As they say, be careful what you wish for.

For years, Morgan Stanley investors prayed their elite, white shoe firm, which married beneath its station to Dean Witter in 1997, would get out of the credit card business and focus on banking and markets. Just like Goldman.
   
This summer John Mack heeded the call and spun off Discover. Now Morgan Stanley, looked more like Goldman. 

Now that Morgan is comparable to Goldman’s mix of businesses, investors can make those pesky comparisons.

That’s not exactly good news for Morgan.
   
Lately, the once-preeminent descendant of J. Pierpont Morgan himself is looking less like Goldman and more like, Heaven forbid, Bear Stearns: Trading woes, mortgage losses.
   
So as far as 2007 goes, there was no competition. Goldman earned $12 billion on $46 billion of revenue, both setting new records. Compensation soared to $20.2 billion, more than any bank ever paid.
   
By contrast, Morgan Stanley had negative revenue (huh?) and a net loss in the fourth quarter. Annual profit fell and for Mack, who instructed the firm two years ago to crank up its risk profile (like Goldman), there will be no Christmas bonus.
   
The difference was that a small handful of Goldman’s proprietary traders beat the heck out of Morgan’s handful of prop traders. Where as the Broad Street Bulls reaped some $4 billion by shorting subprime mortgages, Morgan Stanley, err, did not.
   
Morgan CFO Colm Kelleher walked analysts through how one desk of fixed income traders, under the watchful eye of rising star Zoe Cruz and other departed managers, looked brilliant in the first quarter but then lost a stunning $7.8 billion in a three month period.

Meanwhile, Goldman raked in the profits. Again. So as far as that comparison with Goldman is concerned, Morgan isn’t quite measuring up right now, credit card division or not. 

(Photo. John Mack. AP)