Warren Buffett: Banking Good Unless Dumb

Posted by admin on Thursday, September 29, 2016

Warren Buffett Money Quote saying about Wells Fargo that all a bank must do is avoid doing dumb things in order to be profitable – Wells Fargo went way dumb. Warren Buffett said:
 
In the end banking is a very good business unless you do dumb things. You get your money extraordinarily cheap and you don't have to do dumb things. But periodically banks do it Quote
 

“In the end banking is a very good business unless you do dumb things. You get your money extraordinarily cheap and you don’t have to do dumb things. But periodically banks do it” — Warren Buffett

 

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Warren Buffett is saying that banking can be a very profitable business, as banks are able to obtain funds (money) very inexpensively from customers in the form of deposits. However, banks sometimes make poor or “dumb” decisions that undermine their own profitability and stability.

Specifically, Buffett is referring to Wells Fargo, which was involved in an unauthorized account scandal and faced billions in fines and lawsuits. Overall, Buffett’s message is that banking offers good returns, as long as the banks avoid risky, unethical, or illegal behavior that damages their reputation and results in costly legal/financial penalties.

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