Morgan Stanley, Goldman Sachs Plan To Rebrand Failure As Success

I have wonderful news to report to everyone! Apparently I have woken up today in a parallel universe, where the sun is shining and the birds are singing and my coffee tastes like malted orgasm. There's something called a "Dylan Ratigan" on my teevee, asking shouty sports pundit Stephen A. Smith about auto bailouts, so it's not like EVERYTHING makes perfect sense, but here's the real good news! Apparently, the financial collapse in the derivatives market never happened! EVERYTHING OLD IS NEW AGAIN AND WILL SUCK AGAIN, YAY!

From this bizarro universe's Bloomberg:

Morgan Stanley plans to repackage a downgraded collateralized debt obligation backed by leveraged loans into new securities with AAA ratings in the first transaction of its kind, said two people familiar with the sale.

Morgan Stanley is selling $87.1 million of securities that it expects to receive top AAA ratings and $42.9 million of notes graded Baa2, the second-lowest investment grade by Moody's Investors Service, according to marketing documents obtained by Bloomberg News. The bonds were created from Greywolf CLO I Ltd., a CDO arranged in January 2007 by Goldman Sachs Group Inc. and managed by Greywolf Capital Management LP, an investment firm based in Purchase, New York.

Ahh, apparently this parallel universe's version of Choire Sicha is just as critical of these geniuses as he is in the real one. This is blockquoted for maximum sarcasm:

HOW COULD THIS IDEA FAIL? How could anyone not want to put their money in this? This is so dizzying, it's like it is 2003 outside, and everything is new and shiny again.

You know what is going to be neat? Seeing which ratings agency bites first at giving this turd sandwich a AAA rating! All of us in this parallel universe plan on running around the streets with our pants off that day, because there are no consequences for failure, ever, apparently.

UPDATE, from my exasperated father, who writes:

It will be interesting to see who buys this shit but we may never know. Some people never learn. BUT! If you offer it at a price and a rate, somebody can be found to speculate on anything, and if you sell it to somebody connected or to someone who is "too big to fail"...well we have already proven that we can handle the "moral hazard" argument. Here we go again. Look at the names associated with all this. And the one you have to wonder about the most is the rating's agency, Moody's. They must feel like they are invisible and bullet-proof because they certainly have escaped real scrutiny in all of this that has just passed. And! They are paid by the issuers to give them a rating on this shit. Not much independence there!

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Comments

[steppenwolfsayshi]

We've given the banks like a gagillion (I lose count) dollars to sell their junk bonds. I don't want that crap in my investment accounts when I'm being told that I've bought AAA, safe, investments. The non-sense will stop or I won't invest. The banks think we're chumps. What happens if I put all my money under my mattress??

[Darkhorse77]

Probably the safest place. No way in hell I'm going to invest my 401k money (which was in money market anyway, which is sadly not FDIC insured so little is going in now). Our 401k rep came to our office few weeks ago and actually had the gall to say "we know when the market bottomed out, March X, 2009". Actually, we don't know that at all, nor do we know if it's going to go further down. She also said "The good news is you can get more shares for your money now." And suggested people nearing retirement put 50% of their funds into stock. One wonders how many people will fall for this crap.

[marijam]

No need for that. Put it in your small, local bank. Take it out of stocks and funds and put it into sure things; certificates of deposit, Treasury bills and Savings bonds. Why let them gamble with your hard earned money?

[2garen]

War is Peace, Lies are Truth, No is Justice, Lobbyist money is Equal Law. we could go on and on with this. Orwell would love this.

[drkazmd65]

I figured somebody here would beat me to the punch with the "1984" quotes,...

[WIpatriot]

First thing that came to my mind, doc, when I read the headline. I expected more quotes....

[flamenfiddle]

Where is the outrage? Where are our "leaders" (Obama) . Goldman Su.cks and Morgan Steal.from-me are nothing but one trick ponies - so here we go again.
And we deserve it.

[aliceinks]

There are hundreds of posts and articles bashing Sarah Palin..how many in this thread? Shows you were the priorities are in America.

[lynettema]

Finance is far more difficult to understand than Sarah Palin. Sometimes I believe that the financial community uses their jargon just to keep us from knowing what is going on.

[shamaniceconomist]

It's because the people in the alternate reality we call Washington haven't taken the financial crisis seriously that this kind of thing can still happen. This kind of financial repackaging should have been criminalized more than a year ago after people saw how much damage was being done.

[sosi]

Stop more crimes! Goldman Sachs and alike are the root causes: http://www.goldmansachs666.com

The Great American Bubble Machine, Matt Taibbi on how Goldman Sachs has engineered every major market manipulation since the Great Depression
http://www.rollingstone.com/politics/story/28816321/the_great_american_bubble_machine#

[lazercat2008]

Republican's take notes, re branding is the ticket. The Republican party Now 50% more Crooked and scandalous.

[research]

The Banksters DID SUCCEED:

14 TRILLION bucks from the taxpayers,

Wow!

http://dailybail.com/home/bailout-by-the-numbers-total-fed-committments-now-total-139.html

The greatest heist in human history!

[breakingpoint]

I trust them about as far as I can throw them.

guard your pension funds, what's left of them

[PresidentRobertBooth]

***Morgan Stanley plans to repackage a downgraded collateralized debt obligation backed by leveraged loans into new securities with AAA ratings in the first transaction of its kind***


I have a rule

Never buy anything that requires such a overly- complicated, byzantine description.

[northstar11]

those retention bonuses ----are they to keep the people ---or to keep the people quiet???

[HoneyBaked]

Jason's postings are getting harder and harder to read... Jason, if I wanted TMZ/Hollywood Reporter-esque writing, I would visit their sites. You are writing for a "News" site, please for the love of god, cut back on the melodramatic writing style... for it burns the eyes!

[Kevin Solarz]

agreed. someone was asking why there weren't as many comments on here than on Sarah Palin or whatever article is hot. its hard to take stories like this seriously; so much sarcasm...But I do enjoy reading your columns jason

[ProtectTheBabies]

Obama is the biggest scam artist and sellout of all time. Has he kept any of his campaign promises? This is beyond scary - If his pay Czar allows AIG to pay bonuses, it's time to start the impeachment process. Obama will go down as our worst president ever.

[ErnestineBass]

Not by a long shot, squirt.

But he is losing more and more support from his base with each passing day.

[ditsylilg]

love their new commercial: we're new, but we have 150 years of experience...

[Beernuts]

Yeah...like Chase taking over WAMU. Here in WA state, their new slogan is "Time for better banking Washington" ( as if WAMU was gullty of mistreating their customers) while they implement new fees for everything. I wouldn't be surprised if they somehow charged for the air you breathe while standing in the (now long) line.

[ErnestineBass]

"BAILOUT II", coming soon to a theatre near you!

[lightningbolt]

These companies will not stop trying to loot us until there are huge angry mobs on the streets asking for their heads. The government isn't doing anything to bring justice to these criminals, so we might one day have to take justice into our own hands. Otherwise, we will continue taking it in the behind while getting our pockets picked.

[Pete2069]

These companies are our government..

[HamletsMill]

Yep.

[ProtectTheBabies]

What did you think would happen when you heard that Obama appointed Tim Geithner????
Geithner is from Goldman Sachs !!! Why didn't Obama appoint a consumer advocate to the Treasury?? Because he has to pay back his campaign donors and lobbyists.
Obama has pulled the biggest con job of all time on the American people. I say we surround the White House and recall Obama.
Put McCain in office and all of this bullsh*t will stop immediately.

[lightningbolt]

Hahahahaha. If you think any republican will stop the looting you are very mistaken. Remember it was Bush who started the looting. The only way to make it stop is with massive protests or voting for a third party in the next elections. Don't count on any republican or democrat to deliver justice and change. Both parties are corrupt.