What Wall Street Thinks of the Midterms

In case you had any doubt on which side of the divide the biggest banks on Wall Street fall, check out Morgan Stanley's memo sent to all of its employees by the bank's government relations department. Here's how it begins (via the NYT):

November 3, 2010

To: All Employees

From: Michael Stein

Subject: Mid-Term Election Results

On Election Day, United States voters spoke with unmistakable certitude. Republicans rode an antiincumbent, anti-Washington and Tea Party-driven wave to retake the House after four years in the minority, netting at least 61 seats, easily clearing the 39 needed for control. With several states too close to call as of Wednesday morning, the Senate will remain in Democratic hands. However, Republicans also managed significant gains there as well, netting at least 6 seats to reduce the Democratic advantage to 51-47, with 2 races still undecided as of Wednesday morning. This watershed election heralds a return to a divided government where Democrats and Republicans will be forced to deal first with each other if they are indeed going to deal with America’s problems.

And here's how it ends:

While agreement is likely to remain elusive in many areas where the chasm is simply too wide to bridge, limited compromise could be found in a few areas, including energy, tax, trade and immigration.