Thain Sets Bloggers Straight

Rumors over the health of the financial stocks have been the subject of intense speculation. Writedowns, layoffs and dilutive financing arrangements are typical of the chatter, unless you count the $8 billion share buyback that Goldman was supposed to announce.

The CEO of Merrill Lynch acknowledged the speculation today on the company’s conference call, and once again tipped his hand:

“For those of you who like to blog,” said Thain, “We do not have any plans to raise any additional common equity and [chief financial officer Nelson Chai] actually agrees with that.” Deal Journal

Or course, not all is good at Merrill, but Thain has rolled up his sleeves and is slowly making progress. But it is worth noting that he said “common equity”, he appears to be leaving the door open to additional capital injections, and perhaps he is trying to signal that equity holders will not be diluted going forward.  And the shorts lost one of their bullet points in the thesis.

But, much like the rest of Wall Street, the firm is a mere shadow of what it resembled a scant two years ago. Thain’s work has just begun.

John Thain: Chief Executive and Blog Reader
Deal Journal

Merrill’s Mire
Portfolio

Merrill Lynch
Conference Call Transcript
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