Mr. Buffett: It's Time to Be Ruthless

"LOSE MONEY FOR THE FIRM AND I WILL BE UNDERSTANDING. LOSE A SHRED OF REPUTATION FOR THE FIRM, AND I WILL BE RUTHLESS." -Warren Buffett

Given Berkshire Hathaway's sizable stake in Wells Fargo, it is likely that Mr. Buffett is being rather calculating in terms of his reaction to the scandal, if there is going to be one. 

Ether way, Wells is sporting an ominous long-term chart now, especially compared to other large banks which have been slowly improving this summer. 

Still, the WFC scandal has likely lost a "shred" of reputation for Berkshire, given the manner in which Buffett talked up the bank for years on end as being one of the safer and more durable ones. 

WFC may be bouncing a bit today, but much like DB and its woes there could easily be more monsters lurking under the bed, particularly if Buffett imposes his will on the bank and compels them to shake things up from the top. 

On the updated monthly chart, below, the threat of the highlighted base breaking down is too much of a threat with more potential bad news out there.

Simply put, if The Fed comes out hawkish tomorrow and banks rally, I suspect there will be much better large and regional banks from which to choose, which means Wells ought to stay in the doghouse--At least until Buffett shows us he is the ruthless Buffett of old instead of a Buffett who just got old.