Morgan Stanley, WAMU... the feds to accept equities as collateral

[nadinbrzezinski]

I can almost bet the M3, not published no more, will be printing money like crazy

Ooohhh boy

[dkf]

1. Morgan Stanley now?

Since when did they jump into the fray?

[emilyg]

2. Link please.

For Morgan Stanley.

[d_b]

3. linky

[nadinbrzezinski]

4. CNBC on the teevee... listening to the program

if you got cable put it on

American analysis's, when interviewed, sound right down scared

[Journeyman]

6. Morgan Stanley, however, is listed as one of the 10 banks involved with establishing. . .

a $70 billion borrowing facility to bolster worldwide liquidity and reduce volatility in what they called an "extraordinary market environment.""

Each bank has committed to fund $7 billion for the collateralized facility, and any one of the 10 banks would be permitted to borrow up to one-third of the total facility, the banks said in a joint statement. The financing may grow "as other banks are permitted to join," they said.

The 10 banks are Bank of America Corp <BAC.N>, Barclays Plc <BARC.L>, Citigroup Inc <C.N>, Credit Suisse Group <CSGN.VX>, Deutsche Bank AG <DBKGn.DE>, Goldman Sachs Group Inc <GS.N>, JPMorgan Chase & Co <JPM.N>, Merrill Lynch & Co <MER.N>, Morgan Stanley <MS.N> and UBS AG <UBSN.VX>.

http://www.cnbc.com/id/26710030/for/cnbc/


So, as they are one of the White Knights in this article (published by CNBC about 3 hours ago), how can also be one of the Damsels in Distress?

[emilyg]

8. Thanks for the link.

[upi402]

5. link here, comcast article

http://www.comcast.net/articles/news-finance/20080915/BUSINESS-LEHMAN-FED-DC/

So by allowing equities, does that mean:

1) Banking equities - difference btwn amount a property could sell for vs claims against it?

2) Or is it equity financing - raising "money" by issuing shares of common or preferred stock?

3) Or is it meaning referring to a brokerage account - where stocks and bonds are worth more than the debits for a + balance?


I have no idea but I bailed on WaMu last week leaving just a few hundred for international fee-free transfers. Maybe I should grab that too. But I have a HELOC with WaMu too that I'd like to bid on somehow, should the debts go to bid (or whatever the hell happens) Help!

[Dover]

7. Bank consolidation in action (this is part of the plan in U.S. and abroad)

Actually it's been slowly moving in this direction for some time (economy of scales...global scales that is) with mergers, acquisitions, new laws allowing banks to expand their territory and their functions, but now I think we are in the cleanup stage. And the Feds have suggested that they should take over regulation of banks (to prevent such problem competitor banks from getting licensed, no doubt). Theory in nutshell - bigger fish for a bigger pond.

This is a relevant article, but from April of this year:


The credit crunch has claimed the once-mighty investment bank Bear Stearns & Co. Major commercial banks such as Wachovia and Washington Mutual are scrambling to raise capital.

But Colorado banks aren't immune. Most will feel the crunch sooner or later, even if they had no exposure to subprime mortgages, industry experts say.

"I think we'll see fewer banks," said Larry Martin, president of Bank Strategies LLC in Denver. "Some existing banks will sell, or be forced to sell, because they're stressed in terms of their portfolio composition and their asset quality. Or they may have older ownership that won't want to deal with the increased regulation that is coming."

It will become more difficult to start a new bank, he said.

"The cost of capital is going to be higher," Martin said. "And I think there will be higher expectations by the regulators in terms of their business plans, board composition and management experience."

In March, after the Federal Reserve backed JPMorgan Chase's plan to acquire Bear Stearns, U.S. Treasury Secretary Henry Paulson proposed sweeping changes in how financial services are regulated. It's too soon to say which proposals will be adopted, but it's safe to expect more regulation.

"Increasing regulation is one of the reasons why banks, particularly smaller banks, choose to sell out. It's just not worth the headache," said Wes Brown, a managing director at St. Charles Capital, an investment banking firm in Denver. Brown specializes in commercial bank mergers.

In the past six months, since the credit crunch began, Brown has seen an increase in the number of banks that are interested in being sold.

"There's a greater interest in selling, but fewer deals are being done", he said....

http://denver.bizjournals.com/denver/stories/2008/04/21/story3.html

[ChiciB1]

9. My IRA Is With Morgan Stanley... I Don't Have To Pay A 10% Penalty, But

I will have to pay taxes because it was "tax deferred" so should we pull our money out and put it in CD's or find something else.

I have NO IDEA about this kind of stuff, just know my money may be at stake and don't want to lose anymore!!!