It’s worth taking a second to knock down a piece of rapidly emerging spin about those “very generous” “retention payments” that Morgan Stanley announced for its financial advisers last week, (as well as those of Smith Barney, with which its soon to merge) according to audio obtained by the Huffington Post.
The New York Times reports:
James Wiggins, a Morgan Stanley spokesman, said that such payments were necessary and would come out of operating revenue, not government bailout funds.
Wiggins gave Huffington Post the same line yesterday.
But Dean Baker, of the Center for Economic and Policy Research dispenses with this quickly, writing on his blog at the American Prospect:
Since money is fungible, this comment doesn’t make any sense.
Incidentally, a Morgan Stanley spokeswoman gave us the same line about operating expenses when we called about the payments yesterday. But, given that, as Baker says, money is fungible, it didn’t seem worth reporting.