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Morgan Stanley's Exposure To French Banks Is 60% Greater Than Its Market Cap... And More Than Half Its Book Value
With French banks now a daily highlight in the market's search for the next source of contagion, and big, multi-syllable words such as conservatorship and nationalization being thrown about with increasingly reckless abandon, perhaps it is time to consider the downstream effects of a French bank blow up. And we are not talking French sovereign troubles, which are about to get far worse with the country's CDS once again at record highs means the country's AAA rating is as good as gone. No: banks, as in those entities that are completely locked out from the dollar funding market, and which will be toppled following a few major redemption requests in native USD currency. Which in turn brings us to...Morgan Stanley, the little bank that everyone continues to ignore for assumptions of a pristine balance sheet and no mortgage exposure. Well, hopefully we can debunk one of these assumptions by presenting the bank's Cross-Border Outstandings, which "include cash, receivables, securities purchased under agreements to resell, securities borrowed and cash trading instruments but exclude derivative instruments and commitments. Securities purchased under agreements to resell and Securities borrowed are presented based on the domicile of the counterparty, without reduction for related securities collateral held." We'll leave it up to readers to find the relevant number.
The one thing we will highlight is that $39 billion is about 60% more than the bank's market cap and a whopping 65% (as in more than half) of its entire book (less non-controlling interests) equity value.
So if you are looking for a French bank implosion derivative play, look no more.
And naturally, it goes without saying, that adding across MS' entire European bank exposure is 3 times its market cap, and well over its entire book equity value.
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Is it me reading the charts wrong or have MS increased their French bank exposure from 9Billion in 2009 to 39billion in 2010??
Tell me I'm wrong please.
Reggie Middleton on Max Keiser discussing French banks, Greece, etc.
http://www.youtube.com/watch?v=ciGKW3oRJmI&feature=player_embedded
Ok I've been hinting at this for a long time, but now here it is spelled out:
US banks and certain French banks (and also certain nameless German and UK banks) are part of the biggest Ponzi ever. In essence, during the 'roaring aughts' (not!) they conspired to give the appearence of doing lots of business by engaging in trans Atantic selling and dealmaking back and forth to one another, pyramiding up derivatives to the 20th power as 'hedges' and collecting the corresponding fees, bonuses and under the table gifties.
What's about to be uncovered should be no surprise. The rabbit hole goes very very deep. What appears 'real' is anything but. Don't be fooled: Ask yourself: Would Madoff have been uncovered yet if he hadn't turned himslef in?
so why did he turn himself in......serious question
Probably because a cell is safer than walking the streets.
Maybe you don't get it: He ran out of money as 'investors' pulled money in the wake of Lehman. So he turned himslef in. The Ponzi imploded due to outside forces. But my question: would he have been uncovered without a market meltdown of epic proportion? He would probably still not only be in operation today, he probably would have had $500 billion under management due to his "impeccable record"!!! This should give you some idea what's been happening in these markets. And it should also tell you that other things that appear 'real' are still to be revealed.
prepare the pitch forks and lamps
yes now i understand what you are saying.....and yes i agree......thats the silver lining of a DEPRESSION , most if not all ponzis will be exposed
Bloodhound Gang - The Roof is on Fire
http://www.dailymotion.com/video/x235s_bloodhound-gang-the-roof-is-on-fire_music
LMFAO!!
"Morgan Stanley down over xx% on absolutely no news." - CNBS
full retard.
eat snails
moron stanley...
Good thing MS, along with GS, scored their deposit bankster license back in '08. Making them indefinately eligible for le TARP du jour.
PCLN has a higher market-cap than MS.... I don't even know what that means!...Please...Someone help me understand!!!
Wouldn't want to be the guy in charge of controls and foriegn purchases at MS...who in their right mind would quadruple exposure to ANY country from 9B to 39B in one year when QE2 was running out and the PIIGS were already smoldering...unbelievable balls on these guys which were probably made bigger after seeing the bailouts...Sure Ben, we can lend to France, no problem, how much? Not a problem, glad to help Ben and see you in East Hampton for drinks Friday right?
I look at it this way...they probably were told to by Bernanke....he can't outright bail them out....but if your friends do the dirty work and you say you will backstop them....all is good right..
Holy cripes! This sounds turrible...
For those invested in the TBTF's:
YTD:
GS -44%
JPM - 31%
MS - 53%
BAC - 54%
Edit: sorry....forgot Citi......-48%
Got my non perishables and shotguns lets do the damn thing.
Interesting numbers. I especially like the fact that Morgan Stanley is also exposed to Italy and Spain, though not as dramatically as to France. Of course, French banks are dramatically exposed to Italy and Spain. Hmmmm. Is this what they mean by contagion - er - gangrene. I think those French toes are turning black and I can see red streaks running clear up to 'le crotch'. Lord it will be satisfying to see all these 'houses' decay and die, perhaps beginning with MS but inevitably taking other big bad wolves down with them. Is it too much to hope that Goldman could have its lower extremeties amputated? Say, from the neck down?
Now I understand why Timmy the Geithner has begged us (Europeans) to DO SOMETHING!
He (unlike Reggie the Bull) knows that if the Euro banking system buys the farm the U.S. will have to swallow a piece of the shit sandwich...
They just came out and denied it...deny..deny...deny...
how the hell did you find this lol
"Hmmmm. Is this what they mean by contagion - er - gangrene"
Right! Another expression for this would be "domino theory". Things go apeshit in Paris and there's a bank-run in Washington NYC Dallas or Tokyo or Dubai...
Urggggh!
MORGAN STANLEY is not too big to fail - this and citi are not on the side of the angel
Morgan is done.
Thx TD. Missed this post during the day but loading MS puts in the AM. Hopefully I'm not too late
"Cross-Border Outstandings" is not the same as hard assets on a balance sheet. This remind me of last weeks article that said Austrian banks have a "multi trillion euro exposure" to "derivatives", which again was reported as if the exposure was an asset.
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