SecProbe.io

Mail Stop 4561
      April 9, 2009

VIA U.S. MAIL AND FAX (212) 507-1869

 Colm Kelleher Chief Financial Officer Morgan Stanley 1585 Broadway New York, NY  10036

Re: Morgan Stanley
Form 10-K for Fiscal Year Ended
  November 30, 2008   Filed January 29, 2009
Proxy Statement Filed March 20, 2009 File No. 001-11758

Dear Mr. Kelleher:

We have reviewed your filing and have the following comments.  In our
comments, we may ask you to provide us w ith information so we may better understand
your disclosure.  After reviewing this inform ation, we may raise additional comments.
  Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure  requirements and to  enhance the overall
disclosure in your filing.  We look forward to  working with you in these respects.  We
welcome any questions you may have about our  comments or on any other aspect of our
review.  Feel free to call us at the telephone numbers listed at the end of this letter.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 2   Form 10-K for the fiscal year ended November 30, 2008

 Item 1. Business

 Additional Regulation of U.S. Entities, page 15

 1. Please tell us the net capital requiremen ts imposed by the CFTC on MS&Co. as a
registered futures commission mercha nt.  Also, provide a more detailed
description of the regulat ory requirements imposed by the CFTC and the NFA on
your subsidiaries.  Please confirm that you wi ll provide this disc losure in future
filings.
 Item 3. Legal Proceedings, page 28

2. Please tell us the relief sought by plainti ffs in each of the litigation matters that
you have disclosed.  Also, tell us the fact ual basis alleged to underlie each of the
proceedings if it has not already been disclosed.  Please confirm that you will
provide similar disclosure in future filings.
 Item 7. Management’s Discussion and Analys is of Financial Condition and Results of
Operations

General
 3. Please tell us what consideration you gave  to disclosing the gain/loss on all items
that are carried at fair value.
 4. We note that you disclose the amount of each line item that is accounted for at fair
value in your statements of financial c ondition. Please tell us what consideration
you gave to further disclosing how much of those assets an d liabilities are
accounted for at fair value pursuant to the fair value option rather than pursuant to
other accounting guidance.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 3   5. For credit protection sold and credit protection purchased, please tell us and
consider disclosing the extent to wh ich the derivative activity was for the
following purposes:
• Provide default risk protection to o ffset credit exposure to your holdings
of the related reference entity’s debt  in your loan portf olio, investment
portfolio, or loan commitments outstanding;
• Create new credit exposure fo r your own trading purposes;
• Reflect credit exposures taken for th e benefit of your clients; and
• Provide an offset to credit exposure taken for the benefit of clients.
Further, discuss your overall strategies  employed in your credit derivatives
portfolio as well as any changes in thos e strategies during the periods presented.
 6. In addition to the above, please tell us and consider disclosing the following
information related to your credit default swaps:
• Separately quantify the gross realized  gains and losses from your credit
derivative activity.
• Discuss any trends experienced with in the portfolio both in terms of
positions held and realized gains and losses. Specifically disclose the reasons for the significant changes in  the notional amounts as well as the
reasons for the changes in the fair values of the swaps. Discuss any expected changes to those trends.
• Discuss the types of counterparties (e.g. broker-dealers, other financial
institutions, non-financial instituti ons, and insurance and financial
guaranty firms) to your credit protec tion purchased.  Consider quantifying
the notional amount of credit deri vatives by type of counterparty,
separated between whether you pur chased protection from the
counterparty or sold protec tion to the counterparty.
• Discuss how you incorporated your own credit risk and the counterparty’s
credit risk in your valuati on of the credit derivative.
 Certain Factors Affecting Results of Operations

 Morgan Stanley Debt, page 47

 7. Please tell us what consideration you ga ve to disclosing the portion of the $2.3
billion gain from repurchasing your de bt that was due to changes in the
Company’s creditworthiness and that was due  to changes in market terms.  Also,
please tell us if this debt was recorded at fair value prior to  the repurchase.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 4   Business Segments

 Institutional Securities

 Equity Sales and Trading Revenues, page 51

 8. We note your disclosure that your pr ime brokerage business experienced
significant outflows as clients withdrew  their cash balances and reallocated
positions.  Tell us what consideration you have given to providing an analysis of the activity in client accounts similar to that provided for your asset management segment on page 61.
 Other Matters

 Real Estate-Related Positions, page 63

 9. We note you excluded amounts related to mo rtgage-related securi ties portfolios in
your Subsidiary Banks from your disclosu res on page 65 and 66.  Please tell us
why management believes it was not necessary to include this information for your Subsidiary Banks.

Critical Accounting Policies

 Fair Value

 Financial Instruments Measured  at Fair Value, page 70

 10. We note recent market conditions have  caused certain instruments to be
reclassified to Level 3.  As the valu ation of Level 3 in struments requires
significant judgment by management, please tell us what consideration you gave
to providing a sensitivity an alysis related to the valuation of these instruments.
 Commitments and Contract ual Obligations, page 84

 11. We note that the amount of Long-term borrowings within your contractual
obligations table appears to only include principal payments.  Please tell us why
you have not included interest related to your Long-term borrowings.  Please refer
to footnote 46 in our Release 33-8350.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 5   Financial Statements

 Consolidated Statements of Financial Condition, page 107

 12. We note you have performed an interim impa irment test during your fourth fiscal
quarter and recorded an impairment charge for a portion of your goodwill.  It appears that your market cap italization continues to be  significantly below the
book value of your equity.  Please provide us  with a summary of your results from
Step 1 and Step 2 of your SFAS 142 impairment test.
 Consolidated Statements of Income, page 109

 13. It appears your line item fo r other non-interest expenses  aggregates items that are
greater than one percent of total interest income and other income, such as certain
impairment charges.  Please tell us how you have complied with Rule 9-04.14 of Regulation S-X, or tell us why you believe  it was not necessary to disaggregate
these items.
 Notes to Consolidated Financial Statements

 3. Fair Value Disclosures

Fair Value Measurements
 Financial Instruments Owned and Financia l Instruments Sold, Not Yet Purchased

 Derivative and Other Contracts

 OTC Derivative Contracts, page 128

 14. Please clarify for us where your credit deri vatives are classified  within the fair
value hierarchy.
 8. Borrowings

 Long-Term Borrowings

 Maturities and Terms, page 147

 15. Explain to us how you determined it would be appropriate to disclose maturities
of long term debt net of fair value adjust ments.  Reference is made to paragraph
10 of SFAS 47.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 6   9. Commitments, Guarantees and Contingencies

 Commitments, page 149

 16. Please tell us what consideration you have  given to disclosing  the allocation of
primary lending commitments between investment grade and non-investment
grade.
 Contingencies, page 156

 17. We note that you are involved in several le gal matters as discussed in Item 3 of
your Form 10-K.  Please tell us how you have complied with the disclosure
requirements of paragraphs 9 and 10 of  SFAS 5, related to these matters or
explain to us why no additional disclosure is necessary.

Auction Rate Securities Matters, page 157

 18. Explain to us why you have not accrued your total exposure as it relates to ARS
eligible under the repurchase program in  accordance with paragraph 10 of FIN 45.
Additionally, explain to us how you determined the fair value of your auction rate
security purchase obligations.

13. Interest and Dividends and Interest Expense, page 167

 19. Given the Company’s recent conversion to a bank holding company, explain to us
whether you have reconsidered your po licy of presenting interest expense on
financial instruments sold, not yet purcha sed as a reduction of interest revenue.
Reference is made to paragraph 7.105 of  the AICPA’s audit guide for Depository
and Lending Institutions.
 20. Business Acquisitions and Dispositi ons and Sale of Minority Interest

 MSCI, page 185

 20. Given your two year history of selling sh ares of MSCI, and your disclosure that
you may ultimately divest your entire inte rest in MSCI, explain to us how you
determined it would be appropriate to r ecognize a gain on the sa le of subsidiary
stock in accordance with question 2 of SA B Topic 5h.  Furthermore, please tell us
how you have complied with the classifi cation and disclosure requirements of
question 6 of SAB Topic 5h as it relates to the gain on sale of MSCI shares.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 7   Morgan Stanley Wealth Management S.V., S.A.U., page 186

 21. Please explain to us how you considered  the guidance in pa ragraph 42 of SFAS
144 and EITF 03-13 in determining whether the operations and gain and sale of
MSWM S.V should be presented as discontinued operations.
 21. Quarterly Results (unaudited), page 187

 22. It is unclear from your disclosure if the two adjustments you refer to in note 1 to
your quarterly results table are due to errors in prev iously issued financial
statements.  Please clarify.  To the extent either of these adjustments is due to an
error, explain to us how you have met th e disclosure requirements of SFAS 154.
 Proxy Statement on Schedule 14A

 Executive Compensation

 II. Compensation Program for 2008

 A. Overview of Key Actions, page 14

23. We note your reference to Mr. James Gorm an as one of your three most senior
officers.  Please tell us why he is not listed as one of your named executive officers in the Summary Comp ensation Table on page 26.
 III. 2008 Compensation Process and Decisions

 B. Evaluating Company and Individual Performance

 Peer Group Data, page 18

 24. Please tell us which competitors the CM DS Committee considered in connection
with 2008 compensation.  We note that  you identified the “investment bank”
competitors but concluded that changes within the industry made this group no
longer a useful comparison.  We also note that you have identified a group of
“core competitors,” but it is not clear whether this is the group considered by the committee.  In addition, tell us wh ether the CMDS Committee targeted
compensation at a certain range compared to the peer group.  Please confirm that
you will provide comparable disclosure in your future filings.

Colm Kelleher
Morgan Stanley April 9, 2009 Page 8   Evaluating Company and Indivi dual Performance, page 19

 25. The introductory paragraph to this s ection states that the CMDS Committee
evaluated Company, business unit, and indi vidual performance against the metrics
and priorities described under “Facto rs Considered in 2008 Compensation
Decisions.”  The description of this evaluation, however, does not appear to
address any of the bullet points list ed under “Client, product and business
development” on pages 17 and 18.  Pleas e provide us with a more specific
discussion and analysis of how the co mmittee considered these factors in
determining 2008 compensation awards.  C onfirm that you will provide similar
disclosure in future filings.
 Other Executive Performance, page 20

 26. We note that Messrs. Kelleher, Ni des and Lynch’s compensation was
significantly reduced from the prior fiscal year and that each received an incentive
compensation award.  Please explain for us in greater detail why the CMDS Committee elected to reduce NEO compen sation by the specific amounts cited
and why it awarded incentive compensation to these NEOs.  Confirm for us that
you will include such disclosure in future filings.

IV. Changes to Compensation Program for 2009

 B. New Long-Term Performance Based Co mpensation Program for 2009, page 23

 27. We refer to your new performance-based stock unit incentive program.  Please
confirm that you will disclose in your fu ture filings the target award for each
named executive officer and the members of the comparison group of other financial industry companies.
 2008 Summary Compensation Table, page 26

 28. Please provide us with a narrative summary of the material terms of each named
executive officer’s employment agreemen t or arrangement, as required by Item
402(e) of Regulation S-K.  Provide similar disclosure in future filings.
 Potential Payouts for Certain NEOs, page 41

 29. Please provide us with an expanded disc ussion that addresses potential payouts
for each of your named executive officers or explain why the current disclosure, which covers only Mr. Mack’s potential pa youts, is sufficient.  Refer to Item
402(j) of Regulation S-K.

*    *    *    *

Colm Kelleher
Morgan Stanley April 9, 2009 Page 9
Please respond to our comments within 10 business days or tell us when you will
provide us with a response.  Please s ubmit your response letter on EDGAR.  Please
understand that we may have additional comm ents after reviewing your response to our
comments.

 We urge all persons who are responsible  for the accuracy and adequacy of the
disclosure in the filings reviewed by the sta ff to be certain that they have provided all
information investors require for an info rmed decision.  Since the company and its
management are in possession of all facts re lating to a company’s disclosure, they are
responsible for the accuracy and adequacy of the disclosures they have made.
  In connection with responding to our comments, please provide, in writing, a
statement from the company acknowledging that:
• the company is responsible for the adequacy  and accuracy of the disclosure in the
filings;

• staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking any action with respect to the filings; and

• the company may not assert staff comme nts as a defense in any proceeding
initiated by the Commission or any person under the federal secu rities laws of the
United States.

In addition, please be advise d that the Division of Enfo rcement has access to all
information you provide to the staff of the Divi sion of Corporation Fi nance in our review
of your filings or in response to our comments on your filings.
You may contact Jennifer M onick, Senior Staff Account ant, at (202) 551-3295, or
the undersigned at (202) 551- 3438 if you have questions regarding comments on the
financial statements and related matters.  Please contact Kris tina Aberg, Attorney
Advisor, at (202) 551-3404 or Karen Garnett,  Assistant Director, at (202) 551-3785 with
any other questions.

         S i n c e r e l y ,
Robert Telewicz   Senior Staff Accountant