Danny Schechter - ColdType

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Bamber replied, “Absolutely, in my mind, the real nexus
point was of the Bear Stearns crisis was the Sunday night, minutes
after Bear inked their deal with JP Morgan they opened
up the discount window for the very first time to all the investment
banks.
Had Bear had access to that window would we have survived
as an independent entity like we’d always been? Probably
not, but we would have had time to negotiate a deal that
was good for Bear, good for Bear shareholders, good for Bear
Stearns employees, etc., with a larger financial institution.”
That didn’t happen. In this, the first of many bailouts to
come – Bear employees saw it as a take-out, not a bail out
– the Bear shareholders were in effect wiped out with the
creditors taking the bulk of the money, 14,000 Bear employees
would later get the axe.
JP Morgan Chase got the deal of the century.
Bamber told me how he and other employees perceived the
events. “After the deal was announced, the market cap of JP
Morgan went up about fifteen billion dollars. Roughly speaking
the market cap of Bear Stearns prior to the start of those
rumors. We felt at that time it was a wealth transfer from Bear
shareholders to JP Morgan shareholders.”
The day Bear was sold to JP Morgan for (at the time) $2
dollars a share, Bamber and his Bear colleagues predicted that
Lehman Brothers would be the next to go, as well as Merrill
Lynch as an independent entity. They were right, Lehman filed
for bankruptcy on Monday and Bank of America later bought
Merrill.
Former Bear CEO Jimmy Cayne was pissed. The New Yorker
quoted his comment on Tim Geithner, the current Treasury
Secretary then with the New York Fed, who orchestrated the
deal:
The audacity of that prick in front of the American people
announcing he was deciding whether or not a firm of this