Talking With A Morgan Stanley Lawyer About the Economy and IndyMac. Response: No Big deal.

Just got off the phone with a Morgan Stanley trust lawyer. At least that is what I believe him to be as I am not sure of his exact position within Morgan Stanley.

I asked him about the fall of IndyMac and in what way that would affect Morgan Stanley and the economy as a whole. I also inquired as to why he thought the price of gold is so high, and why the FED is keeping the interest rates so low.

Now, if I remember correctly, he said (in general) the fall of IndyMac is really not that big a deal. It would have no affect on Morgan Stanley or anyone else for that matter, except the people who held some kind of vested interest in the company i.e. stocks and bonds.

When I talked about the high price of gold, he said that is more of an "older" way of thinking and when the stock market shows signs of volatility then much of the older crowd would go with 'gold'. I am not putting his words exactly, but basically his dimeanor was one of no real concern or any type of fear. He also went on to say (which I thought he had a good point, although I am still inclined to buy into gold) that if the U.S. economy actually crashed who would be around to buy the gold? And who would be willing to stick their neck out to sell the Gold? Though tI would point that out.

If some kind of crash occurred, I think the answer to this is when things settle down which, imo, would have to happen eventually, gold may be the way to get back on your feet. Just my lowely, uneducated opinion.

He did go on to say that if Morgan Stanley fell then you might as well as head to the mountains with a bag of canned food, guns and plenty of ammo. But he didnt sound like these were his plany anytime soon.

He also said the problems we are seeing now (with all the banks) are because of the lenders lending money on such high prices of housing, and now that the prices are falling a large liquidity issue has arisin. I could not translate that into lehman terms, but it seems basically they are just out of cash because people can not pay their outrageous arm and balloon payments.

I went on to ask him about the Fed not rising the interest rates (which from what I understand is the thing to do in this situation). His response was (again, not verbatim) "it is for businesses mostly, to keep the lending and borrowing of money flowing, not really for the average homeowner as lending practices have tightened and will continue to tighten. Again, I am not quoting him verbatim, but this was his general consensus.

I am posting this because of all the 'hooplah' going around here lately about the whole IndyMac failure. It seems from my point of viewm (listening to this guy talk) it just really is not that big of a deal in the realm of 'big business'. I don't have any education in economics, but maybe some people are making to big a deal about it?

Any thoughts?






[edit on 14-7-2008 by abelievingskeptic]

[edit on 14-7-2008 by abelievingskeptic]

As you can see, on ATS, people don't care about threads that prove their conspiracies wrong. Only about the ones where ignorance flourishes. Haven't you noticed that yet?

I applaud your post.

Big business is going down. Big dominoes in a domino-effect trickling-down our way. You can be certain, my prediction of total financial armageddon by November 1, 2008 will happen.

There's always consensus reality on both sides. I comes down to your own research and what you beleive. Being prepared is easy. When it's done it's buisness as usual. If the day comes it's will be us telling the naysayers to
PULL YOURSELF TOGETHER MAN Along with the doom and gloom side of this issue it's mostly a disscussion of an obvious policy change thats required within the system. So do your own research and don't listen to lawyers.

He sounds like he knows what he's talking about. I always thought that about gold, as well. It really doesn't do any good unless you can find someone to buy it back, or trade for goods in the case of a sitX. And in that case, who would trade food for gold? Not me.

I thought that the gold standard was abandoned in the '70's. I'm posting this more as a question, really, so that hopefully someone who pays better attention than me can help clear that up for me.

I have heard valid arguments for both bringing the gold standard back and for abandoning it all together, but if I understand the poster correctly, then it is still in use, just not as prevalent.

reply to post by Alora


No, neither Canada nor the US are on the gold standard. He is just talking about gold as an alternative investment to stocks.

He makes the point that if the economy crashes, who is going to buy the gold back from you? Nothing about gold standard, which is when a country's money supply is backed by hordes of gold and silver.

Originally posted by TheComte
reply to post by Alora

 

No, neither Canada nor the US are on the gold standard. He is just talking about gold as an alternative investment to stocks.

He makes the point that if the economy crashes, who is going to buy the gold back from you? Nothing about gold standard, which is when a country's money supply is backed by hordes of gold and silver.

Ah- ok. Thanks for helping me.

I, personally, don't think it will go that way. I think the government will look to other countries to bail us out again before we go the gold route, at least on a large scale.

But what do I know?

Welll first of all, he is a Lawyer, not a Financial Analyst or Accountant who has spent just as many years in school learning about Finances and Economics.

If you buy gold and the economy crashes who will buy it from you? People will trade you food if they can spare it. Wealthy people will still try to own it because economies always come back and who makes the rules? The guys with the most gold. IF the economy crashes to such a point as there is financial armageddon then Gold and Silver and Trading of items for survival items will be done much as drug deals are done today.

The Gold Standard was removed as the basis for the United States Economy years ago, but it still has value with just about every other country on this planet. If you remember the movie Die Hard 2, it took place in New York City with a large vault full of gold? Well those vaults exist deep under NYC and are repositories for the gold of many countries and individuals.

Reply to Mad_Hatter

I applaud your post.

Thank you for that. I understand what you are saying, but I am not
posting this to disprove a conspiracy or anything like that. I posted
this in earnest as to my real concerns about what I have been reading
about the economy and the problems that America may face in the near
future. I think what I have taken from the conversation is the
ability to look at the current situation for what it is. And it may not
be beyond saving or even, quite honestly, that bad... yet.

That does not mean there may be something in the furure that wacks America right in the economic "butt" and throws us for a loop. I believe this is very possible and maybe even likely if we strike Iran. But again, even if we do strike it will not be this immediate armaggeddon situation x like everyone always talks about.

My hope is people will read it as it sounds. Not dire. No reason to be
selling your life and heading to the mountains. And something I think
people forget is even if some major catastrophe occurs and the economy
tanks there will still be trade, probably locally mostly, but there will
still be some sort of trade. We are not barbarians. Look at the dark
ages. Plenty of building, advancement (although, obviously stiffled for
a few hundred years) and sought after luxuries.

Its not as if all of a sudden your home will up and disappear, your car
will be gone and all the food will be missing all at one time.
I certainly agree people should be prepaired for the worst at all times,
but I think (as a thread comes to mind) people should not let the ATS
effect get to them to early when the current 'signs' just aren't telling.

_____________________________________________________________

Reply to pluckynoonez

Big business is going down. Big dominoes in a domino-effect
trickling-down our way. You can be certain, my prediction of total
financial armageddon by November 1, 2008 will happen.

I understand how appealing this notion is, but I hope you read my post
above. Just try to keep your feet on the ground. Have no fears girl.
Even if it happens whatcha going to do about it? I hope continue to be a
good person.

_____________________________________________________________

Reply to Swingarm

So do your own research and don't listen to lawyers.

Not a bad rule to live by! LOL. When I said he was a lawyer I tried to

say that tentatively. His job was not a lawyer per se. I am sure he is somewhat of a financial analyst, but he handles much of the legalities of Morgan Stanley trusts, thats why I called him a lawyer. But like i said in the OP I really don't know the title of his position. Also, wanted to point out, he must have some higher position within his branche. I know he travels across the country on business paid for by the company.

Just trying to give an idea about his credentials. In other words he definitely is not the janitor!

_____________________________________________________________

Reply to TheComte

who would trade food for gold? Not me.

Personally, I think gold is a good idea in any case, be it Sit X or some kind of economic downfall. It can help you get back on your feet when the economy recovers and it will always be a worthy trade for some essentials.

_____________________________________________________________


Reply to 2stepsfromtop

Welll first of all, he is a Lawyer,

Please see my reply to Swingarm

I agree with most everything else you pointed out. Thanks



[edit on 14-7-2008 by abelievingskeptic]

I have to agree with pluckynunez on this. We are about to be in big BIG trouble.

It's not time to run to the hills just yet, but you better be ready for that type of scenario now, because if you live in a big or medium city, you may literally have to "bug out" within the next 6-24months.

If you are thinking about buying some gold, I might recommend getting some junk silver coins( quarters, dimes, and .50 cent pieces minted in the U.S. before 1964). They are really good for barter when society fails. In 1940 a silver dollar would buy 5 gallons of gas, guess what..... a silver dollar will buy 5 gallons of gas today too!!!!

Ammo will be just about as good of a barter item. Get a few thousand rounds of .22 LR ammo, it's dirt cheap, but you can use it to defend yourself, and put dinner on the table.(you might want a gun or 2 if you don't already have one)

How much gold are you going to be able to carry when you have to 'bug out' of the cities? Are you going to forsake food and water to carry gold. That's assuming you store your gold in your house somewhere. Forget about it if you have it in a safety deposit box in a bank, it's gone. How will you get it?

You guys can have your gold. I'll keep my food.

I look at gold as it is good to have when the economy gets better. If it crashes it will not do you much good. When its upswing again, then its good to have it.