The Nationalization of an American Bank
The historic nature of the effective nationalization of Bear Sterns is hard to underestimate.
We've said before, we ain't no economists here. But, we've never -- not once -- seen anything like it. And neither has anyone else. If only on this level:
The American Government does not nationalize. And technically, the Fed didn't -- it just gave JP Morgan the credit line to do it, and is taking control of Bear's operation as part of its secruitization process. And JP Morgan says its costing them $6B to doe the deal. Yikes!
This reveals a level of concern at the government level that we haven't seen in more than 60 years. The question is will this action help stem the panic, and fuel it. The bottom line is the Fed and Treasury see the possibility of a financial system collapse. The system probably will not, but we've gotten to the point where it could.
We've said before, we ain't no economists here. But, we've never -- not once -- seen anything like it. And neither has anyone else. If only on this level:
The American Government does not nationalize. And technically, the Fed didn't -- it just gave JP Morgan the credit line to do it, and is taking control of Bear's operation as part of its secruitization process. And JP Morgan says its costing them $6B to doe the deal. Yikes!
This reveals a level of concern at the government level that we haven't seen in more than 60 years. The question is will this action help stem the panic, and fuel it. The bottom line is the Fed and Treasury see the possibility of a financial system collapse. The system probably will not, but we've gotten to the point where it could.
posted by Zero at 9:26 AM
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