With financials taking the biggest hits in the Wall Street crisis, Morgan Stanley CEO John Mack has sprung into action, reports BusinessWeek:
As Morgan Stanley's stock price spiraled downward one day after the firm announced the strongest profits on Wall Street on Tuesday, CEO John J. Mack swung into action. Mack made calls to Treasury Secretary Hank Paulson, SEC chairman Christopher Cox, New York senator Chuck Schumer, and Hillary Clinton, asking them all to take steps to stop short sellers from driving Morgan Stanley's stock down further.
At the same time, Mack and his team began to consider the company's other options. As The New York Times reported, Wachovia's CEO Bob Steel put in a call to see if Mack would be interested in merging, according to a person familiar with the discussion.
In response to Morgan Stanley's stock price moving downward with the rest of the market, John Mack wrote a memo to his employees:
In a memo to employees yesterday, Mack said the management committee is ``taking every step possible to stop this irresponsible action in the market,'' and he urged employees to contact clients to reassure them that the firm is performing strongly and has plenty of capital.
``There is no rational basis for the movements in our stock or credit-default spreads,'' Mack wrote in the memo. ``We're in the midst of a market controlled by fear and rumors, and short sellers are driving our stock down.''