BSC if no one buys...then what?

K

killATwill

Bear Stearns Saturday Update

Charlie Gasparino at CNBC reports: Bear Stearns Weekend Talks Reveal 2 Key Contenders (hat tip risk capital)

... potential bidders for Bear have been narrowed to ... J.C. Flowers and JPMorgan Chase

... bankers have now come to the conclusion that a deal must be done by Monday ...

If there's no deal Bear Stearns will have to file for bankruptcy, executives said.

http://calculatedrisk.blogspot.com/
 
Fed will back JPM as JPM comes under its control but JC Flowers does not and in any case does not have the expertise and maybe doesn't have the balance sheet or credit lines needed. This is a real problem here, nobody wants private equity fairies involved when the system is at risk of collapsing.
 
Fed needs to back off. BSC is a broker, not a bank.

Housing group challenges Fed's Bear Stearns deal:
http://uk.reuters.com/article/marketsNewsUS/idUKN1630454820080316?rpc=401&

"WASHINGTON (Reuters) - A housing and fair lending activist group has challenged the legality of the Federal Reserve's quick approval of financing for Bear Stearns (BSC.N: Quote, Profile, Research) via JPMorgan Chase (JPM.N: Quote, Profile, Research), questioning the Fed's authority to approve the deal because it involves a non-bank institution.

Inner City Press Community on the Move, in a complaint filed with the Fed late Saturday, called the central bank's brokering of the deal "entirely illegal" and anticompetitive, and questioned whether sufficient Fed members had voted for it."
 
"The Fed has hit a new low with this, they did nothing to protect consumers from predatory lending and now their response is to bail out one of the most notorious enablers of predatory lending with no benefit to struggling consumers," said Lee.

"This should be taken as far as it can go to finally bring the Federal Reserve to account that they work for the public interest and not only Wall Street, particularly in a time of crisis," he told Reuters on Sunday.

The Fed could not immediately be reached for comment.

The complaint also asks for a probe into Bear Stearns' disclosure of its financial condition, citing an interview the firm's chief executive gave on CNBC television earlier in the week during which no mention of the scope of the firm's financial troubles were made.

I hope they nail them.:mad:

pS
 
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