For a while, the buzz was that Morgan Stanley was bleeding financial advisors, especially disgruntled legacy Smith Barney advisors, in the wake of the merger between the two retail brokerage forces. FAs were said to be unhappy with the pace and management of the integration. But the firm said in its second quarter earnings report that the integration is on track. Morgan is also working on cutting costs, and has been laying off underperformers. FA headcount declined a net 160 during the quarter to 17,638.