Morgan Stanley lays of employees after the loss that it sustained. The layoffs come at the time when the entire street is reeling under the problems on the debt side, courtesy the sub prime crisis.
The concept is pretty simple: most of the investment banks have very large debt portfolio's, these debt portfolios are rolled over from time to time. But in times of crisis there are no buyers for these portfolios and then the value of the assets becomes close to zuk. This is what happens, boom.
What has happened with this round of crises is that MS has decided that people have to be laid of off. When there was run of good results quarter after quarter the person who took the good name was Mr Mack ( yeah the MS savior), but this time when the going gets bad the hit goes on 300 bankers. The bonus I hope gets pruned this year. "We are cutting down costs", and there the markets are happy.
What about the poor employees? Well they are cogs that are not important enough? The markets have not called for the head of the guys who ran up the loss in the first place or collecting the money from the bonuses paid out last year ( Investment banks pay upto 40% of revenue as bonuses ).
Most employees in the current environment are used to being laid off. The job marked is primed too, they will find jobs in no time. But if an organization claims high moral standards as MS does, is this the way to go?