To: All Employees From: James Gorman Subject: A Message from James Gorman (Deal Journal)
Over the past few weeks, there has been an enormous amount of confusion and misinformation about Morgan Stanley and others in our peer group. In fragile markets, where fear triumphs over common sense, these things are bound to happen. It is easy to try to respond to the rumor of the day, but that is not usually productive. Instead we should let balanced third parties do their own analysis and let the facts speak. To help you wade through the maze of numbers and information, it might be worth reading two analyst reports that were published this morning. One is from Howard Chen at Credit Suisse that examines Capital, Funding and Liquidity at Morgan Stanley and Goldman Sachs and, in some detail, highlights the dramatic improvement to our financial strength over the last three years. The other is from Matthew Burnell at Wells Fargo, who writes about Eurozone and Derivative exposure for the sector and plainly underscores that our exposure to the Eurozone and France in particular is not a concern. I encourage you to stay focused on your job, remember that we are a client-focused Firm and do what you need to do to help our clients navigate this turbulence. It is in times like these when our professionalism, market wisdom and client focus are truly valued.
Morgan Stanley May Raise $5 Billion In Japanese Bond Sale (BW)
Morgan Stanley said it may raise as much as 385 billion yen ($5 billion) by selling uridashi bonds to Japanese investors sometime in the next two years. The New York-based firm can sell bonds anytime between Oct. 12 this year and Oct. 11, 2013, according to a shelf registration filed to Japan��s Finance Ministry today. Uridashi bonds are debt issued outside of Japan for sale mainly to Japanese retail investors.
Deutsche Bank To Miss Targets (WSJ)
Deutsche Bank said it no longer expects to reach the targeted €10 billion ($13.18 billion) pretax profit from operating businesses this year, as uncertainty caused by the European sovereign-debt crisis ate into volumes and revenue in the third quarter, notably at the investment bank..."Nevertheless, the bank will be profitable in the third quarter and expects a robust earnings level for the full year 2011," Chief Executive Josef Ackermann told an investor conference in London, according to a company announcement.
UBS Sees Profit Despite Trading Scandal (WSJ)
Kweku Adoboli can't hold us down!
Wall Street Protester’s Missed Connection: ‘We Got Arrested On the Brooklyn Bridge’ (Gawker)
Cute anarchist(?) protestor arrested at Occupy Wall Street - m4w - 29 (90th precinct house, Williamsburg): I first spotted you at Zuccotti Park/Liberty Square right before the march started. You're a few years younger than me with short, dark hair and you were wearing all black with leggings and a red handkerchief around your neck. I thought you crushingly attractive but things got moving and I lost track of you before I was able to work up the nerve to say hello. I saw you again a couple hours later when we got arrested on the Brooklyn Bridge, and then we ended up in neighboring cells at the 90th precinct house in Williamsburg. I'm the tall guy with glasses and short, dark hair wearing jeans and a tan t-shirt. I had a gray hoodie with black stripes on the bridge. You made fun of my shoes' tongues falling out because they'd confiscated our shoelaces! Unfortunately you were released in the first group and I in the last, so I couldn't find you by the time I got out. Curses! I'll be looking for you hard the next time I'm down there, and I won't let the opportunity pass by me a 2nd time! But in case I don't see you, know that I'd love to buy you a coffee or tea or what-have-you (it's cold in that park!) and hear what draws you to the demonstration. Say hello!
Hedge Funds Pay Top Dollar For US Intelligence (WSJ)
Information about what's happening in Washington is at a premium on Wall Street these days. Government regulatory changes and economic initiatives following the 2008 financial crisis have affected numerous industries, and even minor shifts in policy can be of interest to hedge-fund managers. When the health-care bill was snaking its way through Congress in 2009, for example, hedge funds wanted to know about every twist and turn. They followed the debt-ceiling showdown over the summer just as closely. Keen for information about what's happening behind the scenes, hedge funds have been drilling ever deeper into the government. Thousands of political insiders are being paid by hedge funds, private-equity firms and other big investors. Former Federal Reserve Chairman Alan Greenspan, for example, is an adviser to Paulson & Co., and former Treasury Secretary John Snow works for Cerberus Capital Management. SAC Capital Advisors and Eton Park Capital Management have hired former congressional staffers.
Lacker Says Fed's Twist Won't Spur Jobs (Bloomberg)
“I tend to think it would cause higher inflation and have only a transitory or fleeting effect on growth,” Federal Reserve Bank of Richmond President Jeffrey Lacker said yesterday in response to audience questions after a speech in Madison, Wisconsin.
BofA Loses Leverage (NYP)
BofA has retreated in the pitched battle for leveraged loans until it can unload its loan backlog, according to two private-equity managers at different firms. “They’ve unequivocally become more conservative than others,” a PE manager said.
Protests Against Wall Street Spread Across US (AP)
In Manhattan on Monday, hundreds of protesters dressed as corporate zombies in white face paint lurched past the New York Stock Exchange clutching fistfuls of fake money. In Chicago, demonstrators pounded drums in the city's financial district. Others pitched tents or waved protest signs at passing cars in Boston, St. Louis, Kansas City, Mo., and Los Angeles.