Demographic or socioeconomic characteristics of the people being served . First of all, and i dont know im not trying to be careful on words here, i dont know what fraud exactly. I know whats right and i know whats wrong. I dont know what the intent of all these people were. But to answer your question specifically, there was no that i understand racial or ethnicity difference other than what the communities are, because we try to have people in our banks that represent the communities. So well take racial and ethnicity off the table here. As someone who also represents a district heavily populated by seniors, im worried that wells fargo may have intentionally preyed upon those they saw as vulnerable. Do you believe seniors were purposely targeted as a result of employees stretching to meet their sales goals . In fact weve looked at because we actually capture data so we could tell that and, no, there was no disproportionate it did not in fact it was younger people, not seniors. If there was any emphasis at all or any all right, another day, another grilling for wells fargo ceo john stumpf, as you see there. Were going to take you back washington, d. C. Inside that hearing room at some point during the Halftime Report today, but just to get you caught up, mr. Stumpf has been there all morning long saying there was no orchestrated effort or scheme in that false account scandal. That he will not rest until the problem was fixed. He was also forced on multiple occasions to defend some stock sales around the time of the disclosure of that scandal. As i said, well get to wilfred frost who has been there for the entire time. As you see at the bottom of your screen righthand corner, s p down 4. 5 points. The Dow Jones Industrial average down by a little more than 39 points. Right at 18,300. Theres the s p call, as i said, and the nasdaq as well, which is down a bit more than 22 points. That is nearly onehalf of 1 . Thats where the russell 2000 is. As i mentioned, our own wilfred frost covering this story from the outset inside the hearing room has jumped outside now. Whats the highlight . Reporter the hearing started actually pretty well for mr. Stumpf. The questions were calm, his responses much better than last week, fairly considered highlighting a few key points. You mentioned some of them. He also got across the point that that 2 million of fake accounts may end up being some 75 low once internal investigations are finished. He also revealed its not just executives but also the whole board that are facing the internal investigation. Though sadly for him, that wasnt enough to stop the temperature rising soon after. The whole board needs to go. If theyre going to allow someone to be in charge when time after time you just talked about you fired 5300 employees. When you found out that they are doing something wrong. They were fired. Because they were doing something wrong. Well, something is going wrong at this bank and you are the head of it. So shouldnt the board then turn around from your own admission, if the buck stops with you, as you came out here and said i apologize, the buck stops with me, and you have to also admit that criminal activity was going on in your bank, then you should be fired because it stops with you. In his defense, mr. Stumpf wasnt often given that much time to respond to the questions, or perhaps i should say the statements that he was facing. Often words like felon, criminal, fraud were used pretty liberally. Lets remember the investigation did not prove any outright wrongdoing. Either way, the pressure as you saw there intense. Not just on wells fargo, on other banks too. We have institutions that are too big to fail. In 2008 we found they were too big not to bail. Eric holder has told us that they are too big to jail saying that he fears for putting them for bringing a criminal indictment. We now learn that theyre too big to manage, too big to regulate, its time to break them up. Now, we were told today that mr. Stumpf facing the questions today, this would be a shorter hearing. As you well know, it continues. Thanks so much. Wilfred just outside the hearing room. Lets bring in now mike mayo who joins us on the phone from london. Mike, welcome back. Thanks for having me. Does stumpf survive this . Its tough. My takeaway about the banking industry, you heard the phrase crossselling mania and crossselling bubble as it refers to the industry. So what i think happens here is if you dont want people in Bank Branches to offer products, extra products to customers, i think this accelerates the transition from physical banking to virtual banking. What i mean by that is there are 90,000 branches at the start of the decade. Theres 87,000 branches now. And its possible that if the industry reduced branches back to the level of the 1950s, and thats relative to households, youd have a reduction in 35,000 branches and 200,000 jobs eliminated. So be careful what you wish for. Be careful about the unintended consequences. Again, if the goal is not to have the branch employees, you know, offer more products and they arent as productive, obviously you always have to be within the law. Right. But i think this will accelerate the stream lining of the Branch System in the United States. We dont need 87,000 branches. That would help improve efficiency and reduce pressure on the branch employees to sell, if thats the goal of the regulators. Let me get back to the original question, if i could, mike. Are you modeling now for wfc without stumpf . I will say im shocked last week that the ceo didnt answer three key questions and why did it take place so long, why are the checks and balances, and what are the repercussions. You know, the clawback certainly hurt, but i still think wells fargo could and should do more. Fire the head of the committee on the board in charge of human resources. Fire the head of the committee on the board in charge of customer relations. Go ahead and do a little bit more for the customers that were impacted and better define the culture. Hes made some attempts today, but better define why its still a great culture and how these crosssell mishaps could still happen. Does buffett hold the key here . There was a story written by doug cass saying among other things mr. Buffett had spoken to the board directly, he expressed his own satisfaction. Becky quick spoke to somebody directly in buffetts office and reported that news in the last half hour or so. Does buffett hold the key once in fact he does speak publicly . Well, as the largest shareholder certainly can sway things one way or another. Ive been talking to many of the largest Institutional Investors too, and some people say, you know, john stumpf has to throw a hail mary to survive. Other people say, well, maybe he can still make it. Id say as of this point, its a tossup. They have to come through with more, you know, repercussions for management and the board, i think, for him to survive. Mike, i appreciate the time. I know youre trying to catch a flight, but thanks for spending some time with us. Pete, what do you do here, wells fargo . Well, i think the difficult thing is whether we like it or not, whether its deserved or not, im in the camp that i think that hes probably under going to be looked at as somebody whos going to have to go, scott. This is nothing like the financial crisis. He has not put this company in jeopardy in terms of leveraging them like we had seen in the financial crisis. As a matter of fact, this was the name everybody pointed to, including Warren Buffett, as the clean bank. So is this black eye enough . Unfortunately, it might be because its turned into a bit of a witch hunt. If he goes, do you need to rethink the way you look at wells fargo as a company for all of the things it has done, the growth that its enjoyed, the image that it once had under stumpf . This puts a tarnish on the image, theres no doubt about it. But i think this is a small blemish relative to what the rest of the banks did. I think if you go back to the financial crisis. So for that answer, i think the interesting thing is does the stock go a little bit lower because of this and because of whats going on . It probably does. I think this is a lot different where we are a week later is a lot different than a week ago. Steve, how do you view this . Look, stumpf has done a great job. If you take a look lets go before this and i remember talking about this beforehand. If you take a look at any of the financial metrics and if you go back to 08, they were the best run bank, period. And the market gave them that multiple. What were seeing here in terms of whats being alleged and what they have admitted to is its disgraceful. Its a very large company. We see this kind of behavior in even the smallest company. However, whats really disgraceful is the way congress is doing it, just grandstanding in election season. That aside, i think stumpf should stay. We cant judge him on his performance which was less than optimum in front of Congress Last week. Im saying he should stay. So companies have a process. And the process stakes longer than how the media or congress would like it. So we havent let them go through that process. Think of all the ways it impacts the culture and impacts the bank. This is a small part of their business. I think if were done behind closed doors wed have a much different outcome, much different view. Lets view it through the prism of an investment decision. Stock is at 45 and pretty much hasnt budged throughout the day other than a little volume pickup during beckys report on what buffett was thinking according to someone in his office. At 45, can you buy the stock today . If stumpf loses his job, how much risk is in that number . Theres a bench behind him. I did the analysis on it. Theres a bench behind him. Its a culture. Its a culture that not one guy was running it. You can snicker if you want. I am snickering. You can look at a microcosm of it and that is it. The fact is they stayed out of europe, they stuck to their knitting. They run risk exceptionally well across all product lines. And by the way, they have had the only a Credit Rating, jpmorgan was a minus. Banks are too big, theyre all too big. Have we all lost our minds . This isnt obvious . This has to be explained . You have an organization this size with this percentage of the american publics deposits, with this percentage of the Customer Base, with this number of employees in offices doing all these things . Hold on, hold on. Different question. Lets say stumpf is a great executive and he should survive this because of the things steve mentioned and all true. At the end of the day it doesnt matter because the bank is too big and cant be managed. Jamie dimon is the best and that can go on under his nose. It may be too big to manage in your estimation. Is it too big to investment in . No, no, no, it is demonstrably too big to manage if upwards of 5,000 employees are implicated in whats essentially the largest, in my opinion the largest case of identity theft. Literally taking someones Social Security number and opening up now, youre not stealing from them, youre generating paperwork under their name. But at the end of the day if this can be overlooked, lets say its not stumpfs fault, lets say theres a culture. The bank is too big, theyre all too big. I dont think that any person, dimon, stumpf, can actually manage an organization of this size. I dont think that we should have Internet Companies either because yahoo was able to hide that massive fraud for so many years. To your point. Im not sure what were getting at here. I dont think yahoo is systemic financially. Scott, come back to your question. If something happens to stumpf, i think one of the issues is wells fargo investable today at 45. I would not be investable today for the reason that the perception right now is that the culture there, there is something wrong. If stumpf leaves, until somebody comes in to clean the house and bring new management in, youre going to have this perception that things can still go on, right . It wasnt just one or two people, there was thousands of this happening. Lets jump back to the hearing now. Theres congressman fitzpatrick questioning john stumpf. We have a nonretaliation policy on whistleblowers. Being fired in the federal government for being a whistleblower is a very serious matter. Hopefully youre taking it as seriously as anybody else would . Were taking that very seriously. We have a nonretaliation policy. Time of the gentleman has expired. The chair now recognizing the gentle lady from wisconsin, miss moore, Ranking Member of our Monetary Policy and trade subcommittee. Thank you so much, mr. Chairman. I want to welcome our witness here today. Ive learned so much here. I know when you go to the wells fargo website, there your picture is, john g. Stumpf. The vision and values of wells fargo. And it features you. You say that you started with wells fargo in 1981 . In 1982. 82. Okay. My math is not that good. And you you succeeded mr. Kovachevic. So you were trained and you knew what the culture of this nor west company, i guess that was the merger of wells fargo and norwest. And so did you receive training or do you know if the employees received training on this going for Great Program that weve talked about here today where, you know, most of your customers only had five accounts in your bank and that there was an effort to get at least eight sort of accounts for the customers . Was that part of the culture . Thank you for the question. As i mentioned before, that was an aspirational goal. Most of our customers had 14. I dont have much time. And so as your predecessor noted, there is just abundant Growth Potential in the wells fargo Customer Base and that one of the sayings around that place was, hey, we expect what we expect. So were there constant monitorings to see if people were meeting these goals . It says that we expect what we expect. What does that mean . We expect our people to live according to our vision, our values, our ethics and our culture. If they dont i am so happy. Im going to congratulate you on draining the swamp of these 5300 low level employees because they almost brought down one of the greatest companies that our country has ever known. I remember wells fargo, the old wagon train days. So im happy that you got rid of those employees. And i am sorry for your loss, your 41 million. And im sorry for the loss of the investors whose stock dropped. But i am wondering what the relief is for one of my constituents, and i have her letter and i want to enter it into the record. She worked at wells fargo without objection. Okay, thank you. And she started making 13 an hour and she ended making 15 an hour. She was one of those whistleblowers who complained to the manager and then they changed her performance numbers and pushed her out. And so shes a person that lost their job and other stuff that happens to you when you make 13 an hour. 15 an hour, im sorry. And youre pushed out by people because you dont want to because you dont fit in with the expectations and the culture. What is the remedy, is there a fund for these employees, the good ones, not these 5300, you know, what was it, 12 an hour, 13 an hour employees. What is the remedy for my constituent at wells fargo . We want to know about every one. And were going to review their files for anyone who had anything to do she has a case with wisconsin equal rights division. How come she couldnt just come to you and tell you and we have people that she can talk to. No, the people she talked to fired her. We have Corporate Resources here. If you could give me that name, congresswoman, let our people know let me ask a question. I have 49 seconds. I was very disturbed to hear about, you said that the numbers were just not large enough to rise to the level of being material for security law purposes. I guess i dont really i dont understand that. Would you as an investor invest in sort of the Bernie Madoff type enterprise this seems like it was, these huge dividends, would you make this kind of investment yourself . This is not any this is a Quality Company who made some mistakes, but our investment thesis is all about our capital, our growth, our revenue i just have nine seconds left and i want to ask this one question. You have stated that you think the doddfrank overregulates. Do you still believe that . Ive never said that. Oh, really . I dont recall saying that. The time has expired. Thank you mr. Chairman. Were going to jump away from washington, d. C. , once again and show you what continues to be a developing story, at least over the last 24 hours. That is on the righthand side of your screen now. That is the price of crude oil just breaking above 48. This coming yesterday really in the start after that agreement in algiers by opec to limit production. It sent oil prices sharply higher yesterday. They have just started moving higher yet again during this program, up now 2 . On that note lets bring in doug, the top ranked integrated oil analyst. He is on the phone with us today. Doug, welcome back. Hi, everybody. Do you believe in what happened in algiers yesterday . Well, somewhat. So lets clarify whats happened here because theres meaningful potential here. The first point is that, you know, opec has an understanding, which is not to be confused with an agreement, but if they hash out an agreement and reduce production by half a Million Barrels per day, then the implications can be pretty positive. The issue is that the devil is in the details. They havent yet determined production allocations, the direction of production response, the enforcement mechanism and these are the same hurdles and the reasons why opec has not had a functional supply arrangement since 2008. Simultaneously, the past few years of low oil prices have been very difficult for these countries and so theyre probably more motivated to deal today than ever. If they do deliver, then we think that inventories are going our projections for inventories decline by about a day in 2017 and lead to a Higher Oil Price for us from 55 to 60 in 17, so they have a lot at stake if they can get it right here. You have a buy on just about everything in your coverage list other than tesoro which is a hold. Whats the risk there . Whats the risk . Well, we do have a lot of buy ratings. We have been overweight, the group this year and were still overweight the group. The trying not to overthink the Investment Outlook for energy this year. We think were in