Eisinger: Bad Behavior at Morgan Stanley

Not to be missed -- ProPublica's Jesse Eisinger reviews Morgan Stanley documents made public last week in a lawsuit brought in Manhattan state court by a Taiwanese bank that purchased a CDO from the firm in 2006.  According to the article, "the documents suggest a pattern of behavior larger than this one deal: people across the bank understood that the American housing market was in trouble. They took advantage of that knowledge to create and then bet against securities and then also to unload garbage investments on unsuspecting buyers."  Morgan Stanley's defense, of course, is that the buyers were sophisticated investors that should have done their own due diligence.  Read it and see what you think.  NYTimes Dealbook, Financial Crisis Suit Suggests Bad Behavior at Morgan Stanley