Dick Bové Was The First Person James Gorman Called Yesterday To Say Nothing Is Fucked At Morgan Stanley

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Morgan Stanley executives say the firm is in far better shape than it was three years ago when it needed government bailout money to survive. But that didn’t stop chief executive James Gorman from taking the unusual step yesterday of calling analysts to quash an ugly rumor that Morgan faced huge losses because of its massive exposure to faltering European banks. He then ordered his traders to buy the firm’s own debt in the market to underscore the firm’s financial strength, the FOX Business Network has learned...The CEO told Bove that Morgan’s “net exposure” to French banks was “zero.” Gorman also said that while there may be a “run on the stock,” there is no “run on the bank” at Morgan Stanley, as there was in 2008, with large investors yanking money out of the firm’s prime brokerage accounts because they were afraid it might not survive. He confirmed that the firm was in the market buying its own debt to show skittish investors that it had enough cash and liquidity to survive not just the European banking crisis, but the rumors of its own pending demise, which began with a blog posting.

“I called up Bove and said, 'You’re a smart guy, here are the facts,'” Gorman told the FOX Business Network.

[FBN]

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