Posted by guest , Oct 09, 2008 11:21AM

Psst...I heard that there is trouble in the financial sector and some banks *may* have writedowns. Maybe that is causing MS stock to sink?

Posted by guest , Oct 09, 2008 11:22AM

Short ban lifted.

Posted by guest , Oct 09, 2008 11:22AM

Everything's good with MS. Now support your fellow traders.

http://www.cafepress.com/IShortYouNot

Posted by guest , Oct 09, 2008 11:27AM

Timing of share price collapse cld not be better -- by all accounts snr mgt from both Mitsu & MS are having a welcoming meet & greet tonight...

Posted by guest , Oct 09, 2008 11:28AM

shorts trying to drive the price down far enough that Mitsu reconsiders investment validating the lower price. not gonna happen

Posted by guest , Oct 09, 2008 11:30AM

The Japanese are finding ways to wriggle themselves out of this mess.

Posted by guest , Oct 09, 2008 11:31AM

they don't wriggle, they kamikaze you

Posted by guest , Oct 09, 2008 11:32AM

What would Benjaman Graham say?

Posted by guest , Oct 09, 2008 11:33AM

They're killing us and we don't have a fuckin' chance and that's not fair.

-Saving Private Ryan quote

Posted by guest , Oct 09, 2008 11:36AM

Ted Spread at all time high now 4.1%

I heard there's a lot of dead Niedehoffers this week. 7 straight down days. Yeah. They bet big and they lost big.

Shiiiitt.... baby nidehoffers.

Posted by guest , Oct 09, 2008 11:38AM

Nouriel Roubini continues to predict that Morgan is toast, and the firm is fighting a "rumor a minute."

Posted by guest , Oct 09, 2008 11:38AM

MS may go down as the best deal going forward.

By the way, WTF is up with the metals (X, ACH, AKS) all trading at absurdly low levels??? They have to be worth something more even with a seriously more conservative growth expectation.

Posted by guest , Oct 09, 2008 11:39AM

Roubini is a moron.

Posted by guest , Oct 09, 2008 11:42AM

The story below was taken directly from FT Alphaville:

The Mack doth protest too much… as Morgan Stanley watches the spreads on its credit default swaps climb and tries to stem the flow of clients from its prime brokerage services, John Mack has stepped up his efforts to reassure the world – and particularly Mitsubishi UFJ Group – that his bank is sound.

Ahead of Tuesday’s confirmation that MUFG’s agreement to invest $9bn in Morgan Stanley remained on track, the Fed invoked “unusual and exigent” market circumstances at the weekend to speed up approval of the deal.

When speculation spread Tuesday that MUFG might back out of its commitment, Mack jumped on the phone, telling clients the deal was on course, reports the Wall Street Journal. A memo he sent to the Morgan Stanley’s 46,000 employees decried “the extreme volatility” of “a rumor-a-minute environment.” And MUFG issued a separate denial, reiterating that the deal is expected to close Tuesday.

Lucky Mack. If he was dealing with a big bank from any other country, we couldn’t guarantee such impeccable behaviour from a prospective buyer up to now. But we’re sure he’s sweating.

On Thursday night he hosts a very important dinner in London for top executives of MUFG, according to the Wall Street Journal. We can just imagine the dinner conversation:

“So Mr Mack, your share price and CDS spreads don’t necessarily seem to be - err, going in your favour…could you pass the salt please…”

Morgan Stanley’s share price dropped 25 per cent on Tuesday after plunging 40 per cent earlier in the day, and fell a further 5 per cent on Wednesday - the stock’s lowest closing price in 10 years, with the shares down 68 per cent so far this year.

Spreads on Morgan Stanly credit default swaps meanwhile ticked back up above 21 per cent on Thursday after Market Watch noted Wednesday that its spreads were trading at 19.5 per cent upfront, according to Phoenix Partners Group, down from 20 per cent upfront Tuesday, but still at distressed levels. By comparison, Morgan Stanley CDS spreads in mid-September were less than 600bp above Treasury bond yields.

Mack, who took over as chief executive of the Wall Street firm in 2005, on Wednesday went on another round of PR to convince shareholders, trading partners and employees not to believe the latest round of doom scenarios swirling around the firm.

In a staff meeting in London on Wednesday, one employee asked Mack about the surging CDSs. He told the crowd that it was a “temporary” phenomenon that should dissipate once credit markets return to more normal conditions, according to the Journal.

He added that some traders have been buying default protection as another way to bet against the company’s prospects, while the temporary ban on short selling has been in place.

But another reason for Mack’s undoubted nervousness is the prospect of a “short-sellers’ revenge” as the ban is set to be lifted Thursday. This has yet to materialise however, with the stock up 1.9 per cent as of 9:05 a.m. in New York.

Most worryingly for Mack is that Morgan Stanley - once one of the world’s top prime brokers and now one of the only two remaining US broker/dealers alongside Goldman Sachs, has been bleeding clients from its prime brokerage services, as the FT said last month. The rush out the door by hedge funds and others has accelerated in recent days, according to investors. Among the beneficiaries has been Deutsche Bank.

To be fair, as the Journal noted:

Morgan Stanley is well-capitalised enough to fund itself through the third quarter of 2009 without raising new long-term debt, wrote Bernstein Research analyst Brad Hintz in a recent report. For now though, the debt issuance market is effectively ‘closed to the company,’ he added. Glenn Schorr, an analyst with UBS, said the company’s position would improve if it is able to agree to a ’sizable’ credit facility from Mitsubishi UFJ.

One final point, and we’re not suggesting the two are related in any way, but it’s worth noting reports that the US Treasury seems to be moving to adopt a new plan to take direct stakes in troubled banks - just as Morgan Stanley’s woes seem to be deepening, very rapidly.

Posted by guest , Oct 09, 2008 11:42AM

@16

A moron who has been right consistently all the way.

Posted by guest , Oct 09, 2008 11:47AM

Beard & Bald just announced that there is nothing to worry about, the crisis is "contained."

Posted by guest , Oct 09, 2008 12:33PM

@17 too long didn't read

Posted by guest , Oct 09, 2008 12:35PM

In the opinion of this seasoned observer, John J. Mack, the crooked, greed-driven, SEC-evading piece of human refuse now running Morgan Stanley should do MS shareholders a HUGE favor and promptly resign.

Mack is clearly a blithering elitist, and anyone who's taken the time to review all the Congressional testimony in the Gary Aguirre-Pequot Capital Management-GE-Heller Financial-Mack insider-info investigation should know this!

John Q Public is fed up with well-connected scum bags like Mack who think they are above the law. If Americans have their way, Mack will be stripped of all his ill-gotten wealth and jailed - and for the sake of the markets, Mack’s ruination should be very well publicized.

Then and only then will much-needed confidence and integrity finally be restored to the rightfully sagging US equity markets.

And hey; IMO Jim Cramer would be a great cell mate for Mack!

Sparky

Posted by guest , Oct 09, 2008 12:38PM

Sparky - go back to your Y2K bunker.

Thanks in advance.

Posted by guest , Oct 09, 2008 1:08PM

MS will survive, even if for no reason other than if MS went under, GS is next to go

Posted by guest , Oct 09, 2008 2:03PM

@17...dude, please. Keep it terse.

@23. Agreed. Lehman failure is roadmap for what they won't let happen again. MS, then GS go down...not going to happen because of counterparty issues and blow to systemic confidence.

Posted by guest , Oct 09, 2008 2:37PM

@23 and 24 - Agreed also. In retrospect, the biggest mistake was to let Lehamn fail. The reality is the market hadn't priced in the real consequences of the firm failing. They won't let that happen again. MS will have a tough fight, but it won't fail.