Why Did the Stress Tests Treat Goldman Sachs Group Better Than Morgan Stanley?

That's the question WSJ is asking this weekend.

WSJ reports:

In the period, the Treasury and bank regulators are saying Goldman will have $18.5 billion in "resources other than capital to absorb losses." This number primarily reflects how much in earnings, excluding provisions and securities marks, a bank can generate. For Morgan Stanley, the government has a much lower $7.1 billion...

Were the tests' assumptions "stacked in Goldman Sachs's favor?" asks Michael Hecht at JMP Securities. He notes that the $7.1 billion for Morgan is 62% below Goldman's figure, whereas Morgan's reported net revenue has, on average, been only 22% below Goldman's over the past five years.

And, oh yeah, there is transparency, until transparency counts. WSJ, again:

The government documents don't give enough detail to explain the gap.