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Banking, finance, and taxes

JP Morgan & NY Fed Try to Rescue Bear Stearns (BSC, JPM)

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By Douglas A. McIntyre Published
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Bear Stearns Co. (NYSE: BSC) is getting a temporary reprieve this morning.  JPMorgan Chase (NYSE: JPM) and the New York Fed have provided liquidity financing for 28 days to the struggling brokerage firm.  This will allow Bear Stearns funding as needed.

There has been a run on the bank over at Bear Stearns over counterparty risk concerns and over its liquidity concerns.  Part of the announcement also notes that Bear Stearns is also talking with JPMorgan Chase & Co. regarding permanent financing or other alternatives, although no assurances can be made.

Bear Stearns has been getting a liquidity crunch over the last week that culminated over the last 24 hours.  This is a bailout for all practical purposes.  If you want to know what the brink of disaster looks like at a major financial institution, this is it.

Bear Stearns closed at $57.00 yesterday.  The initial reaction looked like this was going to open up 5% to 10%, but now shares are down around $54.00 or $53.00 in early indications.

Jon C. Ogg
March 14, 2008

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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