8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant To Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): August 11, 2008

Morgan Stanley

(Exact Name of Registrant

as Specified in Charter)

Delaware	1-11758	36-3145972
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1585 Broadway, New York, New York	10036
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 761-4000

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01. Other Events

On August 11, 2008, Morgan Stanley (the “Company”) issued a press release announcing the Company’s repurchase of certain auction rate securities held by its retail accounts.  A copy of the press release is being filed as Exhibit 99 to this Current Report on Form 8-K and is incorporated by reference in its entirety.

On August 11, 2008, Moody’s Investors Services announced that it had lowered its long-term debt counterparty credit ratings on the Company from ‘Aa3’ to ‘A1.’  The outlook assigned to the Company is stable.

Statements about the expected effects, timing and completion of the repurchase of any auction rate securities and all other statements in the press release, other than historical facts, constitute forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made and which reflect current estimates, projections and expectations. In making any such statements, the Company believes that its expectations are based on reasonable assumptions. However, any such statement may be influenced by factors that could cause actual outcomesand results to be materially different from those projected or anticipated. There are various important factors that could cause actual results to differ materially from those in any such forward-looking statements, many of which are beyond the control of the Company. For a discussion of additional risks and uncertainties that may affect the future results of the Company, please see “Forward-Looking Statements” immediately preceding Part I, Item 1, “Competition” and “Regulation” in Part I, Item 1, “Risk Factors” in Part I, Item 1A and “Certain Factors Affecting Results of Operations” in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended November 30, 2007, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in the Company's 2008 Quarterly Reports on Form 10-Q and in other items throughout the Form 10-K, Forms 10-Q and the Company's 2008 Current Reports on Form 8-K.

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Item 9.01. Financial Statements and Exhibits

99 Press release, dated August 11, 2008, issued by the Company.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

MORGAN STANLEY        (Registrant)
By:	/S/    Martin M. Cohen
	Martin M. Cohen, Vice President, Assistant Secretary and Counsel

Date: August 11, 2008

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EX-99

Contact:	Media Relations Mark Lake 212 762 6927	Media Relations Christy Pollak 914 225 6827
		For Immediate Release

Morgan Stanley to Repurchase Auction Rate Securities

NEW YORK, August 11, 2008 – Morgan Stanley announced today that it will repurchase at par auction rate securities (ARS) that are held by its retail accounts and were purchased through the Firm prior to February 13, 2008.  Morgan Stanley has informed the appropriate authorities at the Office of the New York State Attorney General, the Office of the Secretary of State Illinois Securities Department (on behalf of the North American Securities Administrators Association), and the Securities and Exchange Commission’s Division of Enforcement with respect to these matters.

As part of our ongoing commitment to our clients, Morgan Stanley is announcing the following buy-back program:

●     Commencing no later than September 30, 2008, Morgan Stanley will offer to repurchase at par ARS held by all individuals, all charities and those small to medium sized businesses with accounts of $10 million or less (collectively, “retail clients”) that were purchased through the Firm prior to February 13, 2008, with the exception of those ARS where auctions are clearing or there is a scheduled redemption.  The Firm will keep this offer open until November 30, 2008.  The Firm anticipates that this buy-back program will result in repurchases from retail clients of approximately $4.5 billion.

●     Morgan Stanley will make whole any losses sustained by retail clients who purchased ARS through Morgan Stanley before Feb. 12, 2008, and sold such securities at a loss between that date and the date of this announcement.

●     Consistent with applicable regulatory rules, until Morgan Stanley actually provides for the liquidation of the securities on the schedule set forth above, on request, Morgan Stanley will provide no-cost loans to retail clients that will remain outstanding until the ARS are repurchased, and will reimburse retail clients for any interest costs incurred under any prior loan programs the Firm provided to its ARS customers.

●     To the extent that a retail client has incurred consequential damages beyond the loss of liquidity in the retail client's holdings of ARS, Morgan Stanley will participate in a special arbitration process that the retail client may elect, and that will be overseen by FINRA, whereby Morgan Stanley will not contest liability for any alleged misrepresentations and omissions concerning the ARS, but may challenge the existence or amount of any consequential damages; the arbitration claim will be heard by a single, non-industry arbitrator.

●     Morgan Stanley will use its best efforts to provide liquidity solutions for its institutional investor base, including continuing to work with issuers and other interested parties on capital markets solutions, financing options and market liquidity, with the goal of resolving institutional investor clients’ liquidity concerns no later than the end of 2009.  Institutional clients who purchased ARS after February 13, 2008, as well as institutional clients who hold ARS where the auctions are clearing will be excluded from the program.

Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services.  The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 600 offices in 33 countries.  For further information about Morgan Stanley, please visit www.morganstanley.com.

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