Skip to main content


Morgan Stanley Needs Better Fung Shui

We have Citigroup being carved up for Asian owners, then it was Bear Stearns, followed by UBS, and now Morgan Stanley. This wave would gain momentum and we should see even more financial giants having a rich Asian sovereign wealth fund or cash rich Asian company as a substantial shareholder - the new affirmative action policy?? Financial giants are sought after because of their global footprint and ease with leverage. Plus it brings the shareholders access to "certain unique technology, up to date financial innovations" thus bringing them access to global best practice in possibly the most influential sector in the business world.

Morgan Stanley shares closed up US$2.01 at US$50.08 on the New York Stock Exchange, even as Morgan Stanley executives offered a sobering outlook and warned that its credit and mortgage business would slow.The bank would suspend buybacks as it reviews its capital levels and investment plans. Mergers and leveraged buyout activity also is expected to slow. The slowdown in some businesses means Morgan Stanley, which announced 900 layoffs in recent weeks, may cut more jobs and shift resources to other, faster-growing areas.

The newly set up China's sovereign wealth fund, CIC, has snapped up a $US5 billion stake in Morgan Stanley, one of America's biggest investment banks. China Investment Corporation (CIC) would gain around a 9.9% shareholding in the storied US bank and securities firm which announced a net loss of US$3.59 billion for its fourth quarter.

CIC grabbed a US$3 billion stake in the Blackstone Group, a large private equity firm, earlier this year and China's CITIC Securities Co Ltd bought a 6% shareholding in Bear Stears for US$1 billion in October.

Morgan Stanley's quarterly loss amounted to US$3.61 per share compared with the same period a year earlier. The bank also reported negative quarterly revenues of US$450 million compared with US$7.85 billion. Last month, Morgan Stanley said traders betting the bank's own capital had incurred US$3.7 billion in losses on U.S. subprime mortgages. On Wednesday, the bank disclosed another US$5.7 billion in write-downs, reflecting further declines in the mortgage trades and losses on other debt. To restore its capital, Morgan agreed to sell equity units that pay a 9 percent coupon. China will be a passive investor.

Comments

Boon said…
Hello Dali!

This is Boon. I hope you are doing fine. Just to leave a note saying that I will be closing my Trade Bursa Malaysia blog soon. I am not very interested in stocks these days and had been selling a US recession story just before and when the DJIA made the peak at around 14100. I don't quite see myself talking about stocks in 2008. Therefore, is time for me to move on. Might start a new blog though. Currently, my fund is mainly allocated to FX and commodities.

I am already back in the UK from China but will remain in holiday mood. You know, Christmas is coming, and Christmas is a big thing here in the UK.

Keep up the good work. Merry Christmas + Happy New Year!

Best wishes
Boon
Salvatore_Dali said…
Boon,

Good luck in yr ventures, I am certain u will be successful. Well, the biz blogs are getting less n less with Seng also leaving his Fusion Investor. Good luck.

Dali

Popular posts from this blog

My Master, A National Treasure

REPOST:  Its been more than two years since I posted on my sifu. This is probably the most significant posting I had done thus far that does not involve business or politics. My circle of close friends and business colleagues have benefited significantly from his treatment.


My Master, Dr. Law Chin Han (from my iPhone)

Where shall I start? OK, just based on real life experiences of those who are close to me. The entire Tong family (Bukit Kiara Properties) absolutely swear that he is the master of masters when it comes to acupuncture (and dentistry as well). To me, you can probably find many great dentists, but to find a real Master in acupuncture, thats a whole different ballgame.


I am not big aficionado of Chinese medicine or acupuncture initially. I guess you have to go through the whole shebang to appreciate the real life changing effects from a master.


My business partner and very close friend went to him after 15 years of persistent gout problem, he will get his heavy attacks at least…

PUC - An Assessment

PUC has tried to reinvent itself following the untimely passing of its founder last year. His younger brother, who was highly successful in his own right, was running Pictureworks in a number of countries in Asia.

The Shares Price Rise & Possible Catalysts

Share price has broken its all time high comfortably. The rise has been steady and not at all volatile, accompanied by steady volume, which would indicate longer term investors and some funds already accumulating nd not selling back to the market.


Potential Catalyst #1

The just launched Presto app. Tried it and went to the briefing. Its a game changer for PUC for sure. They have already indicated that the e-wallet will be launched only in 1Q2018. Now what is Presto, why Presto. Its very much like Lazada or eBay or Alibaba. Lazada is a platform for retailers to sell, full stop. eBay is more for the personal one man operations. Alibaba is more for wholesalers and distributors.

Presto links retailers/f&b/services originators with en…

How Long Will The Bull Lasts For Malaysia

Are we in a bull run? Of course we are. Not to labour the point but I highlighted the start of the bull run back in January this year... and got a lot of naysayers but never mind:






























p/s: needless to say, this is Jing Tian ... beautiful face and a certain kind of freshness in her looks and acting career thus far



http://malaysiafinance.blogspot.my/2016/12/bank-negara-may-have-switched-on-bull.html


I would like to extend my prediction that the bull run for Bursa stocks should continue to run well till the end of the year. What we are seeing for the past 3 weeks was a general lull where volume suddenly shrunk but the general trend is still intact. My reasons for saying so:

a) the overall equity markets globally will be supported by a benign recovery complemented by a timid approach to raising rates by most central banks

b) thanks to a drastic bear run for most commodities, and to a lesser extent some oil & gas players, the undertone for "cost of materials" have been weak and has pr…