On 3 January 2024, James Gorman, the Executive Chairman of Morgan Stanley (NYSE: MS), spoke with Sonali Basak on Bloomberg TV.

The Board of Directors at Morgan Stanley announced on 25 October 2023 that Co-President Edward (Ted) Pick would be appointed as the firm’s Chief Executive Officer, effective from 1 January 2024. In this new structure, James Gorman transitioned to Executive Chairman. The announcement included Ted Pick’s induction into Morgan Stanley’s Board of Directors.

Gorman began by discussing his transition to the role of Chairman, emphasizing his focus on supporting the new CEO, Ted Pick, while avoiding interference in day-to-day operations. He shared insights into his leadership approach, including his practice of listing annual priorities and learning from past mistakes. Gorman expressed confidence in the major decisions made during his tenure, such as strategic acquisitions and navigating the COVID-19 pandemic. However, he admitted some areas, like team assembly, could have been faster.

Addressing the challenges faced in his early years as CEO, Gorman recounted the need for decisive action amidst criticism. He highlighted the strategic rebalancing of Morgan Stanley’s business model, which he believed was the right choice. When asked about Ted’s future challenges, Gorman pointed out that they would differ from his own, focusing more on strategic decisions in a successful and large company.

Gorman then touched upon his upcoming role on the board of Disney, discussing the challenges of succession and strategic decision-making in a rapidly evolving industry. He also spoke about the potential for Morgan Stanley to expand as an international wealth manager, citing the abundance of global opportunities, particularly in Asia and with their Japanese partner, MUFG.

Discussing China, Gorman highlighted the country’s demographic and economic challenges but acknowledged its significance in the global economy. On the topic of Bitcoin and cryptocurrencies in general, Gorman expressed skepticism about Bitcoin as a store of value, considering it speculative and volatile:

I’ve never really understood the value of Bitcoin as a form of stored value … It’s clearly speculative, highly volatile, and subject to significant regulatory changes.

He advised that Bitcoin should constitute only a small part of wealthy individuals’ financial portfolios, given its speculative nature and the ongoing regulatory changes in the industry.

Gorman also commented on banking regulations, expecting changes to the aggressive proposals initially put forward. He emphasized the need for balanced regulation to support economic growth and the health of the banking sector. Addressing the recent banking system challenges, Gorman downplayed the notion of a widespread crisis, attributing issues to specific banks’ wrong choices.

Finally, Gorman shared his views on the economy, expressing optimism for a soft landing and praising the Federal Reserve’s handling of inflation and unemployment rates. He concluded by discussing his plans, including increased involvement at Columbia University and a focus on client relationships at Morgan Stanley.

Featured Image via YouTube (Morgan Stanley’s Channel)