Morgan Stanley's Mack Sees End of (global credit) Crisis

[Omaha Steve]

Source: Associated Press

PURCHASE, N.Y. (AP) — Morgan Stanley Chief Executive John Mack said Tuesday that Wall Street is facing the most difficult conditions that he has seen in 40 years, but he feels the global credit crisis might be "in the final innings."

Mack, who easily won re-election to Morgan Stanley's board along with 10 other directors, said at the investment bank's annual meeting that he still plans to "go slow" because of the market's turbulence. The bank wrote down billions of dollars worth of securities linked to risky subprime mortgages and other debt since last year.

"We're keeping powder dry," he said. "We feel the risks on the market, the run on Bear Stearns, and we think it is important to have very liquid positions and we're working toward that."

He expects more bad news will come out as the world's banks recover from the subprime mortgage crisis, particularly from "overseas and some small retail banks in this country." However, Mack said he thinks the market is turning and that could provide opportunity.


Read more: http://money.excite.com/jsp/nw/nwdt_rt_top.jsp?news_id=ap-d8vtolco0&

[DJ13]

1. Most difficult, but over in the blink of an eye?

Why does that sound like wishful thing?
:eyes:

[Zynx]

8. It's been unusually rapid in its onset.

If you follow these things on a daily basis, you know how we went from "the incredible global liquidity story" at one moment with more money than people knew what to do with to a situation where we are all lamenting a "global liquidity crunch".

I personally think it will be about another year until lending truly loosens up.

[Earth_First]

2. Smells like an election year.... n/t

[cliss]

3. Don't count on it.

The Blogs I've been reading say that "by June" things could very well start unraveling.

These are industry "insiders", they are predicting that in another 3 months, it will simply be too difficult for the FED to hold things together. Nothing has been fixed. The FED is lending massive amounts to the banks, just so they can stay afloat. The problems are still there.

Up next: Lehman Brothers
Next after that: Morgan Stanley
Next: Citibank.

[Elspeth]

4. A realtor I know tells me it will take 18 months for the foreclosures to get out of the system

I think we're looking at a long recession.

[polpilot]

6. Florida has 28+ month supply. No union jobs, or middle class growth to drag us out of this one.

[Elspeth]

13. Jeez, what a mess.

..

[Zynx]

7. Blogs say a lot of things.

There have been rumors at one point or another about virtually every major bank being on the brink of failure and very few have. Barring a systemic run on the banks, I can't see how they fail in the fashion you suggest. Things are certainly awful, but hardly apocalyptic.

[Barrett808]

10. Morgan Stanley may go first

I read over at Nouriel Roubini's blog that Morgan's exposure to Level 3 junk is 250% of its equity base. So it may be in the worst position of all the investment banks.

Hence the "it's almost over" speech.

[ToughLuck]

5. WHY would anyone believe this man??

[roamer65]

9. Economist John Williams over at shadowstats.com sees...

a hyperinflationary depression as soon as 2010. He's been fairly accurate so far.

[merwin]

11. I prefer the term "final throes" over "final innings".

Much more suited to this administration and their followers

[struggle4progress]

12. He's saying bank failures are ahead