Morgan Stanley CEO James Gorman didn't feel the need to make any apologies in his first public comments since Facebook's IPO disaster. Gorman, speaking to CNBC, defended his bank's role as chief underwriter on the deal. "There are lot of opinions," he said of the decision to set the offering price at $38. "It's very different being in the room and understanding what the demand was at that point in time," he said. Facebook shares have dived more than 23% since the launch two weeks ago, and finished at $29.60 yesterday.
Gorman denied there was any "nefarious activity" involved in how the firm communicated a cut in earnings forecasts to major clients, and placed the blame for first-day trading problems on NASDAQ. "It was one of the most volatile openings to an IPO ever," he admitted, urging investors to give the stock some time to find its appropriate level. Investors who got burned hoping for a pop in first-day trading were "both naive, and bought it under the wrong pretenses," he said, adding that short-term investing is always risky.