Who are we talking about, why of course your Morgan Stanley Wealth
Management Financial Adviser (MSWMFA) that is who.
Let see his or her compensation plan was just changed to
encourage him or her to increase revenue and allow him or her to buy discounted
stock in Morgan Stanley, it is structured as a forgivable loan in 5 years,
assuming that they are still employed at Morgan Stanley. Even better it is a pretty slick way for
Morgan Stanley management to keep the money in house.
He or she now will get a bonus of between 2 and 5 percent of
the new assets/revenues that he brings in provided he or she is in the top 40
percent. He or she is incentivized to
bring in more than $750,000.00 of revenue by reducing the by 2 percent the
bonus that is pay to all who brought in at least $750,000.00 in revenue. Something tells me that generating
$750,000.00 of revenue will not even get he or she close to being in that top 40
percent.
Morgan Stanley or more precisely the MSWMFA will be hunting
whales, and big dumb ones at that. I
wonder if they are white, wait that was another story?
If you are already a customer of MSWM stand by for a the
message from your MSWMFA that in all probability your assets are slightly
(completely?) allocated incorrectly (Wrong) and that if you want to hunt with
the big boys (more like be hunted by the big boys) you are going to have to
make some adjustments in your assets allocations (Completely gut your current
portfolio and try something completely new and totally different, how about
options, better yet how about naked options, how about using the stock that you
think that you already own, in reality it just a book entry, Morgan Stanley is
holder of record, as collateral, we can loan you the money, and our rates are competitive,
with every other brokerage house, how about credit default swaps, synthetic
derivatives). Surprise, surprise your
MSWMFA is just the one who is able to assist you in this effort (Commissions
and Fee oh goodie, how nice, thank you may I have another). But of course nothing in this world comes
free, and it will cost you a little in the form of commission, fees, and
possibly taxes to be paid, to reposition you for the coming new market (We are
going suck you dry if we get half a chance)(Is this the new normal?). You do want to be ready for the coming new
market? Of course you do.
These individuals are called Financial Advisors, not
Securities Brokers for a reason, and a great deal of that reason has to do with
how disputes are handled and who they are or are not reported to. This is very true when their advice is poor,
well remember you signed that agreement that says you cannot sue, no you must
use mediation, with their mediators (Good Luck with that).
Greg Fleming needs to keep his job, your MSWMFA needs to
keep their job, although I suspect that come this time next year there will be
less of them. They are ready willing and
able to keep their jobs even if they have to do it all at your expense. So be a good a sport and just give Morgan Stanley
your money (Do it for the children, Theirs).
They are people just trying to take make a buck.
The Morgan Stanley Corporation reminds me of the words of
the Giorgio Moroder song “Blood from a Stone” from the remake of Metropolis.
“Turning
for the wheels of gain. A system with a power of it's own, to draw blood from a
stone.”
In this case maybe the lyrics should be changed to “draw
blood from your stones”. You have been
advised of the situation, what happens next is totally up to you.
