Bahnsen 'Stunned' by Morgan Stanley-E*Trade Deal, Predicts Difficult Merger

The transcript discusses Morgan Stanley's $13 billion acquisition deal, comparing it to past deals like the acquisition of Smith Barney. Concerns are raised about the brand alignment and economic implications, particularly the shift towards zero fees. The cultural challenges of merging with E Trade, whose clients typically do not seek advisory services, are highlighted as a significant hurdle.

What was the surprising aspect of Morgan Stanley's deal with E-Trade?

• It was similar to a previous deal with Citigroup.

• The deal was smaller than expected.

• The deal was significantly larger than past acquisitions.

• It involved a new industry for Morgan Stanley.

How does the deal with E-Trade differ from Morgan Stanley's acquisition of Smith Barney?

• It was a smaller financial commitment.

• It was more aligned with Morgan Stanley's brand.

• It was much larger in financial terms.

• It was less expensive.

What economic challenge is highlighted in the Morgan Stanley and E-Trade deal?

• Increasing fees for clients.

• A rise in stock prices.

• A shift towards zero fees.

• A decrease in client base.

Why might the merger between Morgan Stanley and E-Trade face cultural challenges?

• E-Trade clients are accustomed to paying high fees.

• E-Trade clients are not typically looking for advisory services.

• E-Trade clients seek extensive wealth management advice.

• E-Trade clients prefer traditional banking services.

What is a potential issue with integrating E-Trade's client base into Morgan Stanley's services?

• E-Trade clients are primarily interested in high-risk investments.

• E-Trade clients are not interested in paying for trades.

• E-Trade clients are looking for more personalized banking services.

• E-Trade clients are focused on international markets.