Who Is Morgan Stanley and Why Its $31 TRILLION in Derivatives Should Concern You

[Z_California]

From Wall Street On Parade: http://wallstreetonparade.com

Snip

"Last July Morgan Stanley reported that it now has 15,771 retail brokers. In its third quarter report for 2015 it reported that it had $404 billion in assets under management – that means how much it is managing of other people’s money, much of which are accounts for moms and pops, retirees and pension and retirement accounts."

"Could Morgan Stanley’s derivatives pose a problem for it? Why does the composite wisdom of the stock market view its stock value at 38 percent less than it was in July?"

Snip

"We emailed the SEC and inquired as to why it was allowing a bank holding millions of brokerage accounts for moms and pops across America to simultaneously be housing $31 trillion in derivatives. We received an email back from Judith Burns in the SEC’s Public Affairs office with this: “Decline comment, thanks.” "

"If you are counting on the SEC to have your back in the next crisis, our opinion is — don’t."

(edited to fix link)

Much more at the link. Not much has changed on Wall Street.

[whatthehey]

1. They hold 31T in derivatives like bookies are on the hook for billions every Superbowl

In other words not at all.

The whole point of derivatives is they are bets, with people holding both sides of that bet. You never have to pay out the full value of bets on both sides of a yes/no wager.

[Octafish]

5. Except now the US Taxpayer has to bail them out.

Too big to fail meets no Glass-Steagall.

[whatthehey]

6. They do? Got a link for that?

[Octafish]

7. Ever hear of Elizabeth Warren? How about William K. Black?

http://therealnews.com/t2/?option=com_content&task=view&id=31&Itemid=74&jumival=15097

[whatthehey]

9. Ever hear of the meaning of the word "could"?

I could win the lottery.

[Octafish]

12. You could. But when it comes to Glass-Steagall, you don't.

Which was the point. If you want to predict stuff, here's what I wrote in February 28, 2008 regarding the S&L crisis:

Know your BFEE: They Looted Your Nation’s S&Ls for Power and Profit

Then, after the Bankstershitstorm in September 21, 2008, I asked them who stole it to put it back:

Know your BFEE: Phil Gramm, the Meyer Lansky of the War Party, Set-Up the Biggest Bank Heist Ever.

What's weird is how, rather than the jail cell he so richly deserved, Phil Gramm ended up as Vice Chairman of UBS -- the Swiss Bank that received about $59 Billion with a Billion in TARP funds -- from where Gramm hired Bill Clinton, who signed into law the repeal of Glass Steagall. Since then, they've also brought in George W Bush to specialize in Wealth Management:

Funny. I don't see any replies from you back then, whatthehey. And I don't see much information now from you. Or links.

[whatthehey]

13. So why did you use the present tense declarative "has"

Ther is no need to bail them out now and you have shown none. There will NEVER, guaranteed, be a need for 31T derivative bailouts for them. That's exactly the same as saying all bets for and against a given outcome could come due.

[Octafish]

16. Right. Got a link for any of that?

As for the CROMNIBUS bill:

http://www.salon.com/2014/12/16/inside_wall_streets_new_heist_how_big_banks_exploited_a_broken_democratic_caucus/

Wait until the oil derivatives go through the floor. Thanks to people like you who float the idea that US taxpayers are not on the hook, they may not even notice.

[whatthehey]

17. Any of WHAT? Your own claim in black and white or derivatives 101?

[Octafish]

18. A link to back up your claims.

You wrote:

"They hold 31T in derivatives like bookies are on the hook for billions every Superbowl"

In each of your posts above, each statement is your word, which is nice, but it's your opinion.

So, what evidence do you have to support your contention, in particular that the derivatives are not the US taxpayer's concern?

[Z_California]

8. Bookies aren't their own biggest customers

Bookies usually win no matter which side of the bet pays, because they're just making the vig and equalizing the amount on either side (Usually. Sometimes they lose big). They don't gamble in their own market (the ones who stay in business anyway).

The banks have a stake in the eventual outcome unlike bookies. And when they lose, they don't pay. We do.

http://www.zerohedge.com/news/2015-10-06/derivatives-market-bets-bookies-and-fraud

[whatthehey]

10. The scare bullshit numbers however are equally applicable

If banks bet against their own loans they either get the loans repaid or "win" the bet on the default derivative. This is simple hedging. It's literally impossible for them to lose all derivative swaps.

[Z_California]

11. You should read the last link I posted

You don't need to lose 0/100 to cause a meltdown when the pool is $31 trillion. The wrong side of a 48/52 stake of $31 trillion is $1.2 trillion. Total assets are $400 billion. Who pays those bets off when things go wrong? How much are banksters putting into their own individual pockets in the meantime while they manipulate the markets before the next crash?

This scam is going to ruin a lot more lives before it's over.

[whatthehey]

14. I'm not a fan of derivatives and default swaps. I'm a fan of accuracy

The silly sensationalism of the numbers used to discuss derivatives makes perfectly valid arguments against them look less credible.

[LanternWaste]

15. Unless of course, for every $1 of equity, a financial institution's fund is leveraged with $32 of lo

"They hold 31T in derivatives like bookies are on the hook for billions every Superbowl. In other words not at all."

Unless of course, for every $1 of equity, a financial institution's fund is leveraged with $32 of loans, which then swamps the derivatives. Which is not uncommon.

I'm not confident you actually have the knowledge or experience to speak of this, beyond bumper-stickers, of course.

[Wellstone ruled]

2. Look no further than the Gang that brought you this beauty.

Grahman--Leach-Blyley,with the help of Larry Summers and Robert Rubin,forget the name of the Guy who signed this thing and how it passed on voice votes and other special rules.

[dixiegrrrrl]

3. and where are the other banks holding THEIR derivatives.

The FDIC is supposed to cover the cost of banks future bets during the next ( soon to come) crash
read: bail-ins.

[Faux pas]

4. Kick!!!

[Nuclear Unicorn]

19. $31.00 in derivatives would be $30.00 poorly invested.