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Looks Like Geithner Is Auditioning for a Wall Street Job

October 7, 2011
Treasury Secretary Timothy Geithner said on Thursday that there was “absolutely” no chance that another U.S. financial institution would fail - which must have appealed to Morgan Stanley and other bank stocks.  Mr. Geithner explained his position, in these terms:

"The direct exposure of the U.S. financial system to the countries under the most pressure in Europe is very modest.  Europe as a whole, though, is a big deal.  Our firms, and this is true across the largest institutions in the United States, again are in a much stronger position if you look at their capital levels, levels of leverage, how they’re funded." The comments were made before the Senate Banking and House Financial Services Committees on Thursday.

The comments were not lost on investors, who promptly bought shares in a number of financial firms, including Morgan Stanley.  MS shares rose 4.8% on Thursday, to $15.18.   Prior to today, MS shares were down about 44% in 2011.   [Dealbook, 10/6/11]