The Boss of Morgan Stanley comments concerning the Unfolding Banking catastrophe

The recent healthcare crisis has had cascading effects on the economy. The chief executive officer of one of the country’s leading financial institutions has offered a few choice words on the effect this is beginning to have in the banking industry. Less than two decades ago the world was rocked by the financial crisis that was precipitated out of the financial sector of the US due to dangerous investment decisions by commercial banks. Will the next few months look like a slow-motion replay of 2008 or something else this time around?

Crucial Statistics and Market Performance analytics in the Banking world

There has been an effect on more than only one banking institution and in more than one economic activity. This is the most prevalent disturbance that the system has seen since the Great Depression by some reports. At the starting of the year, banks throughout the world were regularly setting records on quarterly earnings and yearly profits. Today many banks are starting to question if there is a possibility they could lose solvency without government financial support.

Current Trading Activities are rather inspiring

This is the one bright spot in the market for banks right now. After some of the recent government intervention and the quantitative easing by the Federal Reserve, there has been a improvement to the stock values. The only major problem here is there is still quite some distance to go up before they return to earlier highs.

Wealth Management Activities are not as appealing as trading activities

Wealth management has grow to be an increasingly large part of many banking institution’s revenue streams over the last few decades. Morgan Stanley, for example, has stated roughly half of their yearly income comes from this department of their organization. This division also saw a decrease of nearly 8% in the last quarter in this area.

Fourteen percent decline in Investment Management activity is reason for concern

Today it is not only the wealthy who invest. More and more people from almost all socioeconomic classes have been able to access investments. This has generated a appreciable share of the revenue stream for Morgan Stanley roughly one quarter what their wealth management generated for the company. This division tumbled by 14 percent in the last quarter as well.

More information is available at CNBC and The Business Insider.

Leave a Reply