Fed Orders Wells Fargo to Clean Up Its Act

The video discusses the impact of a cease and desist order on a company's stock, highlighting its overvaluation and the challenges it faces in maintaining its franchise value. The Federal Reserve's requirements for lifting the ban include improved risk management and board changes. The video also explores the accountability of the board and the opportunities for competitors like Bank of America and JPMorgan Chase to gain market share.

What immediate effect did the Federal Reserve's cease and desist order have on Wells Fargo's stock?

• The stock value remained stable.

• The stock value increased.

• The stock value decreased.

• The stock value doubled.

What is one of the main challenges Wells Fargo faces due to the Federal Reserve's order?

• Increasing their balance sheet.

• Limiting the number of deposits they can take.

• Expanding their mortgage origination.

• Reducing their customer base.

What changes are necessary for Wells Fargo to lift the Federal Reserve's ban?

• Reducing employee salaries.

• Improving risk management systems and changing board members.

• Expanding their branch network.

• Increasing their marketing budget.

What role does the Federal Reserve play in Wells Fargo's board of directors?

• They manage the board's daily operations.

• They influence board member selection and hold them accountable.

• They dictate the board's salary.

• They appoint the CEO.

Which competitor is likely to benefit from Wells Fargo's challenges?

• Deutsche Bank

• Goldman Sachs

• Bank of America

• HSBC