They're still thinking bigger is better. Which is not encouraging.

Last paragraphs:

In recent days, Morgan Stanley had sought other ways to bolster its capital and had been in advanced talks with China’s sovereign wealth fund and others about raising billions of dollars, people briefed on the matter said Sunday night. It had also been talking about a merger with Wachovia, a large commercial bank based in Charlotte, N.C.

With their transition to operating as bank holding companies, those talks are likely to take a different form, because now Morgan Stanley can buy a commercial bank.

(Time for some of this?)

basically, these institutions have been operating on the margins (literally and figuratively) for years, and now want to come in from the cold and have the taxpayers assume the risk for their irresponsibility?

Nothing prevents these companies from acting responsibly....and if they want to get fed insurance, they should qualify under the exact same rules as retail banks. Of course, that would mean that these investment houses would collapse, because in order to accomplish that, those banks are going to have to sell off at least 50 percent of their assets....