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’You either love it or you hate it, Morgan Stanley edition
This Bloomberg Markets headline (koan?) attracted puzzlement on Monday:
Gorman Embracing Vegemite in New Wall Street’s 15% Bogey at Morgan Stanley
The anecdote behind the headline is just as off-the-wall:
Morgan Stanley’s most mysterious footnote — Part 2
In Part 1, we looked in and around Morgan Stanley’s mysterious little footnote about how the bank had reduced net exposure to Italy from $4.9bn to $1.5bn with a restructuring that settled in the early days of 2012.
Morgan Stanley’s most mysterious footnote — Part 1
(7) On December 22, 2011, the Company executed certain derivative restructuring amendments which settled on January 3, 2012. …
This mysterious little footnote announced to the world that in the fourth quarter,
How big could the Sarko trade go?
Some €15-45bn for Spanish banks and their government’s bonds at least, according to Morgan Stanley’s Huw Van Steenis, who has just produced a very interesting note on the carry trade du jour – or to use its technical name the ECB’s 3-year LTRO.
Equities, Japan and next decade
Morgan Stanley’s Graham Secker makes some interesting observations in his 2012 outlook report.
Chief among them is that the investment framework of the last 25 years is increasingly irrelevant and that Japan offers the best guide to what might happen in the equity market over the next decade.
European equities – trick or treat?
In keeping with the bearish mood this Monday morning, we present selected lowlights from the latest Graham Secker note.
Morgan Stanley’s European strategist has downgraded equities to “underweight” following the double-digit rally,
Understanding your central banker
If you can tell a little about someone from the books they read, you can tell a lot about them from the books they write, especially if they’re a central banker.
Morgan Stanley economist Spyros Andreopoulos has dipped into the library at the “Global Central Bank” and draws comfort from the number of “depression economics”
Papandreou plunge… or Corzine crash?
Then again, it is 1.11.11, or 11.1.11 for our American friends.
Financials taking a battering on Tuesday morning in New York (S&P 500 down 2.46 per cent at pixel time):
DPS vs. EPS
Dividends or earnings? Where should equity investors put their hope if Europe slides into a recession?
The former will likely outperform the latter, according to Morgan Stanley analyst Ronan Carr. He gives four reasons for this:
The trouble with central bankers…
Central banking and central bankers as we know them are out of touch with the modern world and ill-equipped to deal with the challenges set before them.
That is the view of Morgan Stanley’s Manoj Pradhan who argued that the current ‘DDD regime’,
The continuing mystery of US banks’ European exposure
Europe may or may not be saved but Q3 earnings releases by US banks suggest they’re content with their exposure to the continent.
We looked at the methodology behind exposure disclosure in this post.
Morgan Stanley’s Q3 “beats”, with a boost from “fluctuations”
Morgan Stanley beat analyst expectations with third quarter earnings Wednesday morning. FT Alphaville looks under the bonnet, but first, here’s the announcement (with our emphasis and including some choice footnotes ’cause that’s how we roll):
How one bank’s default is the same bank’s gain
JP Morgan came out on Thursday with a juicy $1.9bn gain from debit valuation adjustments (DVA) as a result of their widening credit spreads. This acted to offset some of the loss on credit valuation adjustments (CVA).
It’s going to be a miserable third quarter for banks, say banks
US bank reporting season is almost upon us and we’re looking forward to investigating the mysteries surrounding the performance of the bulge bracket since the turn of the year.
To give you a sense of how bad it’s been for the 1 per cent,
Goldman helps a frenemy in need
Can olive branches stem bleeding?
Goldman Sachs Options Research made a bold recommendation Friday to buy $16 calls on Morgan Stanley and to sell short-dated CDS. MS reports earnings on October 17 and Goldman argues that they will surprise on the upside,
Goldman predicts a fire sale of USD assets by French banks
There were a few cheeky titbits in an otherwise workmanlike Goldman Sachs note published Wednesday on US banks.
First up for a teasing: French banks. As we know, US banks are sitting ducklings in the middle of the European maelstrom.
The mystery of US banks’ European exposure
This might just be the most important piece of paper in US banking right now:
FFIEC 009 is the form US banks send to regulators about their exposure to Europe (sovereigns and corporates) and it provides the basis for many of the estimates of vulnerability.
CDS as omens of impending doom: starring Morgan Stanley
Sometimes CDS react violently to sudden events that were unpredictable. Sometimes they react to pure, unadulterated uncertainty and fear. And sometimes, just sometimes, CDS spreads are full of hot air.
James Gorman recommends some light reading
Today in cognitive dissonance, with a hat tip to the gang at Deal Journal:
October 3, 2011 To: All Employees From: James Gorman Subject: A Message from James Gorman
Over the past few weeks, there has been an enormous amount of confusion and misinformation about Morgan Stanley and others in our peer group.
Not even breaking even at Goldman Sachs
Credit Suisse bank analysts have gone one further than their Nomura counterparts by forecasting Goldman Sachs to register its second quarterly loss since going public in 1999.
It’s the second cut that the CS analysts have made to their estimates in a month.
Breaking even at Goldman Sachs
Thought the recent pick-up in trading volumes would be good news for the big investment and universal banks?
Think again.
Nomura’s US banks analyst Glenn Schorr has just taken the red pen to forecasts for the second time in a month.
Le Spleen de Morgan Stanley
All is not well in the kingdom of Stanley. The CDS spreads have blown out and the market is concerned. Very, very concerned. Moody’s Analytics is here to tell us all about why that is.
The first [concern] is the exposure of MS to European institutions and the second is the level of trading revenues in the third quarter.
Fannie and Freddie’s revenge — the details [updated]
– By John McDermott and Cardiff Garcia
The details of the US government’s attempted bank raid are coming in on Friday afternoon.
The Federal Housing Finance Agency has filed 17 lawsuits against banks operating in the US.
US government attempts bank raid
Friday promises to be an ugly day for US financials:
Stories in the New York Times the Wall Street Journal on Friday suggest that a grand mortgage settlement is farther away than ever and that banks — or at least one bank (guess which!) — are coming under increasing pressure to prepare for the worst.
The BBB recovery
An early morning helping of doom and gloom, courtesy of Morgan Stanley, which has cut its global growth forecast for 2011-12 by a full percentage point.
The bank – one of the more bearish houses on the Street – reckons the US and Europe are dangerously close to recession because of fiscal tightening and policy blunders,
Morgan Stanley and that downgrade
Morgan Stanley’s 10-Q statement – that’s a quarterly report for European readers – is getting plenty of attention on Monday.
Or rather, the section on risk factors is getting a lot of attention.
Now,
UK house price gloom
Via Morgan Stanley, which thinks prices will fall 10 per cent on a two-year view and leave Lloyds with a negative equity headache.
More in the usual place. * Forecasts contingent on 150bps rate rise by end 2012.
Microsoft and Skype, for and against
Microsoft’s agreed $8.5bn acquisition of Skype evokes shades of the frenzied dotcom bubble era and M&A tech mania: the deal, unveiled on Tuesday, brings this year’s total of announced tech deals to $94.5bn — a 56 per cent increase from last year – and also marks the highest levels of tech M&A activity since 2000,
Elkjøp – the new name for Dixons
Following its recent profits warning we mused on whether Dixons Retail should consider another re-branding.
One idea was to take on the name of its profitable Scandinavian operation, Elkjøp.
And it seems many a true word is spoken in jest.