Gorman said regulators in Washington need to begin “imbedding confidence” in the culture in order to really spur an overall economic recovery. Listen Bloomberg Originals Idea Generation: Nicole McLaughlin On this week's episode of Idea Generation, designer Nicole McLaughlin takes us on a journey from her start as a graphic design intern. … And we have to do all of this in a culture where patience isn’t highly regarded.”įrom the financial downturn, Gorman said he gleaned two very important lessons: Leverage is a “killer,” and “liquidity is essential.” “We need time to build capital and build buffers. “The whole system … needs some patience,” he said. Gorman said regulatory reform has left the financial services sector with a “galaxy of regulators.” He said he thinks the industry would be well-serviced by adopting a systemic regulator as the Dodd-Frank Bill has laid out.ĭespite the regulatory uncertainty and the economic malaise, Gorman said he remains confident even after the industry has gone through the “mother of all shocks and the mother of all regulatory reform.” Gorman, who made his comments during a 45 minute “interview” with Charlie Rose at a morning presentation that kicked off SIFMA's annual conference in New York, said regulatory reform, including the Dodd-Frank Bill and Basel III, have provided necessary “clarity about what a company can and can’t do” and are “essential” for an economic recovery. “Institutions should be allowed to fail no matter how big they are,” he said. Gorman, who became Morgan Stanley’s top executive in January, said he thinks financial services companies that get too large shouldn’t be able to rely on government assistance in order to survive. At the time Morgan Stanley announced the hire, The New York Times. Despite some industry trends, he said the company won’t be running credit cards, handling retail deposits or offering property and casualty insurance. Where appropriate, Morgan Stanley Smith Barney LLC has entered into arrangements with. He said it is not interested in being a full-service financial insitution. Gorman said Morgan Stanley is a firm in “constant transition” but expects it will remain focused on capital origination and distribution.
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