WASHINGTON — The administration defended its role in the bailout of Wall Street investment bank Bear Stearns before the Senate Committee on Banking, Housing and Urban Affairs, saying that it was necessary to avert a greater breakdown in the financial market.
Timothy Geithner, president of the Federal Reserve Bank of New York; Christopher Cox, head of the Securities and Exchange Commission; and Treasury Under Secretary Robert Steel faced tough questions from Senators Charles Schumer (D-N.Y.) and Christopher Dodd (D-Conn.) on how the buyout was structured and priced and if signs of trouble signs were seen too late. "Was someone asleep at the switch?" asked Schumer.
The senators wanted to know whether organizing the buyout of Bear Stearns by JPMorgan Chase last month set a precedent for taxpayer-backed bailouts of financial companies. The witnesses demurred, describing the action as unusual but necessary. "How do we guard against a future Bear Stearns?" asked Schumer. "It is a long road until our system of regulation catches up with our financial system."
Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
- Exclusive discounts on ALM and CU Times events.
- Access to other award-winning ALM websites including Law.com and GlobeSt.com.
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
