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Morgan Stanley Message Board

  • danny.draper danny.draper Sep 22, 2008 12:06 AM Flag

    MS and the market this week

    I have been reading alot this evening and a few things have caught my attention:

    1)Both presidential candidates came out today against the bailout plan in its present form. This move has given legislators on both sides of the aisle the "OK" to express reservations with the Pauson plan. Look for executive compensation to be severely limited for any company accepting the bailout. And many have said the are interested in saving companies buy not protecting investors. If we see a plan this week it will be much different than what Paulson proposed.

    2) Not too sure that GS and MS will pop much on the news they are now regular banks. WSJ says more regulation and less profitability. Being a bank now doesn't make it assets any better. And I think they are admitting they were close to meltdown. Lots of banks with bad loans trading in the single digits.

    3) According to the Financial Times, in BK court Friday Lehman Bros admitted the true value of their mortgage assets was closer to 47 billion rather than the 70+ billion they showed on the books. As this unravels, we may find Lehman had a negative value of 100+ billion.

    4) Market is still very nervous. Watching the Congress fight over the bailout plan won't help. The longer it drags out, the more investors will bail, especially in light of the fact shareholder equity will probably take a backseat to the govts claims against its loans. The markets party atmosphere will turn sober when it realizes Wall Street will not be handed a blank check for $700 billion for their friend Hank Paulson to spend as he pleases without oversight, as it should be.

    5) People are pissed over the bailout and are questioning the need to rush into this right before the presidential election. I'm a diehard Republican, but don't be surprised to see Obama leading the Dems in Congress in a plan that will not resemble anything like what Paulson proposed. If he's smart he will realize how unpopular this idea is with the Americans on Main Steeet and offer up some more popular ideas. It would certainly seal his victory, in my opinion.

    Did I forget anything?

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    • lost this battle, buddy boy..

      that's ok....

      I think you are a good guy, but you are wrong about the good things that Goldman and

      Morgan Stanley do for this country.....

      they do alot more good than 'bad' in the big scheme of things...

      You sound like a Repub Populist......

      that's OK....

      but remember that the world is a big place and there were alot of Repub Populists

      that didn't want to get involved in WWII and they were DEAD WRONG....alot of Demo

      Populist too for that matter.....


    • I agree, and making them a commercial bank does not mean they will have an instant deposit base. But what shocks me most is that even though Paulson extracts 80% of the ownership, people are still buying up these stocks (MS and GS). From what I can predict, Paulson is trying to save them just enough so they survive. He is not gonna give them enough taxpayer dollars for their stock and stock options skyrocket - as the stocks are doing now

    • missed the fact that the Asian markets are up anywhere from 2% to 4%...

      you missed the fact that we are now getting a REAL "RTC" type of program (TARP)

      to be passed this week to get this crap out of our credit system.....(not to say

      that four years from now the Govt will be able to sell this paper at a big profit)

      you missed the fact that oil prices have come down dramatically over the past week..

      you missed the fact our troops in Iraq are starting to come home now and within a

      year we will be largely out of that arena....

      MY GAWD......

      why don't you give a balanced picture ever?????


      what happened to you in your childhood?????


    • No you are right on target. I "chat" with a lot of people every day ~~Most just your average investor. I am amazed on how they got up to speed on what the real problem was ~~ Giving mortgages to those who didn't qualify. Years ago when I mentioned naked short selling I just got a dumb look ~~ I chatted with a security guard tonight on my way out. He was up to speed on naked short selling ~~I was amazed. I will tell you this ~ Joe Six Pack is pezzed off ! He knows that the Democrats like the Dodds & Pelosi's are most of the problem. Look at the handouts Dodd received from Freddie, Fannie, Lehman, Hedges etc ~~ This Senator is amazing. He is running his own Investment Bank out of Congress ~~ selling the country out!!

    • If the democrats make this bailout very stringent on the CEOs to make sure they do not profit from this robbery poised on taxpayers heads and also protect the taxpayers by requiring shares be issued then, they have my vote! Obama will win by a landslide! Bush and other Republicans have betrayed conservative principles again! Payback time in 2 months!

      • 1 Reply to matipid
      • From the Washington Post story titled "Democrats Seek Bailout Restraints:"

        Though lawmakers had promised to work across party lines and between chambers to speed the rescue plan to passage by Friday, that process was not working smoothly.

        Congressional Democrats considering the Bush administration's emergency plan to shore up the U.S. financial system yesterday countered with their own demands, presenting draft legislation giving the government power to cut salaries of chief executives at firms that participate in the bailout and slash severance packages for their top management.

        And Senate Democrats yesterday were still assembling a list of provisions they hope to add, including new powers for bankruptcy judges to modify mortgages on primary residences, an idea House Democrats said yesterday that they had abandoned.

        ++The article is 3 pages. Paulson called attempts to limit salaries a "poison pill." Looks like if they will have to swallow it if they want the loans.

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