. Wells Fargo was apparently planning to keep this quiet until the New York Times blew the whistle on them last week. You have to wonder what it will take to get the regulators to do their jobs effectively and throw the book at the banksters. How long, how repeated, and how egregious does the pattern of malfeasance have to become before an institution is labeled as a criminal enterprise? The 3-strikes law adds substantial penalty enhancement to a 3rd felony conviction often turning it into a life sentence and yet we don’t seem to have anything remotely similar for corporations. Another example of the glaring inequality in America and the double standards applied based on socio-economic status or position. Equally surprising is how many times do the customers have to be shown that the company they do business with prosecutes a business model that is literally based on lie, cheat and steal before they decide to seek better treatment elsewhere.