A week after Jim Willie claimed Morgan Stanley is experiencing liquidity concerns and their senior managers have been selling legacy stock positions, the Wall Street Journal reports today that in an agreement with Citigroup, Morgan Stanley will gain access to $48 billion in former Smith Barney brokerage deposits by 2015.
From the WSJ:
Citigroup and Morgan Stanley agreed to value their Morgan Stanley Smith Barney brokerage joint venture at $13.5 billion, handing a victory to Morgan Stanley following a months long dispute. The agreement paves the way for Morgan Stanley in coming years to take full ownership of the company at a favorable valuation, and could trigger a third-quarter writedown at Citigroup, which has carried the brokerage unit on its books at a higher value. Under the plan announced Tuesday, Morgan Stanley gets access to $48 billion in deposits by 2015.
Morgan Stanley appears to be attempting to gain access to liquidity. While we would certainly hope that segregated client theft at failed futures brokerages such as MF Global and PFG Best won’t leap to private stock accounts as predicted by Willie, are you willing to trust your blood, sweat, and tears with any major banking counter-party in the US when the SEC, CFTC, CME, and court systems have all proven that criminal fraud will not be prosecuted?
You must become your own central bank and hold your own physical assets in your own possession!!
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“the Wall Street Journal reports today that in an agreement with Citigroup, Morgan Stanley will gain access to $48 billion in former Smith Barney brokerage deposits by 2015.”
I am curious as to exactly what this means. Are not “brokerage deposits” the same thing as “client money”? If so, this does not belong to MS or any other brokerage or bank. It belongs to the clients who deposited it. Yes, this can be stolen but will it? Maybe. Why haven’t the former Smith Barney clients taken possession of their money? Is this a court ordered problem?
This appears to be yet another fine example of can kicking. Will the extra dollars on the JPM income statement really fool the public?
Well hell … who needs ‘QE’ when some fetid fedarale’ ‘judge’ tells you to pay your debts with your client’s assets!
Having proximity to these funds, even if they can’t be accessed until 2015, 2.25 years from now probably won’t prevent them from rehypothecating these funds from the moment the funds are in their hands. Like they said on South park; Aaaaand it’s gone!
They Just Don’t Get It!!! Keep The Lie Alive..
The stock market has turned into a back alley gambling hall. The games are rigged and the local cops are paid off to ignore the operation. Complaints fall on deaf ears and the house always wins.
Morgan Stanley has the right to get 48 billion? No! Just let Morgan Stanley go bankrupt just like Lehman Brothers since banks are a waste of time and capital.